Keybot the Quant remains short. Isn't it amazing after five weeks we finally see what the Keybot algorithm has seen all along? The algo would not flip long this year as the upside joy in stocks occurred through January. It was the strangest behavior of the Keybot the Quant algorithm in its over one-decade existence.
It all finally makes sense. The robot was smart enough to know it did not want to go long since there was a huge risk to the downside, which ended up occurring. It is amazing. All that Keybot sees is 1's and 0's. Robots are smarter than humans. Keybot did not gain anything during the January rally but it did not lose anything either on the crash. The algo is designed to seek the smoothest path possible through the trading year.
It all finally makes sense. The robot was smart enough to know it did not want to go long since there was a huge risk to the downside, which ended up occurring. It is amazing. All that Keybot sees is 1's and 0's. Robots are smarter than humans. Keybot did not gain anything during the January rally but it did not lose anything either on the crash. The algo is designed to seek the smoothest path possible through the trading year.
As mentioned in nearly every message over the last month, these are not your grandfather's markets. Something special was occurring as pointed out with the volatility since December. Now we see what the story was after the historic flash crash yesterday afternoon and the ongoing sickness. The SPX is negative on the year.
Well, what happens next? You saw a day ago that copper rallied but what hurt the stock market was the semiconductors that failed at the opening bell. Then the banks failed and the retail stocks are the latest to fail. The bears remain in control with the algo number 26 points below the signal line.
Looking at the algo, the key parameters most impacting stock market direction currently are retail stocks and copper both in the bull camp. Bears need RTH under 94.68 to create more stock market downside. Bears also need JJC below 36.17 to create more market carnage. If both fail that will be a bloodbath lower for equities.
The bulls need to keep RTH above 94.67 and JJC above 36.17. This will stabilize the stock market. Then, if the banks and semiconductors move higher, the stock market will recover with a relief rally.
On Tuesday, today, going into munchtime on the US East Coast, RTH is at 94.79. Bears need another 12 pennies lower to create a stock market downleg. JJC is at 36.34 so bears need another 17 cents lower for copper. The beat goes on.
2/11/18;
7:00 PM EST =
2/6/18; 9:49 AM EST = +22;
signal line is +48
2/6/18; 9:36 AM EST = +6;
signal line is +49
2/5/18; 3:00 PM EST = +22;
signal line is +51
2/5/18; 11:36 AM EST = +38;
signal line is +52
2/5/18; 10:11 AM EST = +54;
signal line is +53 but algorithm remains short
2/5/18; 9:36 AM EST = +38;
signal line is +53
2/4/18;
7:00 PM EST = +54; signal line is +54 but algorithm remans short
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.