Sunday, January 10, 2021


Keybot the Quant remains long as the stock market goes parabolic. Traders are bulled-up on a perpetual money-printing heaven coming from the incoming Biden administration. The massive liquidity will pump stocks to the moon, or that is at least what traders think. The SPX prints a new all-time record high at 3826.69 and all-time record closing high at 3824.68 both on 1/8/21 the highest numbers ever printed in the history of the US stock market (despite the Capitol Hill Riot).

The bulls are in their glory days but interestingly, the algo number is only 4 points above the signal line. Therefore, view the stock market as more of a coin-flip. The Fed crushed volatility so stocks pop. Bears need the VIX above 25.14 (now at 21.56) to create market negativity.

The quant's parameters are very strong. Watch utilities. Bears need UTIL below 832.49 (now at 851.28). Stocks will take a noticeable dip if this happen. Interestingly, despite the record highs and euphoric bullishness, if UTIL would then fail at 827, a trap-door would open in the stock market that could go into a flash crash event. There is likely a very interesting week and month ahead. If UTIL moves higher and away from 832, that would signal that the bulls should be able to keep stocks elevated for a few days forward.

The bulls are cruising along but if UTIL loses 832.49, and the SPX drops below 3784 heading lower, Keybot would likely flip into the bear camp. The SPX begins the week at the record high 3825 so the bears would need a 41 point drop on Monday. Markets remain erratic and highly unstable. Watch the utilities.

1/17/21; 7:00 PM EST =
1/15/21; 10:00 AM EST =
1/10/21; 7:00 PM EST = +67; signal line is +63
1/8/21; 9:00 AM EST = +67; signal line is +63
1/6/21; 3:59 PM EST = +67; signal line is +63

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