Wednesday, December 23, 2020


Keybot the Quant is short with the algo printing one number in the Tuesday session. The bears are in control of the stock market direction albeit the algo number is only 1 single point below the signal line.

Bears need to push the VIX above 25.31, or RTH below 154.73, or UTIL below 830, to create market mayhem. The amount of selling is proportional to whether one, two or all three parameters fail. VIX is at 23.40 so bears need a couple-point pop. A failure of the utilities will be a significant development for the stock market since it will hint that the selling next year will be very long term multi-month or longer.

It is interesting that despite the all-time record highs in stocks, the bulls do not have much fuel to move higher. The SPX needs to push above 3698 which would provide another spurt above 3700 but that may be short-lived. Consumer Sentiment is released this morning and it is critical for bulls that it be a strong number moving higher. A weak number may start to roll the markets over to the downside. The SPX begins the day at 3687 so +11 points are needed to make for happy bulls and S&P futures are up, well, +11. Of course they are. 

Watch VIX 25.31 and RTH 154.73 to see if the bears got game. Watch AMZN since it will greatly impact RTH.

12/27/20; 7:00 PM EST =
12/23/20; 10:00 AM EST =
12/22/20; 10:00 AM EST = +67; signal line is +68
12/22/20; 3:22 AM EST = +72; signal line is +68 but algorithm remains short

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