Tuesday, October 21, 2014


Keybot the Quant remains long as the bulls slap the bears silly from start to finish in the Tuesday session. The algo printed one number gaining strength up to -7. RTH exploded higher at the opening bell and an upside party followed; the biggest day of the year for equities. For the Wednesday session, it appears the algo is most focused on financials. Watch XLF 22.90 as the bull-bear line in the sand. XLF begins at 22.87 only three pennies on the bear side. If XLF stays under 22.90 and leaks lower, the upside broad market rally will stall and the broad indexes will flatten out sideways with a downward bias. If XLF moves above 22.90, only three pennies away, the stock market will explode into a sustainable and extended upside move and the bears will be toast.

For the SPX starting at 1941, the bulls only need to push above 1942.50 less than two points higher and an upside acceleration will occur to 1951. So watch to see if the S&P futures hand the bulls a couple points overnight, or not. The bears need to retrace Tuesday's large up move, a formidable task, so instead the bears will focus on pushing financials and semiconductors lower. If either XLF or SOX, respectively, moves higher, the bears will fold like a cheap suit. The bulls are driving the bus and they ran over a few bears today. For Wednesday the financials, the pivot from XLF 22.90, will determine the broad market direction forward. Watch it like a hawk and listen for any news, good or bad, concerning the banks.

10/26/14; 7:00 PM EST =
10/21/14; 9:36 AM EST = -7; signal line is -23
10/20/14; 2:12 PM EST = -23; signal line is -24; go long 1900; (Benchmark SPX for 2014 = +2.8%)(Keybot this trade = +2.2%; Keybot for 2014 = +8.9%)(Actual this trade = +2.3%; Actual for 2014 = +9.7%)

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.