Thursday, March 22, 2012

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short and tomorrow we see if a whipsaw occurs, or not.  Copper, JJC, was the key since it collapsed at the open today. Then the CRB followed along lower.  Commodities and copper were slapped due to the stronger dollar.  When the commodities and copper sell off so will the broader markets. Utilities, UTIL, remained flatish all day long and did not sell off.

The Friday session, and whether or not Keybot decides to move back to the long side, will depend on the action in JJC and CRB. The market bears want to see a higher dollar, the market bulls want to see a lower dollar, it is really that simple.  Watch JJC 48.80 and CRB 312.40. The quickest tell will be the CRB since price will open at 312.27 only 13 pennies on the bear side. The CRB moving back to the bull side should not be that important of an event but if JJC, now at 48.39, should move above 48.80, this will derail any bearish activities planned and the market bulls will quickly return to the drivers seat.

For the SPX, starting at 1393, the market bears need to move below the 1389 handle and the downside move will accelerate with a test of the 20-day MA at 1379.55 likely on tap.  The bulls would have to retrace today's move back up to reignite an upward acceleration, probably not likely, so instead, the bulls will focus on creating a weaker dollar which will cause copper and commodities to climb upwards and remove any threat of downward bearish momo.  A move thru SPX 1390-1401 is sideways action.

Very simply, a red dollar and bulls win or a green dollar and bears win. If the dollar is red, watch to see if JJC exceeds 48.80 and/or CRB exceeds 312.40. If both occur, along with a strong broad index move up with the SPX moving over 1400, Keybot would likely return to the long side, otherwise, the bears will continue to growl. Markets remain highly unstable. Caution is required.

3/25/12; 7:00 PM EST =
3/22/12; 12:13 PM EST = +46; signal line is +63
3/22/12; 11:31 AM EST = +60; signal line is +64
3/22/12; 11:14 AM EST = +46; signal line is +65
3/22/12; 11:00 AM EST = +60; signal line is +66
3/22/12; 10:52 AM EST = +46; signal line is +66
3/22/12; 10:51 AM EST = +60; signal line is +67; go short 1392; (Benchmark SPX for 2012  = +10.7%)(Keybot this trade = +2.1%; Keybot for 2012 = +5.2%)(Actual this trade = +1.0%; Actual for 2012 = +6.8%)

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