STOCK MARKET BULLISH -- LONG -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant remains long, which is surprising, since the model is champing at the bit to go short with the algo number 23 points below the signal line. It is on a silver platter for bears.

There are a lot of moving parts right now that are too involved to explain in a post but perhaps some guidelines will help all of you follow along. The quant wants to flip short asap. After the opening bell tomorrow, watch the initial move of the S&P 500. If the SPX drifts lower by only 1 point and trends lower, Keybot the Quant will likely flip short, hence the imminent turn notation in the title line. Sounds easy for the bears, doesn't it? Well, not so fast.

The bears need a gentle steady move lower not a gap-down at the opening bell. If the SPX collapses at the open by 11 points or more, this behavior will likely delay the flip to the short side by about 90 minutes. If bearish, you do not want a -11 point drop or more in SPX at the opening bell and S&P futures on Sunday evening on the East Coast are down ..... wait for it ..... wait for it .... -10 points. The bears may ruin it for themselves.

Let's call Monday a battle of utes and retail (both creating bearishness) against banks and the NYA index (both creating bullishness). Here is another twist possible for tomorrow morning. If XLF drops below 34.43 (only pennies away), or if NYA drops below 15206, either would do, the quant will likely immediately flip short regardless of other factors. This may also occur if VIX spikes above 24.80.

The bulls need to keep the banks and NYA in their camp and at the same time pull UTIL above 975.20 and/or RTH above 165.50. Either one will stop the stock market selling in its tracks. If both flip bullish, stocks are going to run strongly higher.

Is all that clear as mud? And that is a simplified version of what is happening. The stock market is erratic and unstable ahead of the inflation report on Tuesday morning and King Powell's rate decision and press conference Wednesday afternoon. Keybot does not print any pre-scheduled numbers this week.

Bears are ready to flip the model short but do not want a gap-down tomorrow morning. Bears will benefit greatly if banks are weak and or if the NYA index is weak. Bulls need to maintain banks and the NYA heading higher while pulling the utes and retail stocks higher.

12/18/22; 7:00 PM EST =
12/11/22; 7:00 PM EST = +9; signal line is +32 but algorithm remains long
12/9/22; 3:29 PM EST = +9; signal line is +32 but algorithm remains long
12/9/22; 3:01 PM EST = +25; signal line is +33 but algorithm remains long
12/9/22; 2:38 PM EST = +41; signal line is +32
12/9/22; 2:10 PM EST = +25; signal line is +32 but algorithm remains long
12/9/22; 10:00 AM EST = +41; signal line is +32
12/8/22; 3:18 PM EST = +41; signal line is +31
12/8/22; 3:11 PM EST = +25; signal line is +30 but algorithm remains long
12/8/22; 12:06 PM EST = +41; signal line is +29
12/8/22; 11:21 AM EST = +25; signal line is +28 but algorithm remains long
12/8/22; 10:29 AM EST = +41; signal line is +27
12/7/22; 2:51 PM EST = +25; signal line is +26 but algorithm remains long
12/7/22; 2:39 PM EST = +41; signal line is +26
12/7/22; 2:01 PM EST = +25; signal line is +25 but algorithm remains long
12/6/22; 2:45 PM EST = +41; signal line is +25
12/6/22; 2:35 PM EST = +25; signal line is +24
12/6/22; 2:21 PM EST = +41; signal line is +24
12/5/22; 9:36 AM EST = +25; signal line is +24
12/4/22; 7:00 PM EST = +25; signal line is +24