STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant flips to the long side after the opening bell this morning at SPX 1938. The erratic market action continues. The algorithm identifies copper and volatility as the two key parameters most impacting market direction. If JJC remains above 23.80 and VIX under 19.45, the bulls will keep floating the stock market higher. If either parameter flips to the bear camp, the stock market rally is over. If both flip to the bear camp, stocks will begin falling in earnest and Keybot may flip short if the SPX drops under 1925. For now, however, the bulls are comfortably in control with the algo number 24 points above the signal line.

For the SPX starting at 1952, the bulls only need a smidge of green in the overnight S&P futures and bingo, stocks will accelerate higher after the opening bell. The bears need to push the SPX under 1925 to regain their mojo. A move through 1926-1951 is sideways to end the week.

On the last trade, a very short term trade, the algo loses -0.4% and the actual trading loses -0.8%. The model does not consider the quick flip back to the long side a whipsaw since it occurred beyond a 10-hour trading time range. Therefore, Keybot remains in the double ETF's and exits SDS and enters SSO. This behavior is cautionary, however, and if trading the market it is likely prudent to stay away from leveraged vehicles in this choppy environment. Keybot only sees 0's and 1's so it remains in the 2x ETF's, for now. It will be interesting to see if a whipsaw occurs tomorrow, or not. The actual trading is up +14% after only 7 weeks of trading but the whole year will have to play out. The benchmark SPX is down more than -5% so far this year.

JJC 23.80 and VIX 19.45 will tell you the market direction story for Friday. Keybot prints a pre-scheduled number one-half hour after the opening bell tomorrow.

2/28/16; 7:00 PM EST =

2/26/16; 10:00 AM EST =

2/25/16; 3:59 PM EST = +35; signal line is +11

2/25/16; 1:27 PM EST = +21; signal line is +9

2/25/16; 11:21 AM EST = +5; signal line is +8 but algorithm remains long

2/25/16; 10:23 AM EST = +21; signal line is +7

2/25/16; 10:12 AM EST = +5; signal line is +5 but algorithm remains long

2/25/16; 9:34 AM EST = +21; signal line is +4; go long 1938; (Benchmark SPX for 2016  = -5.2%)(Keybot algo this trade = -0.4%; Keybot algo for 2016 = +8.1%)(Actual results this trade = -0.8%; Actual results for 2016 = +13.7%)

2/24/16; 2:35 PM EST = +21; signal line is +3 but algorithm remains short

2/24/16; 2:15 PM EST = +5; signal line is +2 but algorithm remains short

2/24/16; 9:36 AM EST = -11; signal line is +1

2/23/16; 12:01 PM EST = +5; signal line is +1 but algorithm remains short

2/23/16; 10:20 AM EST = -11; signal line is +0; go short 1930; (Benchmark SPX for 2016  = -5.6%)(Keybot algo this trade = +1.5%; Keybot algo for 2016 = +8.5%)(Actual results this trade = +3.1%; Actual results for 2016 = +14.5%)