Keybot the Quant flips to the long side in the final minutes of trading on Tuesday, 3/10/20, at SPX 2875. The utilities are the key driver of broad stock market direction currently. S&P futures are tanking a hundo points one-half hour before the opening bell for the regular Wednesday, 3/11/20, US trading session. VIX is above 54 so there is panic in the air.
Bears need UTIL below 851.72 (now at 860) which would create an immediate deterioration in the stock market. Bears then need UTIL to fall through 847 which is a trap-door for the stock market. There will be near-term bloodiness (a crash scenario would be on the table) and long-term negativity if UTIL loses 847 and remains below. If you see this low for UTIL tested and a bounce occurs, you are relatively sure that the relief rally for the stock market is beginning.
Bulls need SPX above 3000 as soon as possible. This will go a long way to indicating that up is the direction forward for equities.
If one or both of the utility parameters fail above, Keybot will be champing at the bit to whipsaw back to the short side but will likely need to see the SPX below 2734 which is 148 points below the current SPX price at the 2882 palindrome. S&P futures need another 50 points of negativity to get down toward that level.
SPX 3000 (bulls win), UTIL 851.72 and UTIL 847 (bears win) are the only three parameters that matter. All else is noise. If stocks sell off as the futures indicate but the utes remain firm and do not fail, the bulls will come in and buy the dip and launch a relief rally. Likewise, if there is a bloodbath of selling, and the utes fail, but minutes later the utes recover, same dealio, stocks will likely recover. Bulls would not receive a strong all-clear signal, however, until the SPX regains 3K.
On the last trade that ran for about 3 weeks, the Keybot computer program gains about +10% and the actual trading gains +8%. The PSQ ETF underperforms because many traders still believe in tech and keep buying any little dips. The benchmark S&P 500 is down -11% this year thus far, that is a big change from last year's joy, while the actual trading generated by Keybot the Quant is up over +14% after two months of trading. That is a 25 percentage-point difference in performance. Keybot exits PSQ and enters SSO returning to the 2x leveraged ETF's after the whipsaw timer expired. If the algorithm flips short in quick order that would drop the quant back down into 1x ETF mode. For now, Keybot is dancing with the devils with the double-leveraged long SSO ETF as the futures tank. There will be huge intraday and day to day moves continuing as long as the VIX remains elevated.
Keybot prints a pre-scheduled number tomorrow morning, Friday the 13th, shortly after the opening bell. The beat goes on.
3/15/20;
7:00 PM EST =
3/13/20;
10:00 AM EST =
3/10/20; 3:54
PM EST = -20; signal line is -26; go long 2875; (Benchmark SPX for 2020
= -11.0%)(Keybot algo this trade = +11.0%; Keybot algo for 2020 = +9.9%)(Actual
trading results this trade = +8.0%; Actual trading results for 2020 = +14.2%)
3/10/20;
3:44 PM EST = -36; signal line is -27
3/10/20;
3:35 PM EST = -52; signal line is -28
3/10/20;
3:23 PM EST = -36; signal line is -28
3/10/20;
11:28 AM EST = -52; signal line is -28
3/10/20;
11:24 AM EST = -36; signal line is -27
3/9/20;
3:28 PM EST = -20; signal line is -26 but algorithm remains short
3/9/20;
2:59 PM EST = -36; signal line is -25
3/9/20;
2:35 PM EST = -52; signal line is -24
3/9/20;
2:20 PM EST = -36; signal line is -21
3/9/20;
2:08 PM EST = -52; signal line is -20
3/9/20;
1:55 PM EST = -36; signal line is -18
3/8/20;
7:00 PM EST = -20; signal line is -16
3/6/20;
9:36 AM EST = -20; signal line is -15
3/6/20;
9:00 AM EST = -6; signal line is -14 but algorithm remains short
3/5/20;
3:37 PM EST = -6; signal line is -12 but algorithm remains short
3/5/20;
3:17 PM EST = -20; signal line is -11
3/4/20;
9:36 AM EST = -6; signal line is -9 but algorithm remains short
3/3/20; 3:59 PM EST = -20; signal line is -6
3/3/20;
3:06 PM EST = -6; signal line is -4
3/3/20;
2:05 PM EST = -20; signal line is -1
3/2/20;
3:06 PM EST = -6; signal line is +2
3/2/20;
2:41 PM EST = -20; signal line is +4
3/2/20;
11:16 AM EST = -6; signal line is +7
3/2/20;
10:33 AM EST = -20; signal line is +9
3/2/20;
10:06 AM EST = -36; signal line is +12
3/2/20;
9:59 AM EST = -20; signal line is +14
3/2/20; 9:36 AM EST = -36; signal line is +15
3/1/20; 7:00 PM EST EOM = -52; signal line is +18
2/28/20;
10:00 AM EST = -52; signal line is +21
2/28/20;
9:44 AM EST = -52; signal line is +24
2/28/20;
9:36 AM EST = -36; signal line is +27
2/27/20;
3:57 PM EST = -20; signal line is +29
2/26/20;
11:49 AM EST = -6; signal line is +31
2/26/20;
11:23 AM EST = +8; signal line is +33
2/26/20;
11:13 AM EST = -6; signal line is +33
2/26/20; 10:32 AM EST = +8; signal line is +35
2/25/20;
1:21 PM EST = -6; signal line is +35
2/25/20;
10:51 AM EST = +8; signal line is +37
2/25/20;
10:42 AM EST = +24; signal line is +38
2/25/20;
10:35 AM EST = +8; signal line is +37
2/25/20; 10:00 AM EST = +24; signal line is +37
2/24/20; 12:10
PM EST = +24; signal line is +37; go short 3229; (Benchmark SPX for 2020
= -0.1%)(Keybot algo this trade = -1.8%; Keybot algo for 2020 = -1.1%)(Actual
trading results this trade = -1.6%; Actual trading results for 2020 = +6.2%)
