STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short as the bull-bear battle continues. Bulls are jamming futures higher with lower volatility. The Federal Reserve is always at the ready to place their jack boots on the throat of volatility to support the stock market.

Keybot is tracking VIX 15.93 as the key bull-bear line in the sand. The VIX is currently trading at 16.07, teasing the psychological support at 16 this morning, Tuesday, six hours before the opening bell for the regular US trading session. It's all about vol. Stock market bulls win if the VIX drops below 15.93. Bears will remain in control of the stock market direction if the VIX remains above 15.93.

If VIX falls below 15.93, consider that the imminent turn to the long side is in play, and if the SPX moves above 2984, it is likely that Keybot will flip long. S&P futures are up +12. The SPX begins today at 2977 so if the futures hold in place, the S&P 500 will move handily above 2984. It's all about volatility; VIX 15.93 tells the market story today.

Keep an eye on the banks. Bears need XLF below 27.55. If the financials become soggy, that would be bearish for stocks, however, if the banks have a big up day, that will likely point to bullish joy for the days ahead.

September and Q3 ends yesterday (EOM, EOQ3) and the first day of October trading is set to begin. New money usually flows into equities to begin a quarter and may account for some of the buoyancy in the US futures. Watch VIX 15.93; it tells you everything you need to know.

10/4/19; 9:00 AM EST =

9/30/19; 7:00 PM EST EOM EOQ3 = +42; signal line is +55

9/29/19; 7:00 PM EST = +42; signal line is +55

Note Added 4:53 AM EST: The VIX drops to 15.98 but recovers to 16.11. S&P futures +11. The bulls, and central bankers, keep jamming vol lower to send futures higher and came to within a nickel of all-out victory. VIX 15.93 is all that matters today.