STOCK MARKET BULLISH -- LONG -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant remains long but there may be market turmoil afoot. The bulls are in charge with the algo number 13 points above the signal line. However, utilities are sick and as mentioned last week, UTIL 876.46 is an important bull-bear line in the sand. UTIL begins the week at 867 so it will fail when trading begins for the regular session at 9:30 AM EST. This will place Keybot in position to go short. The bulls must jam utilities strongly higher Monday morning or stocks are going to trail lower for an extended period.

Higher volatility will also help the bear case. Bears need VIX above 14.39 to create serious market negativity. Then, if the VIX pops above 15.03, equities will be falling apart in earnest. If either VIX moves above 14.39, or UTIL below 876.46, either one will do, and the SPX drops below 3222, Keybot will likely flip short. Bears will benefit from a slow and steady move lower in the SPX rather than a gap-down at the opening bell which may trigger a timer that will delay the move to the short side for about 90 minutes.

Bears will also benefit if RTH (retail stocks) drops below 119.10 and/or CPER below 17.11 (a -2% drop in copper futures). If these parameters turn bearish, stocks will be deteriorating fast to the downside.

The bulls must keep VIX below 14.39 and at the same time push UTIL above 876.46 as fast as possible, otherwise, they are in big trouble. Keybot prints one pre-scheduled number this week on Friday morning.

S&P futures are down -12 on Sunday evening on the East Coast USA. That is the exact amount the SPX cash index needs to drop at Monday's opening bell to get Keybot to flip short (sub SPX 3222). Monday may be an exciting turn day. Copper futures are down -0.4%.

Volatility and utilities are impacting stock market direction more than any other parameter currently, then followed by retail stocks and copper. Monday begins the first full trading week of 2020 and most traders will be back at work after the holidays. The party's over.

UTIL 876.46, VIX 14.39 and SPX 3222 tell you everything you need to know for Monday. Markets remain erratic and unstable.

1/12/20; 7:00 PM EST =

1/10/20; 9:00 AM EST =

1/5/20; 7:00 PM EST = +88; signal line is +75

1/3/20; 9:41 AM EST = +88; signal line is +75