STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short and another day passes with the algo simply idling along without printing any numbers. Tomorrow a pre-scheduled number occurs at 10 AM so that will provide a print this week.  The SPX moved sideways today. The 1321 level was violated but the bulls could not hold on to provide any upside momo.  The retail sector came to life today despite weak TIF earnings.  Watch RTH 41.15.  The sneaky RTH moved higher today into the close to print 41.07 only eight pennies from this bullish goal. If RTH overtakes 41.15, this will provide another upward leg for the markets.

Watch VIX 18.25, now at 21.54.  A move under 18.25 would be a feather in the bull's cap and provide further upside market strength. Also watch the NYA 40-week MA at 7637, now at 7552, only 85 points away.  Remember a few days back when the NYA fell under the 40-week MA which indicates secular bear markets ahead? This current price move is a back kiss of this critical moving average. The bull's will strongly regain market control if the NYA moves back above 7637.

For the SPX on Friday starting at 1321, the bulls need to touch 1324, only three points higher, and the markets will accelerate upwards into the holiday weekend.  The bears need to push lower under 1310.50 and the markets will accelerate to the downside and ruin the long trader's plan for a happy holiday barbeque.  A move thru 1311-1323 is sideways action. To determine broad market direction, watch RTH 41.15, NYA 7637, SPX 1324 and 1310.50, these four characters will tell you the story. The market action can be updated after the pre-scheduled number prints tomorrow.

5/27/12; 7:00 PM EST =

5/25/12; 10:00 AM EST =

5/20/12; 7:00 PM EST = -30 signal line -3