Sunday, August 17, 2014


Keybot the Quant is long moving into the Monday session and new week of trading. Monday will be a battle between financials and volatility since these two sectors are the greatest influence on market direction to begin the week. Bears need XLF under 22.53 (now at 22.58 causing market bullishness). Bulls need VIX below 12.87 (now at 13.15 causing market bearishness). The bulls will have difficulty pushing equities higher unless the VIX drops under 12.87. Bears will create a market selloff with XLF under 22.53. If both parameters remains status quo, equities will float along sideways with a slight upward bias.

For the SPX starting at 1955, the bulls need to touch the 1964 handle to accelerate the upside. The bears need to push under 1941.50 to accelerate the downside. The wide 1942-1963 range is sideways action to begin the week. The bulls are cruising, however, if financials weaken (listen for any bank news overnight), the caution flag will be placed and Keybot will be moving towards a potential flip to the short side ahead. If good news occurs in banks overnight, equities will likely remain elevated early in the week. Keybot prints one pre-scheduled number this week on Tuesday morning.

8/24/14; 7:00 PM EST =
8/19/14; 9:00 AM EST =
8/17/14; 7:00 PM EST = +39; signal line is +20
8/15/14; 2:31 PM EST = +39; signal line is +18

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