STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant came within seconds of flipping long but algo rules held it back, maintaining the short side. If UTIL stays above 429.81, the SPX must now move above 1208.47 to verify that the bulls will run strong, otherwise, today's action will have no winner.

8/28/11; 7:00 PM EST =

8/26/11; 10:00 AM EST =

8/21/11; 7:00 PM EST =

8/17/11; 11:08 AM EST = -56; signal line is -75 but algorithm says stay short

8/17/11; 10:31 AM EST = -72; signal line is -74 but algorithm says stay short

8/17/11; 9:59 AM EST = -56; signal line is -73 but algorithm says stay short

8/16/11; 9:00 AM EST = -72; signal line is -72

8/15/11; 9:30 AM EST = -72; signal line -70

8/14/11; 7:00 PM EST = -88; signal line -68

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant hanging on to the short side but tenuously. A turn appears imminent. UTIL is above 429.81, SPX:VIX approaching 39, the SPX moved up and over 1204.22; it's all going the market bulls way. The algo wants to flip long now but is being held back by other programming rules. A move over SPX 1208.18 will probably trigger the flip to the long side. The market bears must defend 1208.18 to stop the bulls, it is the final line in the sand.  Time will tell.

8/28/11; 7:00 PM EST =

8/26/11; 10:00 AM EST =

8/21/11; 7:00 PM EST =

8/17/11; 9:59 AM EST = -56; signal line is -73 but algorithm says stay short

8/16/11; 9:00 AM EST = -72; signal line is -72

8/15/11; 9:30 AM EST = -72; signal line -70

8/14/11; 7:00 PM EST = -88; signal line -68

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant idled along all day without printing any numbers. The SPX moved between 1180 and 1204, hence, sideways slop.  Bulls could not push above 1204 and bears could not push under 1179, so neither side won. The utilities, UTIL, remained above 414, bullish, but below 429.81, bearish. Whichever way UTIL breaks out of the 414-429 area is the way the broad markets will be breaking.

SPX:VIX ratio remains above 35 which favors bulls.  If the ratio moves below 35, the market bears are regaining control.  If the ratio stays above 35, bulls have the recovery rally in place.

For the SPX in the Wednesday session, if the market bulls can move price above 1204, the buyers will have a party, and the recovery rally will continue along higher in quick order. If the market bears can move price under 1180.50, the bears are regaining control and will accelerate the broad markets lower.  A move thru 1181-1203 is sideways slop and the bull-bear standoff continues.

The algo is on the verge of flipping long but not yet. UTIL moving above 429.81 would be a major bullish signal. Stay on guard for a potential trend change. Keybot remains short from 7/11/11.

8/28/11; 7:00 PM EST =

8/26/11; 10:00 AM EST =

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST = -72; signal line is -72

8/15/11; 9:30 AM EST = -72; signal line -70

8/14/11; 7:00 PM EST = -88; signal line -68

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot remains short but the algo is very close to flipping to the long side.  Note that the algo number and signal line are now the same number indicating a potential trend change for the broad markets. Not yet enough to trigger the flip to the long side but very very close.  That said, the futures remain negative to start the day and the algo may post a more negative number after the bell.  Today will be an interesting ride.

Continue to watch utilities closely for hints.  UTIL, now at 426, is well above the critical 414.20 level bolstering the bullish case.  If UTIL moves above 429.81, less than four points higher, this will be firm confirmation that the broad market bulls plan on running the indexes higher.

For the SPX today, starting at 1204 with red futures, the market bulls had the wind at their backs and only needed to show the slightest tinge of green on the futures to catapult the indexes higher after the open.  If 1204.49 is touched the bulls will run today. But, alas, the futures are red instead. Thus, the market bears need to push down to lose the 1179 handle, if this occurs, then the bears will be running today and you will see the indexes lose several more handles in short order. A move thru 1180-1204 is sideways slop with no resolution.

Stay on guard; Keybot the Quant is on the verge of flipping to the long side but only time will tell. Europe news will dominate today.

8/28/11; 7:00 PM EST =

8/26/11; 10:00 AM EST =

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST = -72; signal line is -72

8/15/11; 9:30 AM EST = -72; signal line -70

8/14/11; 7:00 PM EST = -88; signal line -68

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short as the new trading week begins. The algo clicked off a number directly after the opening bell this morning bringing the algo number only two ticks away from the signal line. This warrants a caution designation in the blog post title since the bull market recovery rally is on the verge of confirmation by Keybot--but, not yet.

The SPX touched the 1189 handle after the open which set off a firestorm of buying. UTIL moved above the 413.7-ish area. The SPX:VIX ratio moved above 35. All three of these indicators confirm the bull rally move today.  Further confirmation is needed for the recovery rally with a drop in volatility; volatility currently remains elevated. Markets remain unstable and sit on pins and needles ahead of the Sarkozy/Merkel France/Germany summit tomorrow.

8/28/11; 7:00 PM EST =

8/26/11; 10:00 AM EST =

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/15/11; 9:30 AM EST = -72; signal line -70

8/14/11; 7:00 PM EST = -88; signal line -68

STOCK MARKET BEARISH -- SHORT

Keybot the Quant starts the new trading week remaining short, the algo continues along on the short side since 7/11/11. The signal line continues to creep lower towards the algo number, now only 20 ticks away, but the algo remains firmly bearish for now.

The utes will lead the markets back up, if the markets choose to go up.  UTIL, now at 411.21, needs to climb above 413.67 for the bulls to continue a recovery rally.  If not, the bears remain in control and the broad indexes will move sideways to sideways down. Watch the critical UTIL 413.7-ish level all week long, above and market bulls are happy, below and bears are happy.

When the SPX:VIX ratio moves above 35, that will signal a big up day for the indexes and a triple digit up day for the Dow Industrials. The ratio has a 32 handle to start the week. Staying below 35 and the bears will rule, above 35 means the bulls have a recovery rally in place.

For the SPX in Monday's session, starting at 1179, the market bulls need to push the indexes higher to touch 1189. If so, substantial buying will enter the markets, the indexes will jump several more handles in short order, UTIL should be bullish, and the recovery rally will probably gain steam. Conversely, if the futures are red tonight, and Monday starts off with the bears pushing lower, if the 1171 handle is lost, the bears are gaining momo, if 1170.74 is lost, you will see the markets collapse several handles in minutes.  This would dash hopes of a recovery rally.  A move thru 1172-1188 is sideways slop, a bull-bear standoff. One pre-scheduled number clicks off this week before Tuesday's open.  Markets remain highly unstable.

8/28/11; 7:00 PM EST =

8/26/11; 10:00 AM EST =

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST = -88; signal line -68

8/12/11; 2:11 PM EST = -88

8/12/11; 1:48 PM EST = -72; signal line is -62

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains bearish thru the end of the trading week. The algo was very active today, clicking off seven numbers including the pre-scheduled print. Four numbers printed from about lunchtime on in the Friday session. Utilities mounted a come back to try and lead the broad markets higher but collapsed around 2 PM EST, taking the indexes lower into the close.

Note how the signal line keeps falling towards the algorithm number. From last Sunday, -32, -39, -47, -57, -62. The first stage of Keybot wanting to flip sides occurs when the algo number crosses the signal line. Keybot has other algo rules it must follow, however, before locking in any market trend change. The first step is the interplay between the algo number and the signal line so you can see a potential change may be coming soon. Keybot is an intelligent algorithm, and continues to work and reposition even though the markets were flat on the week.  If the signal line moves a few integers lower, the title line of the posts will start to state CAUTION again to signal a potential filip to the long side coming. But, for now, the algo only sees 1's and 0's, so you simply have to watch Keybot during the coming days, and short remains the current trend.

We will project numbers to watch for the coming week after the algo clicks off Sunday's number tomorrow. Markets remain highly unstable.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 2:11 PM EST = -88

8/12/11; 1:48 PM EST = -72; signal line is -62

8/12/11; 12:31 PM EST = -88

8/12/11; 11:43 AM EST = -72; signal line is -57

8/12/11; 10:00 AM EST = -88

8/12/11: 9:59 AM EST = -88

8/12/11: 9:30 AM EST = -72; signal line is -47

8/11/11: 3:58 PM EST = -88

8/11/11: 3:31 PM EST = -72; signal line is -39

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

Keybot the Quant stays on the short side as the algo prints two numbers after today's opening bell as well as the pre-scheduled number minutes ago.  The utes, UTIL, moved above the 50 week MA giving the bulls hope for a continued rally, but, UTIL lost the level a short time ago favoring the bears again.  UTIL now at 413.30 is only 40 cents under where the bulls can go into rally mode.  If UTIL stays under 413.70-ish today, the bears will rule the day overall.

SPX came up to tag the 1186 level but in a minute it failed. Thus, continue to watch 1186 as another signal that the bulls will run.  If the SPX cannot get above 1186 today, the bulls have nothing, if they move above 1186, the buyers will come into the markets in force pushing the indexes immediately upwards. SPX:VIX ratio, now at 32, remains under the important 35 level. Bulls got nothing unless they can get this ratio above 35 which will indicate a huge up day on tap. If the ratio stays under 35 as it currently is, the bears will continue to rule these broad markets.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST = -88

8/12/11: 9:59 AM EST = -88

8/12/11: 9:30 AM EST = -72; signal line is -47

8/11/11: 3:58 PM EST = -88

8/11/11: 3:31 PM EST = -72; signal line is -39

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

The algo remains short.  The rally party did not last long for the bulls. The utilities, UTIL, closed at 413.09, falling back below the 50 week MA at 413.71 as the closing bell rang. This is a bearish sign for the markets.  Watch UTIL at the opening bell tomorrow. If 413.71 is regained then the bulls will try to push things higher again. If UTIL does not regain 413.71, then the bears remain in full control and the broad markets will continue along sideways to sideways lower.

For the SPX tomorrow (Friday), starting at this critical support/resistance level at 1172-ish, if the market bulls can push upwards to hit 1186, the buyers will jump in and accelerate the move several handles higher in quick order. If the market bears can keep UTIL under the 50 week MA as described above, weakness will remain in the markets.  The bears, however, need to push the SPX down to the 1121 area if they want to accelerate the move lower and see heavy selling pressure enter the market. If 1121 is hit, 1118 and 1112 would be hit in short order, perhaps also a test of the 1101 LOD from Tuesday.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/11/11: 3:58 PM EST = -88

8/11/11: 3:31 PM EST = -72; signal line is -39

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains short as a higher number clicks off for the algo minutes ago.  This is the first number the algorithm printed since the Monday opening bell. The SPX touched 1172 so the buyers came in to accelerate the move up as projected; SPX now moving towards 1184.

The first sign of a recovery rally occurred with UTIL moving above its 50 week MA. UTIL is now printing over 415 and the 50 MA is 413.75, thus, the bulls are gathering steam.  The SPX:VIX ratio remains under 35, however, so the bears are far from done.  The ratio has a 31 handle and once it moves above 35 the bulls will run, until then, the bears are hanging around.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/11/11: 3:31 PM EST = -72; signal line is -39

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

Keybot the Quant idles along on the short side. The algo has not printed any numbers this week since the Monday opening bell. A pre-scheduled number will click off at 10 AM tomorrow. For hints of a sustained recovery broad market bounce, watch the SPX:VIX ratio, now at 26. If the ratio moves above 35, that will signal a huge up day for the indexes and provide the bulls with encouragement.

The utilities, since they cracked last to signal the markets going off the cliff last Thursday, require close watching to gauge if a recovery rally is at hand.  Watch UTIL, now at 397, if the utes move above 413, that will signal that the bulls are gathering a healthy head of steam. If UTIL cannot attain the 413 level, then more sideways to sideways down behavior will occur in the broad markets.

For the SPX in Thursday's session, the bears only need to push two points lower to move under 1118. If the 1117 handle is touched, the sellers will enter in force, driving the SPX down to test 1112, then perhaps 1101, to possibly verify a temporary bottom for the markets.  The bulls have to do heavy lifting today and push the SPX up to 1172 if they expect bullish enthusiasm to enter the broad markets.  Accelerated buying will occur if 1172 is touched today.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

The algo remains short motoring along unchanged today. A snap back rally occurred but the strength remains in question.  Watch to see if the utes, UTIL, now at 404.59, can regain the 50 week MA at 413.53, nine points higher. If so, that would indicate that the bulls have some strength, otherwise, they do not.

Since the markets closed at the highs, the market bulls have the wind at their backs, only needing to keep the futures green overnight, if so, they will accelerate the buying from the opening bell tomorrow. The large and wild moves should continue tomorrow, markets remain unstable. Market bears would need a large move down to touch 1101. If so, the bears will accelerate the selling again.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

Keybot remains short, idling along calmly thru the chaos. A weaker number clicked off this morning and there were no other changes all day long. The algorithm has now gained over 200 handles from the SPX 1324 short entry 22 trading days ago. It will be interesting to see where the algo locks in the short side and flips long.  There is no sign of that yet, however, considering the -88 number is far below the signal line number.

Since the SPX closed at the lows, 1119, the bears are in full control and can simply accelerate the selling after the bell tomorrow with red futures.  The bulls need green futures overnight and will look to the China economic data for help. The bulls have to defend the 1119 level at all costs tomorrow, if it fails, then the market selling will accelerate lower once again.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

Keybot remains short as the new week growls from the opening. UTIL lost the 50 week MA at the open so you knew the day would be rough.  SPX lost the Friday LOD at 1168 at 10:15 AM which accelerated the selling. Markets are firmly bearish now but that said, the oversold readings and other indicators are screaming for a bounce.  The markets are having trouble with any lift, buyers are on a milk carton.

For the remainder of today, watch the SPX LOD, last low print was 1151.88. Bulls need to hold this level since it also represents the critical 1150-1170 support zone. Selling will increase further if todays LOD is lost. A loss of the 1150 level is a serious market event that will have an impact for months, perhaps years, to come. Today we will see if it holds.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/8/11: 9:30 AM EST = -88

8/7/11; 7:00 PM EST = -72; signal line is -32

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains short for four weeks now.  The Sunday print leaves the algorithm number unchanged at -72, comfortably 40 points below the signal line where a potential trend change from short to long would occur. The SPX falling below the 12 month MA, the slope of the 150 day MA turning negative and the failure of the utlities sector all contributed to the collapse in the markets.

For this week, the utes, measured by UTIL, starts at 414.72. The 50 week MA is 413.29, this number obviously changes slightly as time progresses (since it is a moving average). The 15-week look-back comparison number for this week is 429.06.  Thus, UTIL is above 413.29 indicating a move off the bottom for the broad market indexes already.  If UTIL moves under 413.29, major selling will come into the markets again.  If UTIL stays between 413.29 and 429.06, the broad markets are recovering into a snap back rally mode.  If UTIL moves above 429.06 any day this week, the broad markets will be moving strongly upwards for an extended substantial rally.

The technical damage last week was extensive and severe. Volatility, VIX, requires close watching, closing in the 30's. For the SPX in Monday's session, starting at 1199, if 1218 is taken out to the upside the buyers will come in large numbers, the broad markets will accelerate upwards from there. The market bears have to push hard, down to the Friday low of 1168, to keep the negative party going. Barring that, a move thru 1170-1217 can be considered sideways slop with no resolution either way for the path forward.

Keybot prints out only one pre-scheduled number this week on Friday morning.  So we will see if the algorithm simply idles along content with staying short, or, if the bulls come back in to boost the indexes. Markets remain highly unstable.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/7/11; 7:00 PM EST = -72; signal line is -32

8/5/11; 12:44 PM EST = -72

8/5/11; 9:53 AM EST = -88

8/5/11; 9:32 AM EST = -72; signal line is -24

8/5/11; 9:00 AM EST = -88

8/4/11; 3:29 PM EST = -88

STOCK MARKET BEARISH -- SHORT

The algorithm printed a number after lunch yesterday and then idled into the weekend at -72.  The -88 number is very close to the -100 maximum and fully consistent with a reversal expected in equities markets.

Keybot remains bearish; the algorithm still short from 7/11/11.  The utilities sector is the most important area to watch in Monday's session. A pre-scheduled number clicks off tomorrow which will help set up next week.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/7/11; 7:00 PM EST =

8/5/11; 12:44 PM EST = -72

8/5/11; 9:53 AM EST = -88

8/5/11; 9:32 AM EST = -72; signal line is -24

8/5/11; 9:00 AM EST = -88

8/4/11; 3:29 PM EST = -88

STOCK MARKET BEARISH -- SHORT

The algorithm motors along on the short side, printing a lower number again. UTIL could not hold the 50 week MA at 413.21. Continue to watch this today to gauge broad market selling versus buying. Bulls need to get above UTIL 413.21, if not, then they have a long day ahead. Much of the early weakness due to forced selling to meet margin calls. This should subside. The markets may experience buoyancy after the European markets close.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/7/11; 7:00 PM EST =

8/5/11; 9:53 AM EST = -88

8/5/11; 9:32 AM EST = -72; signal line is -24

8/5/11; 9:00 AM EST = -88

8/4/11; 3:29 PM EST = -88

STOCK MARKET BEARISH -- SHORT

Keybot remains firmly short. The utilties, measured by UTIL, moved back above the 50 week MA at 413.31 after the opening bell which will help the bulls start a recovery rally today, if it holds.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/7/11; 7:00 PM EST =

8/5/11; 9:32 AM EST = -72; signal line is -24

8/5/11; 9:00 AM EST = -88

8/4/11; 3:29 PM EST = -88

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains on the short side.  The pre-scheduled number leaves the algo unchanged. Markets are jumpy this morning so Keybot should print out some numbers in the early going.  A snap back rally would be expected now; we will see if the jobs report better-than-expected number helps.

The market bears only need to push the SPX a half point lower to accelerate the selling again. The bulls will be content with a sideways move today.  The utilties failed yesterday at UTIL 418.37, as an initial warning, then, at the 50 week MA, which represented the trap door for the broad markets, which occurred. Watch the 50 week MA for UTIL, now at 413.21, this is an extremely important number.  UTIL begins the day with a 410 handle. Staying below and the broad market bears maintain control on the indexes; above 413.21, and the bulls will start a snap back rally. Markets remain highly unstable.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/7/11; 7:00 PM EST =

8/5/11; 9:00 AM EST = -88

8/4/11; 3:29 PM EST = -88

8/4/11; 2:34 PM EST = -72

8/4/11; 2:25 PM EST = -88

8/4/11; 11:45 AM EST = -72

8/4/11; 9:30 AM EST = -56

8/3/11; 1:15 PM EST = -40

8/3/11; 12:28 PM EST = -56

8/2/11; 11:09 AM EST = -40

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains short, the algorithm is almost pegged to the downside now, at -88 only 12 points away from a maximum negtive reading of -100. The 50 week MA for the utilities, UTIL, failed this afternoon and, as projected in the previous posts, the broad markets went into free fall.

A pre-scheduled number prints out before the open tomorrow.

8/21/11; 7:00 PM EST =

8/16/11; 9:00 AM EST =

8/14/11; 7:00 PM EST =

8/12/11; 10:00 AM EST =

8/7/11; 7:00 PM EST =

8/5/11; 9:00 AM EST =

8/4/11; 3:29 PM EST = -88

8/4/11; 2:34 PM EST = -72

8/4/11; 2:25 PM EST = -88

8/4/11; 11:45 AM EST = -72

8/4/11; 9:30 AM EST = -56

8/3/11; 1:15 PM EST = -40

8/3/11; 12:28 PM EST = -56

8/2/11; 11:09 AM EST = -40