Sunday, November 2, 2014


Keybot the Quant remains long moving into the new week of trading. The bulls have the ball although the bears narrow the gap between the algo number and signal line by two ticks with the Sunday pre-scheduled number. The key to Monday is whether the upside euphoric stock market rally is verified by volatility and/or copper, or not. The algo is tracking VIX 13.94 and JJC 37.15 as two bull-bear lines in the sand and the most influential parameters on market direction currently. So watch copper trading overnight to provide a hint on market direction (stocks will move in the same direction as copper).

Most importantly is VIX 13.94 since price begins at 14.03 only nine pennies on the bear side. Remember, volatility moves inverse to the stock market. As volatility goes, the stock market will move the other way. If VIX drops under 13.94, the bulls will have the bears head hanging as a trophy above the mantle as the stock market catapults wildly higher. The stock market is topped out if VIX stays above 13.94.

For the SPX starting at 2018, only one-point from a new all-time record high, the bulls only need to see a smidge of positivity in the overnight S&P futures and the SPX will accelerate several handles higher after the opening bell. The bears need to push under 2001 to get their mojo back. A move through 2002-2018 is sideways action to begin the week. Volatility will provide the market direction answer for Monday. Keybot prints one pre-scheduled number this week on Friday morning.

11/9/14; 7:00 PM EST =
11/7/14; 9:00 AM EST =
11/2/14; 7:00 PM EST EOM = +46; signal line is +28
10/31/14; 10:00 AM EST = +46; signal line is +26

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