STOCK MARKET BULLISH -- LONG

Keybot the Quant remains long as the stock market waits for more central bank largess. ECB President Lagarde is showing her goodies tomorrow. The quant is idling along this week not printing any numbers as yet. A status quo is in place where underlying market parameters remain in their respective camps and price chops sideways with a slight upward bias.

The bulls are jamming stocks higher effortlessly with the central banks at their back. The weaker US dollar is pumping commodities and oil higher sending the stock market higher. Very few understand the epic nature of markets currently. There are wild things that will likely happen going forward.

Bulls need a higher NYA index, higher commodities and higher utilities to continue the upside rally in equities. Bulls need NYA above 12617 which would signal an all-clear for more upside in stocks. The importance of this number cannot be overstated. Bulls will also goose stocks higher if GTX moves above 1696. Commodities will move higher if the US dollar keeps moving lower.

Utilities are important. This is historic price action. For utilities, you always want to keep track of the weekly closing price from 15 weeks prior since this tells you the weekly trend in utes and thereby the trend in the stock market. The 50-week MA is also a very important number for the utilities and UTIL's 50-wk is 839.19. The 15-week lookback comparison number for UTIL is 948.74 and the bulls will not achieve that this week. But for next week, the 15-week lookback number for UTIL is....... wait for it....... no, you really have to wait for it........ a bit longer....... 839.96. This is called an epic showdown. UTIL is at 820 now testing the 20-wk MA resistance. If UTIL moves above 839 over the next 8 trading days, it is a big-time bullish signal for the stock market. However, for the week of 6/15/20, the UTIL 15-wk lookback number is 901.70 so you wonder how the bulls will be able to keep the rally going that high, but for the week of 6/22/20, the UTIL 15-wk lookback number is down at 762.60. This is fantastic stuff.

During June, UTIL will tell you the fate of the stock market for the remainder of the year. On the bull side, if UTIL moves above 839 over the next 10 trading days, the stock market will catapult higher. If UTIL remains above 839 through this month, that tells you the bulls likely have juice to keep the stock market elevated into year end. On the bear side, with UTIL now at 820, if price goes up and teases around the 825-839 area for this week and next, but stalls, and rolls over lower, lookout Nellie. Stocks are going to fold like a cheap suit. If UTIL drops and takes out 763, it is lights out; the stock market will likely crash. Follow UTIL closely each day forward using these guidelines.

The bears have all left town and given up. You can see the big short-covering rally during the last 20 minutes of trading yesterday. Those were all shorts put on over the last week or two where the traders could no longer take the pain and gave up on the short side. Everybody and his brother are bullish the stock market currently. Notable financial analyst Alfred E Neuman says, "What? Me worry?"

Bears need the SPX below 3008 as fast as possible; this is their lifeline. Everyday the S&P 500 is above 3008 is another nail in the bear coffin. Bears must break out of that casket quickly before it is nailed shut. Bears will also benefit with higher volatility. Bears need the VIX above 34.70 (now trading at 26.84 on Wednesday morning 2:26 AM EST).

The beat goes on. Markets are calm this week but is that because it is just before the storm? We will see if Keybot prints any numbers today. If all of the above parameters remain status quo, the stock market will chop sideways with the slight upward bias. Global investors will be watching Madame Lagarde tomorrow to assess the size of her bazooka. She promised a bright new shiny pony (more ECB emergency bond-buying) so she had better deliver.

6/7/20; 7:00 PM EST =

6/5/20; 9:00 AM EST =

5/31/20; 7:00 PM EST EOM = +7; signal line is -28