STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long.  Volatilty, VIX, spiked above 19 today which ushered in the afternoon market weakness, but, at 3 PM the VIX dropped back under 19 which pushed the broad markets higher. The semiconductors, SOX, failed today and sit in the bear camp.  The algo is now fixated on four sectors; volatility, utilities, financials and retail.

Watch VIX 19.00, now at 18.36, above 19 and bears are happy, below and bulls are happy. Watch utilities, UTIL 451.20, now at 456.51, above 451 and bulls are happy, below and bears are happy.  Watch financials, XLF 15.10, now at 15.27, above 15.10 and bulls are happy, below and bears are happy. Watch RTH 40.94, now at 41.79, above 40.94 and bulls are happy, below and bears hare happy.  All four are bullish now so if any two of them join the bears, Keybot will likely flip short.  For the bulls to recover, the SOX must resurrect itself from 415 back up to 422.25 so the bears appear to have the upper hand moving forward.

For the SPX, starting at 1377, the bulls need to push upwards and touch 1390.50, if so, the markets will accelerate higher with the SPX headed to the psychological 1400.  The bears need to push lower to lose the 1370 handle, if so, the markets will accelerate lower into the low 1360's.  The SPX lost the 50-day MA today which is bearish.  A move thru 1371-1389 is sideways action. Markets are unstable. Monitor the four sectors highlighted above to determine broad market direction.

4/22/12; 7:00 PM EST =

4/19/12; 3:03 PM EST = +30; signal line is +11

4/19/12; 2:17 PM EST = +16; signal line is +10

4/19/12; 11:09 AM EST = +30; signal line is +10

4/19/12; 10:31 AM EST = +46; signal line is +10