STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant flips to the long side shortly after this morning's opening bell at SPX 2204. The low volatility slapped the bears in the face. Slap, slap. The VIX 13.90 level is key. Bulls rule below VIX 13.90 while market bears rule above VIX 13.90. VIX is at 12.17.

Bears need the higher volatility and will also benefit from lower retail stocks (RTH 77.17 is the current bull-bear line in the sand) and lower chips (SOX 836 is a bull-bear line in the sand). Bulls need to maintain the low volatility and sends utilities higher, UTIL above 655, to gather more upside steam for stocks.

For the SPX starting at 2205, the bulls need to move above 2209 and it is off to the races higher. The bears need to push under 2200 to regain their mojo. A move through 2201-2208 is sideways action for Tuesday.

Watch VIX 13.90. If VIX moves above 13.90, consider the imminent turn to be in play, and if the SPX then falls under 2200, Keybot will likely whipsaw back to the short side. This is the mirror image set up of the prior day. Stay alert for a whipsaw especially with the current erratic and unstable markets.

The S&P 500 benchmark index is up +7.8% this year. During the last two-day trade, the Keybot computer program lost one-half percent and is up +15% on the year double the benchmark. The actual trading is punished more than -2% on the last trade due to the larger and more violent moves with leveraged ETF's. Keybot exits TWM and enters UWM. The actual trading is up +37% on the year. The year likely has more drama yet to play out during the next four weeks.

12/11/16; 7:00 PM EST =

12/9/16; 10:00 AM EST =

12/5/16; 9:47 AM EST = +66; signal line is +58; go long 2204; (Benchmark SPX for 2016 = +7.8%)(Keybot algo this trade = -0.5%; Keybot algo for 2016 = +14.8%)(Actual results this trade = -2.3%; Actual results for 2016 = +37.0%)

12/5/16; 9:36 AM EST = +66; signal line is +58 but algorithm remains short

12/4/16; 7:00 PM EST = +52; signal line is +58

12/2/16; 1:10 PM EST = +52; signal line is +58

12/2/16; 12:52 PM EST = +66; signal line is +58 but algorithm remains short

12/2/16; 12:42 PM EST = +52; signal line is +58

12/2/16; 10:45 AM EST = +66; signal line is +59 but algorithm remains short

12/2/16; 9:00 AM EST = +52; signal line is +58

12/1/16; 3:59 PM EST = +52; signal line is +58

12/1/16; 3:15 PM EST = +36; signal line is +58

12/1/16; 12:58 PM EST = +52; signal line is +58; go short 2193; (Benchmark SPX for 2016 = +7.3%)(Keybot algo this trade = +3.6%; Keybot algo for 2016 = +15.3%)(Actual results this trade = +22.3%; Actual results for 2016 = +39.3%)