Wednesday, August 27, 2014


Keybot the Quant remains long as copper dictates the market ebb and flow today. JJC closes exactly on the 38.80 bull-bear line in the sand. How is it possible for the algorithm to predict these numbers in advance? Even David Copperfield scratches his head. The pivot from JJC 38.80 will dictate the stock market direction for Thursday, thus, watch copper overnight, if up, market bulls will be happy tomorrow, if down, bears will rejoice. Also watch VIX 12.52. Copper and volatility remain the two key parameters currently determining broad market direction.

The bulls bump the algo number higher again late in the Wednesday session but the caution flag remains for now since the market price conditions are becoming dicey and unstable. For the SPX on Thursday starting at 2000, the bulls only need to see a smidge of green in the futures and the SPX will immediately run to 2005 and then potentially 2009-2011. The bears need to push under 1996 to accelerate the downside. The bears kept pushing today at the 1998-1999 level but never convincingly broke. A move through 1997-1999 is sideways and is too tight a range. One side or the other will win and run big in that respective direction tomorrow. If copper is up, and the S&P futures are a tiny amount positive, bulls will win big. If copper is weak, and the S&P futures are negative by any amount overnight, the bears will have another chance at bat and run the markets lower.

8/29/14; 10:00 AM EST =
8/27/14; 3:47 PM EST = +70; signal line is +47
8/27/14; 9:39 AM EST = +54; signal line is +45

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