Tuesday, August 18, 2020


Keybot the Quant remains long as the bulls keep slapping the bears around. The algo is idling along this week only printing the prescheduled number thus far. The bulls are in control of the stock market direction with the algo number 7 points above the signal line.

Utilities trend lower the last couple days so it is surprising that the SPX prints a new all-time high at 3395.06 and new all-time closing high at 3389.78 today, Tuesday, 8/18/20. The VIX collapses to 21.51 pumping stocks higher. Copper is experiencing more supply disruptions so the price goes to the moon which pumps the stock market higher.

There is a new development. The quant is now tracking banks as the key parameter impacting stock market direction. On a sleepy day, the banks come out of the shadows and display their fragility. Bears need XLF below 24.12 (now at 24.60) to create the start of market mayhem. This is a -2% drop so pay attention to any news hitting the wires concerning banks here forward. If bad news surfaces, you know the fix is probably in for the stock market and the long-anticipated top in the stock market will likely occur.

If XLF loses 24.12 tomorrow, Wednesday, 8/19/20, consider the imminent turn to the short side to be in play, and if the SPX drops below 3370, Keybot will likely flip short.

Bulls need stronger utes to prove that the new all-time highs are not a fluke. Bulls must push UTIL above 835 or they got buptkis. If UTIL remains bearish, and XLF remains bullish, status quo, the stock market will stagger sideways with a slight positive bias.

On hump day, the utilities face off against the banks to determine which way the stock market will go, two enter the cage match, but only one will exit. The banks may lead the stock market down. There's Winners and Losers every day in the big city.

8/23/20; 7:00 PM EST =
8/18/20; 9:00 AM EST = +53; signal line is +46
8/16/20; 7:00 PM EST = +53; signal line is +46

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.