STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short the SPX to start the new trading week of 5/16/11. Below is the algorithm printout that gets everyone back up to date after the Blogger outage. Sunday's release number is included since Keybot is idling now until 9:30 AM EST Monday.

The SPX was flat last week but you would never think that considering all the drama.  Despite the volatility remaining low, the indexes behaved as if the volatility was high anyways, with triple digit Dow point swings from bull to bear and bear to bull each day. This may hint that volatility will make a move higher this coming week.

If the VIX moves over 17.66, now at 17.07, then the market bears can keep Friday's slide going.  If the VIX remains under 17.66, as it is now, then the market bulls will wrestle back control.

Current markets remain a fight between bearish copper, commodities and financials against bullish utilities, semi's, retail and volatility.  Semi's are sitting on the bull-bear fence this weekend as highlighted below.  Retail is simply astounding, the big surprise sector currently and most definitely, along with utes, are keeping the bulls afloat.

As a most simple tool to use after the open tomorrow, simply watch the semiconductors, SOX, now at 440.95.  If this index simply loses 14 pennies after Monday's open, and goes sub 440.81, then the broad markets will continue selling off.  If, however, the SOX remains above 440.81 and wants to drift higher as the day proceeds, then the market bulls will be back in control of the broad indexes.

If the SPX moves over 1350.47 on Monday, the broad markets will accelerate higher.  If the SPX moves under 1333.36, the selling will accelerate several more spoo handles and the broad markets will all continue lower. The SPX is currently at 1337.77, thus, the bears have a slight edge, only four points away from being able to push the markets further south.

Caution is warranted since the +30 algorithm number is within 9 of the signal line. The algorithm wants to go long but additional rules in the program are preventing the move, at least so far.  This behavior has been in place for three days in a row. Continue to stay on guard and expect the unexpected.  Markets remain unstable.

Keybot clicks off one pre-scheduled number this week on Tuesday morning.  Stay tuned since the algorithm should continue to click off additional numbers in real-time during trading hours.

6/5/11; 7:00 PM EST =

6/3/11; 9:00 AM EST =

5/31/11; 7:00 PM EST EOM =

5/31/11; 10:00 AM EST =

5/29/11; 7:00 PM EST =

5/27/11; 10:00 AM EST =

5/22/11; 7:00 PM EST =

5/17/11; 9:00 AM EST =

5/15/11; 7:00 PM EST = +30; signal line is +21 but algorithm says stay short

5/13/11; 1:44 PM EST = +30; signal line is +22 but algorithm says stay short

5/13/11; 1:35 PM EST = +14

5/13/11; 10:00 AM EST = +30; signal line is +22 but algorithm says stay short

5/12/11; 10:09 AM EST = +30; signal line is +21 but algorithm says stay short

5/12/11; 9:51 AM EST = +16; signal line is +22

5/12/11; 9:44 AM EST = 0

5/12/11; 9:30 AM EST = +14

5/11/11; 3:54 PM EST = +30; signal line is +23 but algorithm says stay short

5/11/11; 1:13 PM EST = +14; signal line is +23

5/11/11; 12:37 PM EST = +30; signal line is +23 but algorithm says stay short

5/11/11; 12:16 PM EST = +14; signal line is +24; go short 1342; (Benchmark SPX for 2011=+6.7%)(Keybot this trade=-0.6%; Keybot for 2011=+3.1%)(Actual this trade via DDM=-1.1%; Actual for 2011=-0.3%)

5/11/11; 9:30 AM EST = +30; signal line is +25