Sunday, November 27, 2016


Keybot the Quant remains long moving into the new week of trading. The Trump Rally has created parabolic moves in the major indexes. Market bulls need higher commodities and utilities to keep the party going. Bears need  higher volatility.

Watch GTX 2249. Price collapsed down through on Friday and it was surprising to see the up day in stocks. The 'day after Thanksgiving' positive seasonality, where that day is the most up day of the entire year, won out instead. GTX is at 2234 so the expectation would be for stocks to soften. Bulls need to push GTX above 2249 to prove that stocks will continue higher, if not, equities will likely become soggy. Bulls can also achieve more upside juice for the stock market if UTIL moves above 653; this would be a big deal. If UTIL stays below 653, it remains an ominous indicator for the intermediate term ahead.

The market bears need higher volatility. The low VIX slaps the bears around each day. Slap, slap. The stock market will weaken and sell off if VIX moves above 13.85. Overall, the bulls remain in good shape. Even if VIX fails, the algo will likely remain long. Watch for any joggy price action at the GTX 2249 and VIX 13.85 levels. If price moves across these key levels, then back to the other side, then back again, etc.... This behavior would hint that the algorithm is sensing a move to the short side on the come.

For Monday with the SPX starting at 2213, the highest level in all-time history, the bulls need any smidge of green in the overnight S&P futures and price will jump several handles after the opening bell towards 2220 printing more record highs. The bears need to push under 2206 to quickly accelerate the downside to a test of the psychological 2200 level. A move through 2207-2212 is sideways action to begin the week. This is a tight 5-point range so instead price will likely seek to exit one side or the other.

Keybot prints three pre-scheduled numbers this week one each on Tuesday, Wednesday and Friday. The EOM (end-of-month) is Wednesday. The bulls remain in control.

12/4/16; 7:00 PM EST =
12/2/16; 9:00 AM EST =
11/30/16; 7:00 PM EST EOM =
11/29/16; 10:00 AM EST =
11/27/16; 7:00 PM EST = +51; signal line is +34
11/25/16; 11:19 AM EST = +51; signal line is +33
11/23/16; 10:00 AM EST = +65; signal line is +32

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