Tuesday, July 22, 2014


Keybot the Quant remains short but the bears folded like a cheap suit once volatility dropped. The VIX is under the bull-bear line at 12.96 so equities will move higher. Bears need VIX above 12.96 or they got nothing. Keybot is champing at the bit to go long and is latching in parameters to permit the move. If the SPX prints above 1977, the algo will likely flip to the long side. S&P futures are +6 forecasting a strong start to the day but the open remains four hours away. A gap-up open may trigger a timer that will delay the move to the long side for about 90 minutes.

For the SPX starting at 1974, the bulls need to touch the 1977 handle and the upside will accelerate above 1980 on its way to test the all-time highs. The bears need to push under 1966 to accelerate the downside. A move through 1967-1976 is sideways action for Tuesday. The bears are driving the bus but the bulls appear ready to take over again. Pay attention to the intraday high prints as they occur today. The algo number is only two points above the signal line but that will be enough to create a flip to the long side if the other internal program parameters latch into place. VIX 12.96 identifies the winner.

7/27/14; 7:00 PM EST =
7/21/14; 1:12 PM EST = +66; signal line is +64 but algorithm remains short
7/21/14; 10:17 AM EST = +52; signal line is +64

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