STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant is long moving into the Friday session.  The algorithm remains on a calm path for two weeks ever since the flip to the long side at 1377, forty handles ago. Keybot stays the bull course.  The quant continues to track copper. Watch JJC 43.60, now at 42.94. If the bulls move above 43.60 that will prove that the upside rally is the real deal and the rally will continue in an extended and sustainable manner. The bears will try to prevent JJC 43.60 with all their might. The dollar and euro tells the story.  A weaker dollar means a stronger euro and stronger copper, commodities and equities and a stronger dollar means a weaker euro and weaker copper, commodities and equities.

The quant is also tracking the utilities sector. The markets are rampant with cross currents. As the markets print new highs, the utes appear to be leading to the downside which would be a very ominous market signal.  Watch UTIL 472 tomorrow, price is now at 479.82, falling under 480 for the first time in three weeks. The quant is watching 472 thru the following Friday so this number is important for the next six trading days and only sits seven handles away. If UTIL drops under 472 it does not matter what the broad indexes are doing at the time since the markets would be moving lower in quick order.

For the SPX on Friday starting at 1416, the bulls are on easy street only needing to attain the 1417.50 level and hold it for a few minutes, if so, the markets will continue higher and test the closing high this year at 1419 and the intraday high for the year at 1422, then on to the strong 1424 resistance. The bears must retrace todays move and push under 1404 to accelerate the downside, a formidable task but not at all impossible.  A move thru 1405-1415 is sideways action to end the week. The bulls are driving the bus.  Watch JJC 43.60, UTIL 472, SPX 1417.50 and 1404. Markets are extremely unstable. Expect the unexpected. Keybot prints a pre-scheduled number at 10 AM tomorrow so the market action can be updated at that time.

8/19/12; 7:00 PM EST =

8/17/12; 10:00 AM EST =

8/16/12; 9:00 AM EST = +60; signal line is +45

8/12/12; 7:00 PM EST = +60; signal line is +44