STOCK MARKET BEARISH -- SHORT -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant remains short. One day is stranger than the next in these historic markets. Bulls had equities delivered on a silver platter yesterday but could not convert, yet. The bulls needed to hold SPX 1802, but could not, so the algo could not latch and lock for the long side, and Keybot remains short despite the algo number above the signal line. The bulls have the markets on a silver platter again for Tuesday, only needing to punch above 1802.50, and hold this level for several minutes, and that should be enough to cause Keybot to flip long. The bears need to push about 3 points lower, under 1788, and the downside will accelerate. S&P futures are -2 about 5-1/2 hours before the U.S. opening bell. A move through 1789-1801 is sideways action for Tuesday.

UTIL 503.04 remains an important bull-bear line in the sand for this week and the bulls are solidly comfortable at 506.84. The algo is now prioritizing volatility. The VIX is 13.10 and Keybot identifies the bull-bear line in the sand at 13.97. Market bulls are okay as long as the VIX remains under 13.97. Market bears will celebrate if VIX hits 13.97 since this will usher in the market downside. The bulls need copper and commodities to run higher to create more upside equity mojo but instead these parameters continue to retreat and copper is weak again this morning. This hints that perhaps the market upside is limited from here on out. The algo is also tracking financials. Watch XLF 20.65, now at 21.12, comfortably in the bull camp, creating upside market lift.

The bulls only need SPX 1802.50+ for a few minutes and Keybot will likely flip long and further upside is ahead. A gap-up opening, which is not currently on tap looking at the futures, may delay any flip to the long side. The bears need SPX 1788, UTIL 503.04 and/or VIX 13.97 to lock in equity selling moving forward. Markets remain erratic and unstable.

11/24/13; 7:00 PM EST =  

11/18/13; 9:37 AM EST = +46; signal line is +42 but algorithm remains short

11/17/13; 7:00 PM EST = +30; signal line is +42