STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short during this period of odd price action. The bears are in charge with the algo number 13 points below the signal line but the bulls do not notice because they are too busy buying stocks. The quant takes the pipe out of the gate this morning--and the SPX rallies 55 points. Huh? Weird stuff.

Wizard Warsh will bring the tablets down from On High tomorrow morning, after visiting the monks at the peaks of the Wyoming mountains, and tell traders and investors how to trade. The world's central bankers are in Jackson Hole discussing new ways to print money. It will be interesting if Warsh does the traditional slow walk for the cameras with two colleagues. The chairman typically walks out to the fence, and then points into the distance as if they are discussing something about nature, and then turn around and walk back. Warsh is on stage at 10 AM EST one-half hour after the cash open and that would be 8 AM first thing in the morning out at Jackson Hole with 2 hours time difference. Warsh will probably have a jelly stain on his necktie from the free buffet. The Warsh drama will be front and center but probably end up as a nothing burger.

The utilities failed over the last few days and you should be very afraid since that places a crash scenario for the stock market on the table in the days and weeks ahead. Utes leading the broad stock market lower is a very bad thing. It was a huge surprise today that UTIL, or DJU, collapsed to 1086 sinking further into the bear ooze. The UTIL 1093 line in the sand this week is worthless after tomorrow and replaced with 1132.36 a far harder, and higher, goal for the bulls to meet for all of next week. For tomorrow, the 1093 is still in play but watch to see where UTIL closes for the week. For next week, UTIL 1125 and 1132 will be the two lines in the sand. Bulls cannot make new highs in the stock market unless both of these ute parameters turn positive next week and price now sits at 1086.

Chips and retail stocks are weak with SOX below 12065 and XRT below 87.97 that should create stock market negativity. Watch these two metrics closely tomorrow. Bears need higher volatility, and VIX above 17 but it now has a 14 handle. Bears also need weaker copper, commodities and banks.

Simply watch UTIL 1093, SOX 12065 and XRT 87.97 tomorrow. All three are in the bear camp creating stock market negativity although it does not appear that way with everyone buying stocks. If any 1 of the 3 turn bullish, consider the imminent turn to the long side to be in play and if the SPX then bumps above 7741 trending higher, Keybot the Quant will likely flip long.

If the bears can keep all 3 metrics bearish tomorrow, that would be a win for the negative side. Especially utilities. If UTIL continues lower, gird your loins, because that means a Bad Moon's Rising.

Keybot the Quant prints a prescheduled number tomorrow shortly after the opening bell. Utes, chips and retail stocks are all that matter.

8/31/26; 7:00 PM EST EOM =
8/30/26; 7:00 PM EST =
8/28/26; 10:00 AM EST =
8/27/26; 9:36 AM EST = +4; signal line is +17
8/26/26; 9:39 AM EST = +36; signal line is +18 but algorithm remains short
8/26/26; 9:38 AM EST = +20; signal line is +18 but algorithm remains short
8/25/26; 3:56 PM EST = +4; signal line is +18
8/25/26; 2:42 PM EST = +20; signal line is +19 but algorithm remains short
8/25/26; 2:26 PM EST = +4; signal line is +20
8/25/26; 2:14 PM EST = +20; signal line is +21
8/25/26; 10:00 AM EST = +4; signal line is +21
8/25/26; 9:39 AM EST = +4; signal line is +22
8/24/26; 9:36 AM EST = +20; signal line is +23
8/23/26; 7:00 PM EST = +4; signal line is +23