STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant flips to the short side this morning a few minutes after the opening bell at SPX 6916. The bears have a lot to prove, however, since the algo number is only one measly point below the signal line. Nonetheless, the internal parameters latched and the robot is now short ahead of the Friday session that may prove historic.

Utilities remain in the bear camp creating the pall over the stock market. Equities stumble sideways today as traders and investors focus on the US Monthly Jobs Report released in the morning the first good set of jobs data in 3 or 4 months. In addition, the Supreme Court should pass down a decision on the legality of King Donnie's tariffs. Both events will move markets. The jobs report is 8:30 AM EST about 14 hours away and the Supreme Court decision may be anytime between 9 AM and 5 PM or who knows, maybe it will come out on Saturday?

UTIL 1063 remains the bull/bear line in the sand with price at 1055. This failure creates the stock market weakness the last couple days. Bulls must push UTIL, or DJU, above 1063 or they are toast.

Bears are lucky they flipped the model since there is only one point difference between the algo number and signal line that is nothing. Volatility appears to be the next target for the robot with a bull/bear line in the sand at VIX 16.89. Price is at 15.45 and the VIX begins trading at 3 AM EST.

Bulls need UTIL 1063 to prove they still got game and can take stocks higher. Bears need to keep utes weak and push the VIX above 16.89 that will create another leg lower in the stock market. If UTIL remains below 1063, and VIX below 16.89, stocks will stutter along sideways with a slight downward bias.

On the first trade of the year, that runs for only a few days (remember the quant was long since the end of last year but the trade results were split to keep the 2025 and 2026 numbers separate), the quant program gains a percent; ditto the benchmark SPX. The actual trading generated by the quant gains two percent to begin the year. Keybot the Quant exits SSO and enters SDS. The new year is off and stumbling.

Considering that tomorrow is the first good jobs numbers in a while, markets should react wildly so anything can happen. Stay alert for a potential whipsaw back to the long side if UTIL runs above 1063. The jobs numbers used to prove that the men were hard at work building America. Is this still true? We need some Horslips. Man Who Built America. Wicked flute action. 'And you see the world reflected in his face'.

1/11/26; 7:00 PM EST =
1/9/26; 9:00 AM EST =
1/8/26; 9:34 AM EST = +24; signal line is +25; go short 6916 (Benchmark SPX for 2026 = +1.0%)(Keybot algo this trade = +1.0%; Keybot algo for 2026 = +1.0%)(Actual results this trade = +2.0%; Actual results for 2026 = +2.0%)
1/7/26; 10:16 AM EST = +24; signal line is +25 but algorithm remains long
1/5/26; 3:56 PM EST = +40; signal line is +25
1/5/26; 10:02 AM EST = +24; signal line is +25 but algorithm remains long
1/4/26; 7:00 PM EST = +40; signal line is +25
1/1/26; Begin 2026 Data = +40; signal line is +25; go long 6846; (Benchmark SPX for 2026 = +0.0%)(Keybot algo this trade = +0.0%; Keybot algo for 2026 = +0.0%)(Actual results this trade = +0.0%; Actual results for 2026 = +0.0%)