Sunday, November 13, 2016


Keybot the Quant remains long moving into the new week of trading. Today's weekly Sunday number flips the algo number one point above the signal line so the bulls are happy. On Friday, you saw semiconductors, SOX, gap-up at the opening bell so you knew the bears did not have a lot of juice. Despite that, the SPX did drop to test the 2151-2152 called out by the robot ahead of time, and bounced. The bears did not have enough downside strength so the bulls rule.

Volatility and retail stocks are key. Market bulls need either VIX below 13.91 and/or RTH above 76.62. If either occurs, the bulls are in clover. There are many retail stocks reporting earnings this week that will create drama.

Volatility will tell you the market direction story tomorrow morning. VIX begins at 14.17 very close to the 13.91 bull-bear line in the sand. VIX begins trading 3 AM EST so in the early morning hours a hint will be provided as to the path forward. VIX in the 14-15 area is status quo and stocks stagger choppy sideways. Under 13.91 and the bulls rejoice as the stock market rockets higher. Bears need VIX above, 15, 16 and higher to create market angst.

For the SPX starting at 2164, the bulls need two points to push above 2166 and an upside acceleration will occur. Bears need to push under 2152 to regain their mojo. A move through 2153-2165 is sideways action to begin the week.

Keybot prints one pre-scheduled number this week on Thursday morning. The bulls remain in charge but the one-point difference in the algo number and signal line signal a toss-up concerning the path ahead as the bulls and bears are in an intense struggle for control here forward.

Bears need higher volatility and weak retail earnings. Bulls need VIX under 13.91 and the upside party continues.

11/20/16; 7:00 PM EST =
11/17/16; 9:00 AM EST =
11/13/16; 7:00 PM EST = +18; signal line is +17
11/11/16; 10:00 AM EST = +18; signal line is +18 but algorithm remains long
11/10/16; 11:27 AM EST = +17; signal line is +18 but algorithm remains long

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