STOCK MARKET BEARISH -- SHORT -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant flips back to the short side yesterday at SPX 4660 as the choppy whipsaw slop continues. Chop suey. Retail stocks failed yesterday stopping the stock market rally and then volatility spiked late day triggering the turn to the short side.

Bears need weaker chips to prove they got game. Bears need SOX below 3788 which will kick in serious stock market selling action.

Bulls need to retrace yesterday's retail stocks and volatility failures to regain control. Bulls need VIX below 19.39 and RTH above 190.00. VIX is trading right now in the early morning hours East Coast time at 20.24 so the bears are smiling. VIX 19.39 is the tell.

If volatility weakens and VIX loses 19.39 anytime this morning, the bulls will be staging a comeback. If stocks rally, but the VIX does not drop below 19.39, the bulls got nothing and stocks will reverse and fall apart. If there is bad news in semiconductor land and chip stocks are soggy, that hints that the stock market will fall apart.

On the last trade, another whipsaw that only lasted a couple days (but not quantified as a whipsaw as per the quant), the Keybot the Quant computer program and the actual trading are flat. The benchmark S&P 500 is down -2.2% on the year thus far. The quant program is down -4.4% and the actual trading is down -2.5% in 2022. The year begins on the soggy-side. Keybot exits DIA and enters DOG.

The stock market remains erratic, choppy and unstable. Volatility, retail stocks and chips tell you everything you need to know for today. S&P futures are up +4 with VIX at 20.10. Futures were up over +10 a few minutes ago.

As a side note, the VIX failed yesterday at about SPX 4673-ish so bears may be okay up to the 4672-4674 range but above there the bulls would likely take over. Watch VIX 19.39.

1/16/22; 7:00 PM EST =
1/14/22; 10:00 AM EST =
1/13/22; 3:50 PM EST = +58; signal line is +66; go short 4660; (Benchmark SPX for 2022 = -2.2%)(Keybot algo this trade = -0.4%; Keybot algo for 2022 = -4.4%)(Actual results this trade = +0.2%; Actual results for 2022 = -2.5%)
1/13/22; 3:16 PM EST = +58; signal line is +67 but algorithm remains long
1/13/22; 12:21 PM EST = +72; signal line is +67
1/12/22; 3:41 PM EST = +88; signal line is +67
1/12/22; 3:11 PM EST = +72; signal line is +66
1/12/22; 2:21 PM EST = +88; signal line is +66
1/12/22; 1:56 PM EST = +72; signal line is +66
1/11/22; 11:33 AM EST = +88; signal line is +66
1/11/22; 11:28 AM EST = +72; signal line is +66; go long 4679; (Benchmark SPX for 2022 = -1.8%)(Keybot algo this trade = -1.1%; Keybot algo for 2022 = -4.0%)(Actual results this trade = -1.1%; Actual results for 2022 = -2.7%)

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant whipsaws back to the long side this morning at SPX 4679. The bulls throw a huge party with the Fed refilling the punchbowl and all 4 negative parameters flip back to the bull side catapulting stocks skyward creating the whipsaw. Do not be surprised if the stock market whipsaws back to the short side over the next day or two.

That was a wild, wild move. Bears got nothing unless they reverse 2 of the following 4 parameters; RTH 190.00, VIX 19.36, SOX 3787 or CPER 26.72. The stock market rally stops if 1 of the 4 flips. Downside in stocks begins with 2 flipping bearish. Bulls are on easy street if all 4 remains bullish. The parameters should flip negative in the order shown, when they decide to flip bearish.

On the last trade, a whipsaw 1-day wonder, the Keybot the Quant program and actual trading both lose a percent with the program down -4% on the year thus far and the actual trading down -3% in 2022. The benchmark SPX is down -2% so far this year. Since the quant whipsawed again, the robot will remain in single 1x ETF's until the second week of February. Markets are choppy and erratic, that is obvious so far this week. Choppy markets chew-up bulls and bears alike so the robot drops down into 1x ETF's until the price action stabilizes. Chop suey. Keybot the Quant exits SH and enters DIA.

Retail stocks, volatility, chips and copper are controlling stock market direction currently.

1/16/22; 7:00 PM EST =
1/14/22; 10:00 AM EST =
1/11/22; 11:33 AM EST = +88; signal line is +66
1/11/22; 11:28 AM EST = +72; signal line is +66; go long 4679; (Benchmark SPX for 2022 = -1.8%)(Keybot algo this trade = -1.1%; Keybot algo for 2022 = -4.0%)(Actual results this trade = -1.1%; Actual results for 2022 = -2.7%)
1/11/22; 10:07 AM EST = +56; signal line is +66
1/11/22; 10:03 AM EST = +42; signal line is +67
1/11/22; 9:46 AM EST = +26; signal line is +69
1/11/22; 8:39 AM EST = +42; signal line is +71
1/11/22; 4:14 AM EST = +56; signal line is +73
1/10/22; 3:59 PM EST = +42; signal line is +74
1/10/22; 9:36 AM EST = +26; signal line is +75; go short 4630; (Benchmark SPX for 2022 = -2.9%)(Keybot algo this trade = -2.9%; Keybot algo for 2022 = -2.9%)(Actual results this trade = -1.6%; Actual results for 2022 = -1.6%)

STOCK MARKET BEARISH -- SHORT

Keybot the Quant turns bearish at the opening bell at SPX 4630 as the stock market fell out of bed. Volatility, chips, retail stocks and copper cause the selloff. Stocks are trying to recover so they need to win back these 4 parameters to stop the selling and stabilize the collapse.

The machines are driving the semiconductors higher and volatility lower to create the afternoon rally right now. The SPX is back up to 4646 but the 4 parameters remain bearish so the bulls got buptkis. Bulls need VIX below 19.40, SOX above 3783, RTH above 189.60 and CPER above 26.72. Any one of these turning bullish will immediately halt the selloff. Any rally's strength can be determined by how many of the 4 parameters turn bullish.

The bears need the NYA to drop below 16678 (now at 17071). If the NYA fails, a serious and significant down move will occur in the stock market. If stocks flounder and meander sideways not knowing which direction to choose, a rally will occur unless the NYA 16678 fails.

The Martin Luther King Jr holiday is on Monday so stocks may be buoyant on Thursday and Friday.

The year begins on a downbeat with the benchmark S&P 500 index, the SPX, down -2.9% in 2022 thus far. The Keybot the Quant program loses -2.9% out of the gate and the actual trading loses -1.6% to begin the year. The technicals had to be rezeroed for the new year so the trade was actually successful based on the original entry. In other words, last year received a couple percent in profit at the expense of this year. No worries. There is over 11-1/2 months left in the year. The quant remains in the single 1x ETF's due to the whipsaw timer in December. If the algo flips back next week it will likely return to the 2x ETF's. Keybot exits SPY and enters SH.

2022 is off and stumbling. The beat goes on.

As all that windbag stuff is typed, they are having trouble pushing volatility lower so they are keying in on chips to stop the market selloff. So it is likely a game of bulls win and a rally begins with SOX 3783 (now at 3770), or, bears begin a massacre with NYA losing 16678. Which will it be?

1/16/22; 7:00 PM EST =
1/14/22; 10:00 AM EST =
1/10/22; 9:36 AM EST = +26; signal line is +75; go short 4630; (Benchmark SPX for 2022 = -2.9%)(Keybot algo this trade = -2.9%; Keybot algo for 2022 = -2.9%)(Actual results this trade = -1.6%; Actual results for 2022 = -1.6%)
1/10/22; 8:35 AM EST = +74; signal line is +76 but algorithm remains long
1/9/22; 7:00 PM EST = +88; signal line is +75
1/7/22; 2:43 PM EST = +88; signal line is +73
1/7/22; 2:38 PM EST = +74; signal line is +70
1/7/22; 2:30 PM EST = +58; signal line is +68 but algorithm remains long
1/7/22; 2:28 PM EST = +74; signal line is +67
1/7/22; 1:16 PM EST = +88; signal line is +63
1/7/22; 11:31 AM EST = +74; signal line is +61
1/7/22; 11:10 AM EST = +58; signal line is +60 but algorithm remains long
1/7/22; 10:32 AM EST = +74; signal line is +59
1/7/22; 10:09 AM EST = +58; signal line is +57
1/7/22; 10:03 AM EST = +72; signal line is +57
1/7/22; 9:59 AM EST = +88; signal line is +56
1/7/22; 9:51 AM EST = +74; signal line is +54
1/7/22; 9:00 AM EST = +58; signal line is +53
1/6/22; 9:36 AM EST = +58; signal line is +52
1/5/22; 3:51 PM EST = +74; signal line is +51
1/5/22; 3:43 PM EST = +88; signal line is +50
1/5/22; 3:35 PM EST = +74; signal line is +48
1/3/22; 11:35 AM EST = +88; signal line is +46
1/3/22; 9:36 AM EST = +72; signal line is +44
1/1/22; Algorithm Zeroed for 2022 Data = +88; signal line is +41; go long 4766; (Benchmark SPX for 2022 Final = +0.0%)(Keybot algo this trade = +0.0%; Keybot algo for 2022 = +0.0%)(Actual results this trade = +0.0%; Actual results for 2022 = +0.0%)

SPX S&P 500 Daily Chart Displaying Keybot the Quant Algorithm Turns in 2021

The S&P500 chart shows the Keybot the Quant algorithm's 31 turns in 2021. A lot of money was made in the April rally. Ditto October into November and over the last 2 weeks.

The benchmark SPX gains a huge +27% in 2021 the Federal Reserve's money-printing keeps pumping stocks higher making the wealthy filthy rich beyond their wildest expectations; and the gains are effortless. Wayne sings, "Danke schoen." One-half of Americans do not own a single share of stock.

The Keybot the Quant computer program gains +32% and triggers the actual trading of buying and selling of ETF's that gains a humongous +59% in 2021. Easy-peasy.

Keybot has never had a down year since the quant went live in late 2008 in the middle of the stock market collapse. Will the streak continue in 2022?

Keybot the Quant Algorithm Returns +59% in 2021; Another Stellar Year as the COVID-19 Pandemic Lingers

The Keybot the Quant algorithm is re-zeroed for the new year ahead. 2021 is another stellar year with the actual trading generated by the quant returning +59%. The quant program gains +32.3% as compared to the S&P 500 benchmark index at 26.9%. In a nutshell, the S&P 500, which is the United States stock market, SPX, gains a historic and record-setting 27% in 2021. The Keybot the Quant computer program gains +32% and controls the actual trading of the ETF's which gains a humongous +59% this year.

If you had $10,000 at the start of 2021, you have $16,000 only 12 months later. $100K one year ago got you $60K for a total of $160K only 12 months later.

The algorithm triggers a whipsaw on 12/17/21 so the trades will remain in the single ETF's for at least 30 days. The markets have become too choppy so the quant drops from the 2x ETF's to the 1x ETF's to reduce risk. A choppy market eats up bulls and bears alike. Everyone becomes part of the chop suey. The robot remains in SPY currently; the numbers were rezeroed to properly tally the yearly data.

The Fed's money-printing is as constant as snowflakes in wintertime carrying the crony capitalism system to its final resting place. In the meantime, everyday is a party since March 2009 when the United States decided to protect the wealthy and screw the poor. Making money is effortless; if you have money.

The bulls are in full control of the stock market as 2022 begins. The banks, volatility, commodities, copper, retail stocks and the NYA Index, are all bullish and controlling market direction and that is a lot of moving parts uncharacteristic of the normal action where only a couple parameters are steering the ship.

If you want to focus on one key parameter, it is the banks. XLF 38.77 is the line in the sand (now at 39.05). If the stock market weakens, XLF 38.77 will tell you if it is real, or not. If stocks sell off and everyone is scared but XLF does not drop below 38.77, stocks will likely recover. If XLF 38.77 fails, bears plan on exploring lower numbers for stocks.

Bears also need higher volatility and VIX 19.24 is the bull/bear line in the sand. VIX is at 17.22 to begin the year in bull territory (remember, volatility moves inverse to the stock market over 90% of the time). If stocks sell off and the VIX shoots above 19.24, the selling is real and has legs. If stocks sell off but the VIX does not move above 19.24, the bears got nothing and stocks will recover and move higher again.

Bears need GTX below 2718 (now at 2775; the commodity index), CPER below 26.60 (now at 27.21), RTH below 190.01 (now at 194.70) and NYA Index below 16618 (now at 17164). Lots of moving parts.

For the next week or more, you can forecast the stock market direction using these parameters; XLF 38.77, VIX 19.24, GTX 2718, CPER 26.60, RTH 190.01 and NYA 16618. Each one that turns bearish creates another down leg in stocks. You will know a short-term bottom is in play if any of the parameters turn bearish, but then revert back to bullish, that hints that the downside does not have much legs. If 3 of the 6 turn bearish, especially if it occurs in quick order within minutes or a few hours of each other, that means serious downside action has started and there is likely an ugly selloff already underway and gaining bigtime momentum.

The algo is in the 1x long ETF SPY currently and remains in the single ETF's until after 1/18/22 when the robot will revert back to 2x ETF's (unless another whipsaw occurs). Watch the banks and XLF 38.77.

1/9/22; 7:00 PM EST =
1/7/22; 9:00 AM EST =
1/1/22; Algorithm Zeroed for 2022 Data = +88; signal line is +41; hold long 4766; (Benchmark SPX for 2022 Final = +0.0%)(Keybot algo this trade = +0.0%; Keybot algo for 2022 = +0.0%)(Actual results this trade = +0.0%; Actual results for 2022 = +0.0%)

Keybot the Quant Begins 2022 on the Long Side from SPX 4766

All Data 0%. Begin 2022

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START 2022 PROGRAM

Begin Printing

Mark and Set

Date Stamp 1/1/22; 6:11 AM EST

START 2022 PROGRAM

Copyright Enforced. 2008. 2009. 2010. 2011. 2012. 2013. 2014. 2015. 2016. 2017. 2018. 2019. 2020. 2021. 2022. Keybot the Quant. The Keystone Speculator. K E Stone. All Rights Reserved.

 

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END OF 2021 RESULTS:

 

The SPX (S&P 500) Benchmark Index Gains a Huge +26.9% in 2021

(SPX Started at 3756 and Ended at 4766 Rallying an Unbelievable 1,010 Points During the Coronavirus (COVID-19) Pandemic)

 

Keybot the Quant Algorithm (Computer Program Only) During 2021: +32.3%

 

KEYBOT THE QUANT ACTUAL TRADING RETURN FOR 2021 INCLUDING ALL COMMISSIONS, COSTS AND FEES: +58.6%

 

Keybot the Quant has never printed a losing year

 

Keybot the Quant is a long-short algorithm that oscillates between a bullish (long) position and a bearish (short) position seeking the smoothest path through the trading year using the S&P 500 (SPX; the US stock market) as the benchmark comparison index

 

Number of Position Changes (Long to Short or Short to Long) During 2021: 31

 

1/1/2021	3756	Go Short	5:19 AM	SDS	12.39
1/6/2021	3745	Cover Short	10:10 AM	SDS	12.46
1/6/2021	3745	Go Long	10:10 AM	SSO	90.84
1/25/2021	3812	Sell Long	11:07 AM	SSO	94.22
1/25/2021	3812	Go Short	11:07 AM	SDS	11.96
2/1/2021	3779	Cover Short	2:18 PM	SDS	12.12
2/1/2021	3779	Go Long	2:18 PM	SSO	92.45
2/23/2021	3849	Sell Long	9:30 AM	SSO	96.07
2/23/2021	3849	Go Short	9:30 AM	SDS	11.62
3/9/2021	3882	Cover Short	10:03 AM	SDS	11.33
3/9/2021	3882	Go Long	10:03 AM	SSO	97.51
5/4/2021	4133	Sell Long	11:18 AM	SSO	110.35
5/4/2021	4133	Go Short	11:18 AM	SDS	9.90
5/14/2021	4144	Cover Short	9:30 AM	SDS	9.82
5/14/2021	4144	Go Long	9:30 AM	SSO	110.74
5/18/2021	4132	Sell Long	3:59 PM	SSO	110.29
5/18/2021	4132	Go Short	3:59 PM	QID	25.19
5/20/2021	4144	Cover Short	10:34 AM	QID	24.41
5/20/2021	4144	Go Long	10:34 AM	SPY	413.42
6/16/2021	4237	Sell Long	12:28 PM	SPY	423.47
6/16/2021	4237	Go Short	12:28 PM	SH	15.63
6/21/2021	4201	Cover Short	10:08 AM	SH	15.76
6/21/2021	4201	Go Long	10:08 AM	SSO	114.11
7/8/2021	4321	Sell Long	9:30 AM	SSO	119.78
7/8/2021	4321	Go Short	9:30 AM	SDS	9.01
7/9/2021	4345	Cover Short	9:43 AM	SDS	8.84
7/9/2021	4345	Go Long	9:43 AM	SPY	433.00
7/15/2021	4349	Sell Long	1:32 PM	SPY	433.62
7/15/2021	4349	Go Short	1:32 PM	SH	15.19
7/21/2021	4344	Cover Short	9:36 AM	SH	15.20
7/21/2021	4344	Go Long	9:36 AM	SPY	432.98
7/27/2021	4395	Sell Long	10:17 AM	SPY	438.42
7/27/2021	4395	Go Short	10:17 AM	SH	15.00
8/5/2021	4419	Cover Short	10:01 AM	SH	14.93
8/5/2021	4419	Go Long	10:01 AM	SPY	440.68
8/16/2021	4454	Sell Long	9:30 AM	SPY	444.46
8/16/2021	4454	Go Short	9:30 AM	SDS	8.35
8/23/2021	4482	Cover Short	11:05 AM	SDS	8.25
8/23/2021	4482	Go Long	11:05 AM	SSO	129.84
9/7/2021	4514	Sell Long	10:13 AM	SSO	131.83
9/7/2021	4514	Go Short	10:13 AM	QID	17.76
9/23/2021	4420	Cover Short	9:36 AM	QID	18.67
9/23/2021	4420	Go Long	9:36 AM	SSO	126.27
9/28/2021	4385	Sell Long	10:07 AM	SSO	124.24
9/28/2021	4385	Go Short	10:07 AM	SDS	8.55
10/13/2021	4359	Cover Short	1:29 PM	SDS	8.61
10/13/2021	4359	Go Long	1:29 PM	QLD	73.35
11/9/2021	4689	Sell Long	9:56 AM	QLD	88.38
11/9/2021	4689	Go Short	9:56 AM	SDS	7.42
11/12/2021	4669	Cover Short	11:02 AM	SDS	7.47
11/12/2021	4669	Go Long	11:02AM	QLD	87.56
11/22/2021	4690	Sell Long	3:57 PM	QLD	90.54
11/22/2021	4690	Go Short	3:57 PM	QID	15.81
12/7/2021	4666	Cover Short	9:48 AM	QID	16.13
12/7/2021	4666	Go Long	9:48 AM	SSO	140.46
12/9/2021	4693	Sell Long	9:36 AM	SSO	142.20
12/9/2021	4693	Go Short	9:36 AM	SDS	7.41
12/15/2021	4647	Cover Short	2:13PM	SDS	7.45
12/15/2021	4647	Go Long	2:13 PM	SSO	139.70
12/17/2021	4618	Sell Long	9:42 AM	SSO	137.59
12/17/2021	4618	Go Short	9:42 AM	SH	14.09
12/21/2021	4605	Cover Short	9:36 AM	SH	14.11
12/21/2021	4605	Go Long	9:36 AM	SPY	458.78
1/1/2022	4766	Hold Long	6:11 AM	SPY	474.96

 

Date – SPX – Position – Date Stamp – ETF – Price

 

Begin Printing Trade Data Entries Exits Reverse Order

 

FINAL 2021 RESULTS

 

Mark and Set

 

Date Stamp 1/1/22; 6:11 AM EST

 

End – End – End – End – End – End – End – End – End – End – End

 

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1/1/22; Algorithm Zeroed for 2022 Data = +88; signal line is +41; hold long 4766; (Benchmark SPX for 2021 Final = +26.9%)(Keybot algo this trade = +3.5%; Keybot algo for 2021 Final = +32.3%)(Actual results this trade = +3.5%; Actual results for 2021 Final = +58.6%)
12/28/21; 10:00 AM EST = +88; signal line is +39