Keybot the Quant is on the long side as markets chop along sideways. The stock market is a coin-flip as evidenced by the algo number only 2 points above the signal line. The three key parameters controlling broad stock market direction currently are volatility, banks and copper as the previous comments highlight. The VIX came down to the 200-day MA at 11.15 and bounced. When that occurred you knew the bulls did not have the juice to take the stock market higher.
Bears need XLF under 26.00 and/or JJC under 34.79 for the stock market to begins selling off in force. XLF price came down to 26.00-26.03 on Friday and JJC down to 34.79-34.83, testing both levels that Keybot called out ahead of time but prices bounced off both of the key bull-bear lines in the sand so you knew that the market bears did not have the juice to take the stock market lower. Hence, sideways choppy slop. The S&P 500 has basically chopped sideways through the tight 2560-2590 range for the last six weeks.
Bulls need VIX under 11.15 to prove they can take stocks higher and if VIX falls below 10.67, stocks will catapult higher with the SPX leaping above 2600.
Bears need XLF under 26.00 and/or JJC under 34.79 to create stock market selling. If either parameter turns bearish, only one is necessary, and the SPX falls below 2578, Keybot will likely flip to the short side.
One of these three parameters volatility, banks or copper will flinch and that will immediately tell you the direction of the stock market ahead.
Keybot prints one pre-scheduled number this week on Wednesday morning. The stock market is closed on Thursday for the Thanksgiving Day holiday. Friday is a shortened session closing at 1 PM EST. Watch copper futures trading into Monday morning as well as listening for any news concerning the banks to provide hints on the path ahead for the US stock market.
11/26/17;
7:00 PM EST =
11/22/17;
10:00 AM EST =
11/19/17; 7:00 PM EST =
+86; signal line is +84
11/17/17;
9:00 AM EST = +86; signal line is +84
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