Tuesday, May 20, 2014

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

Keybot the Quant remains short but is champing at the bit to go long. The algo number is above the signal line but the program cannot yet latch all the necessary parameters to permit the move to the long side. If the SPX prints above 1886, and remains above, Keybot will likely flip long. A gap-up timer may activate preventing the move long for about 90 minutes time but the S&P futures are -2 so the gap-up timer will likely not activate.

Watch retail versus financials. The financials and semiconductors pumped the markets higher yesterday. Watch XLF 21.83. Price is at 21.86 three cents on the bull side creating market bullishness. Watch RTH 58.65. Price is at 58.35 thirty cents on the bear side creating market negativity. Bulls need RTH above 58.65 but this may be tricky since HD just reported a miss on earnings. Bears need XLF under 21.83 to create selling and weaker markets. The EU just brought charges of rate-rigging against three banks so this may cause weakness in the financials.

For the SPX starting at 1885, the bulls only need one point, to push above 1886, and there is nothing but blue skies above, Keybot will likely flip long, and the path to SPX 1891 then 1900 begins. The bears need to push under 1873 to accelerate the downside. A move through 1874-1885 is sideways action. The bears are driving the bus but the bulls already have one hand on the wheel and will likely take over if the SPX moves above 1886 and higher. Watch XLF 21.83 today since it will dictate broad market direction.

5/25/14; 7:00 PM EST =
5/19/14; 2:22 PM EST = +64; signal line is +54 but algorithm remains short
5/19/14; 2:12 PM EST = +48; signal line is +53
5/19/14; 1:42 PM EST = +34; signal line is +53
5/19/14; 12:38 PM EST = +48; signal line is +53
5/19/14; 12:18 PM EST = +64; signal line is +53 but algorithm remains short
5/18/14; 7:00 PM EST = +48; signal line is +52

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