Sunday, May 31, 2020

STOCK MARKET BULLISH -- LONG

Keybot the Quant remains long. The bulls rule, however, the commodities and utilities remain in the bear camp. Traders believe in the Federal Reserve and other central banks that are goosing markets with easy money. The party is in full swing. The bulls are in charge with the algo number 35 points above the signal line. The jump in the banks creates more upside fuel.

The bears need the SPX below 2995 (starting the week, and June, at 3044) pronto or they will be slapped around day after day going forward. The bulls need to keep elevating the NYA day after day to keep the stock market rally going. Equities will roll over if the NYA index stalls and drops.

Utilities are important over the next two weeks. UTIL 839 is a key bull-bear line in the sand. Price is at 807 now after a big jump last week. If UTIL takes out 839 to the upside, the stock market is guaranteed to move far higher. If UTIL fades away and trades lower day after day, that is a very bad sign for the stock market. If UTIL rallies this week for a few days, and even into the following week, and teases that 839 level, but ultimately fails to attain the level, stalls, and begins dropping again, that is a very bad sign for the stock market. Both of the latter cases open up equities to a crash scenario. 

Keybot prints a pre-scheduled number this week on Friday morning before the opening bell. The bulls are in control happy to have the Fed on their left shoulder, printing money in the basement of the Eccles Building like madmen, and King Donnie on their right shoulder, promising coronavirus (COVID-19) vaccine cures in only a few weeks time. Virus, schmirus. Protests, schmotests. Recession, schmession. Traders and investors are convinced that the Fed can send the stock market higher forever always rewarding the wealthy class. There may be an interesting week ahead perhaps an epic and historic week.

6/7/20; 7:00 PM EST =
6/5/20; 9:00 AM EST =
5/31/20; 7:00 PM EST EOM = +7; signal line is -28
5/29/20; 10:00 AM EST = +7; signal line is -30
5/27/20; 12:16 PM EST = +7; signal line is -31

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