Saturday, March 30, 2019


Keybot the Quant remains long. The banks are unable to push XLF above 25.85 so the jury remains out as to whether the bulls can take the stock market higher. The SPX gains 17 points to 2834 on Friday which is surprising considering the lackluster banks, however, the market makers jammed the SPX 8 points higher in the last few minutes of trading.

The Keybot algo prints the epic +100 maximum reading several times over the last couple years; 3/11/19-3/21/19, 9/20/18-10/3/18, 12/15/17-12/18/17, 9/12/17-11/28/17, 7/25/17, 5/23/17-5/25/17 and 12/19/16-3/5/17 (the +100 readings are not everyday but occur during these time periods). The stock market reaction to the +100 readings from a week ago have yet to play out.

Interestingly, the +100 readings last Fall top-ticked the stock market; it was all downhill in Q4 2018 after that. The late 2017 +100 readings foretold of the January 2018 stock market top and collapse. The September to November 2017 +100 readings occur as the SPX was ramping parabolicly higher. The September to December 2017 readings can be looked at as a precursor to the January-February 2018 crash.

The 7/25/17 +100 tick occurred and resulted in about a 70-point drop in the SPX for a couple weeks. The May 2017 +100 ticks result in a 45-point drop in the SPX. The late-2016 early 2017 +100 top ticks result in a 70-point drop in the SPX. So the pullbacks after the +100 readings were on the mild side in 2017 but have become more serious as time moves along to the present day. The +100 readings did result in pullbacks in all cases either minor 40 to 70-point losses in the S&P 500 or bigtime crashes a la January 2018 and Q4 2018.

The +100 ticks may print from zero to 3 months before they create stock market trouble (the first +100 recent tick is 3/11/19 three weeks ago). The Keybot the Quant algorithm is an oscillator at its heart so think of the +100 level as a maximum overbot level for the stock market (rampant euphoria and market joy).

The last +100 tick is 3/21/19 about 10 days ago. It appears the stock market trouble begins either coincidentally or within a month or so of the last +100 top-tick. Judging from the prior data for the algorithm, the stock market may be headed for a fall, perhaps serious drop, at anytime forward. Keybot, however, is a robot and only sees 1's and 0's so time will tell. If you are in the market, you need to stay focused and alert. 

3/31/19; 7:00 PM EST EOM EOQ1 =
3/29/19; 10:00 AM EST = +84; signal line is +75

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