Keybot the Quant remains short as the bulls stage a comeback rally. NYA recovers higher. Despite the upside euphoria, the only market parameter joining the bull camp is utilities, and that is tentative.
The bears remain in charge but the gap between the algo number and signal line shortens to 20 points. The previous post explains the utility drama. For next week, UTIL 961.35 and 960.60 are two key bull/bear lines in the sand. UTIL nudges higher yesterday to 963 to set themselves up for a happy week next week with the Fed on tap.
The importance of the UTIL 960-962 line in the sand cannot be overstated. It has a huge impact on stock market direction going forward. At the closing bell today, check to see where UTIL finishes since above 962 paints a happy picture for stocks next week but below 960 paints a troubling path forward for the US stock market.
Bulls obviously need to keep UTIL above 962 and moving higher to prove that they got game. In addition, bulls need stronger chips and banks, SOX above 3022 and XLF above 33.13, respectively, so watch these 2 parameters closely since they will likely indicate if the algo wants to flip long. If one of the 2 turn bullish, consider the caution flag to be out and if both turn bullish, consider the imminent turn to the long side to be in play for the quant.
Utes, socks and banks will tell the story going into the Fed circus next week. Stocks are usually higher the day or two in front of the Fed meeting (Tuesday and Wednesday) and then markets will probably whipsaw and chop once Pope Powell decrees how traders should trade on hump day afternoon.
Keybot prints a pre-scheduled number shortly after the opening bell. Today is the last trading day of April (EOM). May trading begins on Monday the fifth month of the year already.
4/30/23;
7:00 PM EST EOM =
4/28/23;
10:00 AM EST =
4/27/23;
3:50 PM EST = -5; signal line is +15
4/27/23;
3:38 PM EST = -21; signal line is +17
4/27/23;
3:03 PM EST = -5; signal line is +19
4/26/23;
11:57 AM EST = -21; signal line is +21
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