Sunday, January 3, 2021


Keybot theQuant remains on the short side through the end of the year and to begin the first day of trading in 2021. The bears are in control of the stock market direction but the algo number is only 2 measly points below the signal line. The SPX prints a new all-time record high at 3760.20 and all-time closing high at 3756.07 both on Thursday, 12/31/20, the last day of trading for the year. The House is a Rockin'.

It is interesting that the quant is short as the stock market prints a new record high; that may have never happened before in the history of the algorithm. This price behavior verifies uber euphoric bullishness in the stock market.

The bears need weaker retail stocks, higher volatility, and weaker utilities to create market mayhem. Bears need RTH below 155.25 and/or VIX above 25.19. Stocks will immediately begin falling apart if either of these parameters occur. If both occur, that would be Double Trouble and Stevie Ray would begin to play. If both remain bullish, the bears got nothing. If stocks rally but one of the two parameters turns bearish, the stock market will turn around and drop. If stocks sell off but neither of the two parameters turn bearish, stocks will turn around and rally again. RTH is heavily impacted by AMZN so keep an eye on Scamazon and King Bezos.

Utilities. This is exciting stuff. The stock market is likely placing an epic top in Q1. Keybot, however, only sees 1's and 0's so it will be doing its own thing. Once the market sells off, utes will tell you if it truly is a significant multi-month top, or, if it is a run-of-the-mill garden-variety pullback followed by a sharp recovery. UTIL 829 is the bull-bear line in the sand for the week ahead with price starting at 865. If 829 fails this week, stocks are in big trouble. Next week, UTIL 832.49 is the key bull-bear line in the sand. For the week of 1/18/20, UTIL 876 is key.

Within the next 10 trading days, UTIL must be above 876 and remain above heading higher, otherwise stocks are in trouble. If stocks are tumbling lower for a few weeks, and if UTIL drops below 829-ish anytime ahead, that tells you there is likely long-term damage ahead. If UTL drops below 8 hundo, there is definitely stock market damage occurring and it will be long-term sustainable. If UTIL loses that 780-790 area, the stock market would be highly susceptible to a major crash. Thus, watch the utes closely.

Keybot prints one pre-scheduled number this week on Friday morning. The algo has been very quiet over the last month but you know how that goes. Out of nowhere it can explode into craziness spitting out numbers left and right. The Georgia runoff elections are Tuesday and Congressional ratification meeting affirming Biden as the 46th POTUS is on hump day. There will likely be theatrics on both days and the whole week for that matter into the critical US Monthly Jobs Report on Friday morning.

1/10/21; 7:00 PM EST =
1/8/21; 9:00 AM EST =
1/1/21; Begin 2021 Data Set = +67; signal line is +69; go short 3756; (Benchmark SPX for 2021 = 0%)(Keybot algo this trade = 0%; Keybot algo for 2021 = 0%)(Actual trading results this trade = 0%; Actual trading results for 2021 = 0%)

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