Thursday, February 16, 2012

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant flips back to the long side. The market bulls pushed hard with utilities today and that was the tell.  The VIX could not move above its 50-day MA, SPX:VIX ratio popped back above 68 and the SPX took out yesterday's highs.  So a whipsaw does occur with Keybot turning bullish within 48 hours of where the algo went short.  The algo program lost a percent due to the stutter step and the actual trading lost 2%.  The quant dropped down into a lower risk mode now and is trading with non-leveraged ETF's now for the next 45 days.

Keybot is long again but stay on guard since a whipsaw back to the short side may occur at anytime. The key item to watch is utilities since they provided the bull push today. The UTIL 451.17 number is important thru tomorrow and this number will ratchet up higher for next week.

Looks like 2012 is kicked off ofifcially now and running strong. The AAPL and tech strength story, and now the utes strength, is too much for market bears to overcome, but, the markets are simply one news event away from turmoil.  The caution flag remains out, these markets can flip flop again at any time.

2/19/12; 7:00 PM EST =
2/16/12; 1:10 PM EST = +76; signal line is +54; go long 1356; (Benchmark SPX for 2012  = +7.8%)(Keybot this trade = -1.0%; Keybot for 2012 = +5.7%)(Actual this trade = -2.0%; Actual for 2012 = +8.2%)
2/16/12; 10:15 AM = +76; signal line is +52 but algorithm says stay short
2/16/12; 9:00 AM = +60; signal line is +50 but algorithm says stay short
2/14/12; 2:30 PM EST = +48; signal line is +49; go short 1342; (Benchmark SPX for 2012  = +6.7%)(Keybot this trade = +6.7%; Keybot for 2012 = +6.7%)(Actual this trade = +10.2%; Actual for 2012 = +10.2%)

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