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

Keybot the Quant flips to the short side at SPX 3760 out of the gate yesterday as described in the previous post. The whipsaw action continues. Commodities are collapsing with the rising dollar due to the weakening euro and pound (Europe's economy is falling apart). Utilities and volatility are controlling the US stock market direction today. The bears are in charge with the algo number 13 points below the signal line that is not a glowing endorsement of the downside as yet.

Watch UTIL 954.90, the trap-door for stocks, and VIX 26.95 the other bull/bear line in the sand. The trap-door opened briefly yesterday but the bulls closed it again. You know the drill. If UTIL 954.90 fails, there will be Hell to pay. UTIL is trading at 963.35 this second (bullish) and dipped to the 959 palindrome a few minutes ago. Watch it closely since it tells you if the bulls can survive, or not. It's All Over Now, Baby Blue, if UTIL fails at 954-955 and the trap-door opens for stocks. If UTIL remains above 954, it tells you that the downside does not have much oomph and the bulls will reexert themselves.

Bulls need VIX below 26.95 or they got absolutely nothing. Stocks will not rally unless VIX moves below 26.95. Period. If a rally occurs but VIX remains above 26.95, the rally will fade and give way to lower numbers ahead. If a rally occurs and VIX drops below 26.95, it is off to the races and if the SPX is above 3849 trending higher, Keybot the Quant will likely flip long, hence the imminent turn notation in the title line.

On the last trade, a whipsaw from late Friday before the holiday, the algo program and actual trading both lose -1.6%. For the year, the S&P 500 is down -21%, the robot's program is up +14% and the actual trading triggered by the quant is up +12% (outperforming the benchmark US stock market by 33 percentage-points). The quant will remain in the 1x ETF's for another 30 days due to another whipsaw. The erratic price moves are chop suey chopping up bulls and bears alike. Keybot the Quant exits SH and enters DIA. 

SPX is at 3832. UTIL is at 964 but bears need 954. VIX is at 27.76 but bulls need 26.95. One of them will flinch and tell you the direction of the stock market ahead.

7/10/22; 7:00 PM EST =
7/8/22; 9:00 AM EST =
7/5/22; 3:08 PM EST = -52; signal line is -39
7/5/22; 12:21 PM EST = -68; signal line is -38
7/5/22; 12:00 PM EST = -52; signal line is -37
7/5/22; 11:00 AM EST = -68; signal line is -36
7/5/22; 9:36 AM EST = -52; signal line is -35; go short 3760; (Benchmark SPX for 2022 = -21.1%)(Keybot algo this trade = -1.6%; Keybot algo for 2022 = +14.2%)(Actual results this trade = -1.6%; Actual results for 2022 = +12.4%)
7/4/22; 3:45 AM EST = -36; signal line is -35 but algorithm remains long
7/3/22; 7:00 PM EST = -22; signal line is -36
7/1/22; 3:33 PM EST = -22; signal line is -37; go long 3822; (Benchmark SPX for 2022 = -19.8%)(Keybot algo this trade = +6.3%; Keybot algo for 2022 = +15.8%)(Actual results this trade = +6.0%; Actual results for 2022 = +14.0%)

Note Added 12:11 PM EST: The SPX is at 3815 down 17 points but UTIL is up at 961. Note that the bears were jumping up and down on the trap door at 11:01 AM EST with UTIL printing the LOD at 954.71, but the trap-door would not open. The battle continues. VIX remains elevated at 27.80. Perhaps the bulls will now try to push volatility lower with the help of the Fed.