STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant is long and coming to life this week printing another number a couple hours ago.  Note the roll over in the utilities sector and this is dragging the markets down.  The market bulls got nothing unless they can move UTIL above 452.91 and now it sits a point under.  Copper, JJC, however, continues to hold up well, thus, the weaker dollar keeps JJC and CRB elevated and thus prevents the markets from making any headway to the downside.

The algo number is now only three points away from the signal line so Keybot is coming close to switching to the short side.  Most sectors, however, remain elevated and supportive of the bulls. The market bears need to see a stronger dollar that will slap copper and commodities lower and cause the broad markets to roll over.  Otherwise, the quant idles along on the long side for now. Caution is warranted.

2/26/12; 7:00 PM EST =

2/24/12; 10:00 AM EST =

2/21/12; 1:18 PM EST = +60; signal line is +57

2/21/12; 10:42 AM EST = +76; signal line is +57

2/21/12; 9:48 AM EST = +60; signal line is +55

2/19/12; 7:00 PM EST = +76; signal line is +55

2/16/12; 1:10 PM EST = +76; signal line is +54; go long 1356; (Benchmark SPX for 2012  = +7.8%)(Keybot this trade = -1.0%; Keybot for 2012 = +5.7%)(Actual this trade = -2.0%; Actual for 2012 = +8.2%)

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant is long to start the new week of trading and active printing out two numbers for the week thus far.  The utilities sector is dancing above and below the critical 492.91 level for this week.  In a nutshell, if you are bullish, you want UTIL to get above 452.91 and stay there all week, this will provide broad market buoyancy.

If you are bearish, you want UTIL to stay under 452.91 all week long and in addition, JJC to drop under 46.90 (remember the algo is constantly calculating these numbers so they change slightly as time moves along). This action would get the bear party started.  The SPX moved up thru the 2011 closing high at 1363.61 and is now at 1366, so a test at 2011's intraday high at 1370-1371 may be on tap.

Note that the algo was actually within five points of the signal line minutes ago. Keybot is on the bull side currently but the relationship is tenuous. UTIL and JJC are key.

2/26/12; 7:00 PM EST =

2/24/12; 10:00 AM EST =

2/21/12; 10:42 AM EST = +76; signal line is +57

2/21/12; 9:48 AM EST = +60; signal line is +55

2/19/12; 7:00 PM EST = +76; signal line is +55

2/16/12; 1:10 PM EST = +76; signal line is +54; go long 1356; (Benchmark SPX for 2012  = +7.8%)(Keybot this trade = -1.0%; Keybot for 2012 = +5.7%)(Actual this trade = -2.0%; Actual for 2012 = +8.2%)

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant begins the new week on Tuesday morning on the long side. The China easing news and Greece developments should boost commodities, emerging markets and equities markets higher but the US.open remains a day away, and a lot can happen over the next day.  Watch the utilities, UTIL, 452.91. The market bulls need to push above this number to sustain market upside.  Likewise, copper is important, especially in the light of the China easing. Watch JJC 47.60; the bulls need to remain above and the market bears will try to push under this level. The China triple R easing was anticipated for a month or more so it will be interesting to see how much of it was priced into markets, or not.

For the SPX, starting at 1361, the market bulls need to push thru the closing high from 2011 at 1363.61 and that would set off a firestorm of upside buying with the SPX heading higher to potentially test the 1370-1371 area, which is the intraday HOD from 2011. The market bears need to push the SPX under 1357 and the selling will noticeably increase. A move thru 1358-1362 is sideways action.

Markets remain highly unstable. If UTIL stays under 452.91 and JJC weakens, Keybot will likely flip to the short side. There is only one pre-scheduled number this week that prints on Friday morning. For now, Keybot idles along on the long side.

2/26/12; 7:00 PM EST =

2/24/12; 10:00 AM EST =

2/19/12; 7:00 PM EST = +76; signal line is +55

2/16/12; 1:10 PM EST = +76; signal line is +54; go long 1356; (Benchmark SPX for 2012  = +7.8%)(Keybot this trade = -1.0%; Keybot for 2012 = +5.7%)(Actual this trade = -2.0%; Actual for 2012 = +8.2%)

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant is on the long side as the holiday weekend begins in the States. U.S. markets are closed on Monday with trading resuming at 9:30 AM EST on Tuesday, 2/21/12. Keybot finished the week without printing any further numbers after whipsawing back to the long side at 1 PM last Thursday. This calmness does not display the internal workings of the algorithm that are actually quite dramatic.

When trading begins on Tuesday, the utilities and copper sectors are key. Weakness in these two sectors should usher in significant broad market weakness.  The outcome of the Greece meetings this weekend and projected resolution by Monday plays a key role. The UTIL 452.91 and JJC 47.60 levels require close watching as the Tuesday bell rings. These levels as well as others can be set up after tomorrow's pre-scheduled Sunday number prints. The algo will be long to start the new week but that may change quickly depending on the developing news over the next three days.

The SPX filled the 1360 gap left behind from May 2011 but fell short of achieving a close above the 2011 closing high at 1363.61; the 1364 R held. Pay attention to 1363.61 since bells, whistles and fireworks will sound if it is touched.

2/19/12; 7:00 PM EST =

2/16/12; 1:10 PM EST = +76; signal line is +54; go long 1356; (Benchmark SPX for 2012  = +7.8%)(Keybot this trade = -1.0%; Keybot for 2012 = +5.7%)(Actual this trade = -2.0%; Actual for 2012 = +8.2%)

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant ends the day on the long side moving from a couple weeks of pure calmness to two turns in two days time, now back in the bull camp after the SPX triggered the 1356 level today. It would be no surprise to see the algorithm flip back to the short side tomorrow or Tuesday (U.S. stock markets are closed on Monday).

For Friday, watch UTIL 451.17, now at 452.62, tumbling into the close today. The broad indexes will weaken if UTIL falls back under the 451.17. At the 4 PM close, watch to see where UTIL finishes in reference to 452.91 since this is the number that will separate market bulls and bears for next week. Note that the current level for UTIL at 452.62 actually favors the market bears for next week (under 452.91).  Watch JJC tomorrow to see if the bulls can keep it above 47.90, likewise CRB 311.40.

For the SPX, starting at 1358, the market bulls only need one measley point, to push above 1359, and the markets will accelerate upwards, filling the 1360 gap and moving onwards to 1361 R, then 1364 R (which represents the 4/29/11 closing high), then 1365 R.  Thus, if the futures are green overnight, Friday will be a bull party into the long weekend.  The market bears will try to keep the futures red to stop the upward momo. Bears need to retrace today's move to reestablish strong negativity, a formidable task. A move thru 1343-1358 is sideways action. UTIL 451.17 should play a key role again.  Stay on guard, markets are highly unstable and erratic and can easily roll over at any time. For now, Keybot remains long.

2/19/12; 7:00 PM EST =

2/16/12; 1:10 PM EST = +76; signal line is +54; go long 1356; (Benchmark SPX for 2012  = +7.8%)(Keybot this trade = -1.0%; Keybot for 2012 = +5.7%)(Actual this trade = -2.0%; Actual for 2012 = +8.2%)

SPX Daily Chart Showing Keybot the Quant Algorithm Turns -- Bullish from 2/16/12

2/16/12: Keybot the Quant flipped to the long side at 1:10 PM at SPX 1356; for the year thus far SPX Benchmark is up 7.8%; Keybot algo is up 5.7%; Keybot actual trading is up 8.2%. Stay on guard for a whipsaw.2/14/12: Keybot the Quant flipped to the short side at 2:30 PM at SPX 1342; for the year thus far SPX Benchmark is up 6.7%; Keybot algo is up 6.7%; Keybot actual trading is up 10.2%. Stay on guard for a whipsaw.
1/1/12: The new year begins. For 2011, the SPX Benchmark is flat finishing up 0%; Keybot algo finished the year up 33%; Keybot actual trading ended the year up 37%. Keybot begins 2012 remaining long. The new year begins at SPX 1258.
12/20/11: Keybot the Quant flipped to the long side at 2:49 PM at SPX 1240; for the year thus far SPX Benchmark is down 1.4%; Keybot algo is up 31.2%; Keybot actual trading is up 35.5%. Stay on guard for a whipsaw.
12/12/11: Keybot the Quant flipped to the short side at 10:25 AM at SPX 1234; for the year thus far SPX Benchmark is down 1.9%; Keybot algo is up 31.7%; Keybot actual trading is up 37.0%. Stay on guard for a whipsaw today or tomorrow.
11/28/11: Keybot the Quant flipped to the long side at 9:52 AM at SPX 1194; for the year thus far SPX Benchmark is down 5.1%; Keybot algo is up 28.3%; Keybot actual trading is up 32.3%. Stay on guard for a whipsaw today or tomorrow.

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant flips back to the long side. The market bulls pushed hard with utilities today and that was the tell.  The VIX could not move above its 50-day MA, SPX:VIX ratio popped back above 68 and the SPX took out yesterday's highs.  So a whipsaw does occur with Keybot turning bullish within 48 hours of where the algo went short.  The algo program lost a percent due to the stutter step and the actual trading lost 2%.  The quant dropped down into a lower risk mode now and is trading with non-leveraged ETF's now for the next 45 days.

Keybot is long again but stay on guard since a whipsaw back to the short side may occur at anytime. The key item to watch is utilities since they provided the bull push today. The UTIL 451.17 number is important thru tomorrow and this number will ratchet up higher for next week.

Looks like 2012 is kicked off ofifcially now and running strong. The AAPL and tech strength story, and now the utes strength, is too much for market bears to overcome, but, the markets are simply one news event away from turmoil.  The caution flag remains out, these markets can flip flop again at any time.

2/19/12; 7:00 PM EST =

2/16/12; 1:10 PM EST = +76; signal line is +54; go long 1356; (Benchmark SPX for 2012  = +7.8%)(Keybot this trade = -1.0%; Keybot for 2012 = +5.7%)(Actual this trade = -2.0%; Actual for 2012 = +8.2%)

2/16/12; 10:15 AM = +76; signal line is +52 but algorithm says stay short

2/16/12; 9:00 AM = +60; signal line is +50 but algorithm says stay short

2/14/12; 2:30 PM EST = +48; signal line is +49; go short 1342; (Benchmark SPX for 2012  = +6.7%)(Keybot this trade = +6.7%; Keybot for 2012 = +6.7%)(Actual this trade = +10.2%; Actual for 2012 = +10.2%)

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short but the utilities explode higher today on happy earnings numbers. Keybot finally becomes active intraday again and prints a number a short time ago.  The algorithm wants to go back to the long side now, clearly evident by the +76 algo number far above the singnal line, but, other programming rules are holding the algo back.

Continue watching UTIL 451.17, see if the bulls can hold that level or higher today, or not.  Also watch JJC 47.80. The SPX punched thru 1347 R and is now attempting 1349 R. If the SPX touches 1356, Keybot will likely flip back to the long side.  If the SPX does not move above 1356 today, Keybot will likely remain short.

2/19/12; 7:00 PM EST =

2/16/12; 10:15 AM = +76; signal line is +52 but algorithm says stay short

2/16/12; 9:00 AM = +60; signal line is +50 but algorithm says stay short

2/14/12; 2:30 PM EST = +48; signal line is +49; go short 1342; (Benchmark SPX for 2012  = +6.7%)(Keybot this trade = +6.7%; Keybot for 2012 = +6.7%)(Actual this trade = +10.2%; Actual for 2012 = +10.2%)

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short but the pre-scheduled number printed over the last few minutes is surprising.  Note that the algo number jumped 12 points to +60 and Keybot wants to return to the long side, ten points above the signal line.  At least for today, however, the market bears will likely maintain control since other algo rules are holding Keybot back from swiching to the long side.  One key element is that the SPX will probably have to tag 1356 today for Keybot to flip long. In these markets, perhaps anything is possible.

The way the market bears can maintain contol is to slap either JJC or CRB under 48 or 311.40, respectively. Either of these will serve to place the algo back in more firm bear control.  Another exciting day is on tap. We will see if Keybot prints any numbers today, or not. The caution flag remains out, the broad indexes are in a tug-o-war. Reference the previous message for specific market levels to watch which dictate broad market direction.

2/19/12; 7:00 PM EST =

2/16/12; 9:00 AM = +60; signal line is +50 but algorithm says stay short

2/14/12; 2:30 PM EST = +48; signal line is +49; go short 1342; (Benchmark SPX for 2012  = +6.7%)(Keybot this trade = +6.7%; Keybot for 2012 = +6.7%)(Actual this trade = +10.2%; Actual for 2012 = +10.2%)

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short.  That is odd to say considering for the last two months each missive began with another day of Keybot remaining long.  The algo did not print any numbers today. A whipsaw did not occur which was surprising considering all the bullishness with the futures and the happy start to the session. Problems were apparent from the start for the bulls, however, with the utilities weak, volatility moving up, the SPX:VIX dropping under 68 and other indicators.  AAPL provided the buoyancy to hold the markets in check, but then once Apple rolled over, the broad markets crumbled lower.

The aglorithm came within seconds of moving back to the long side at noon time today as the SPX printed highs at 1355 and change.  Price has to maintain a level set by the algo for a set amount of minutes and Keybot came within seconds of a whipsaw before the SPX price collapsed and then fell all afternoon into the close. Truly remarkable to witness the behavior of Keybot. The robot's are smarter than the human's.

The market bulls must move UTIL, the utilities sector, above 451.17 to move the markets higher. As long as the market bears keep UTIL under 451.17, the bulls have hit a ceiling in the markets. The bears need to push either the CRB lower, thru 311.40 (now at 314.95), or the JJC lower, thru 48 (now at 48.99). A higher dollar will push the CRB and JJC lower. Watch the JJC closely since a loss of the 48 level will open up extended downside and bearish action.

For the SPX for Thursday, starting at 1343, the bears finally have some wind at their backs.  All the bears need is two and one-half points lower, to push under 1340.80, to accelerate the broad markets lower. Bulls are on their heels now so they are simply trying to stop the drop by keeping copper buoyant and the SPX above 1341.  A move thru 1342-1354 is sideways action. SPX 1337 is strong support.

A pre-scheduled number prints at 9 AM but it should not have an impact on Keybot.  Markets remain unstable, stay cautious. For now, the bears are running.  If tomorrow goes by with the quant remaining short, the bears should have legs for a few days.

2/19/12; 7:00 PM EST =

2/16/12; 9:00 AM =

2/14/12; 2:30 PM EST = +48; signal line is +49; go short 1342; (Benchmark SPX for 2012  = +6.7%)(Keybot this trade = +6.7%; Keybot for 2012 = +6.7%)(Actual this trade = +10.2%; Actual for 2012 = +10.2%)

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant turns to the bear side today.  The new year is now officially kicked off with Keybot performing the first trade of the year, six weeks into the year. The late day drama pushed the SPX:VIX ratio back above 68 in the final minutes favoring market bulls again. Watch to see if the ratio loses 68 tomorrow which would signal a large down day on tap.

UTIL closed at 450.32, only 85 cents under the critical 451.17 that will firmly place the market bulls back in business again. Copper, JJC, closing at 49.18, requires close watching since it is very near the 48 level that Keybot is monitoring. JJC losing 48 is very bearish for markets.  CRB is at 313.95 comfortably above 311.30 which would usher in significant market bearishness. Volatility is drifting higher. The VIX is at 19.54 and needs 25 to favor the market bears.

For the SPX for Wednesday, starting at 1350.50, the bulls only need one measley point higher, to move up and over 1351.30 and the markets will be off and running to the upside again.  The market bears need to keep the futures red and to push the SPX back down to lose the 1341 level; this would accelerate the broad market selling.  A move thru 1342-1350 is sideways action.

If Keybot touches SPX 1355.42 tomorrow, the algo will probably whipsaw back to the long side. Markets are erratic, stay on guard, the caution flag remains out. Wednesday we find out if Keybot is whipsawed, or not.

2/19/12; 7:00 PM EST =

2/16/12; 9:00 AM =

2/14/12; 2:30 PM EST = +48; signal line is +49; go short 1342; (Benchmark SPX for 2012  = +6.7%)(Keybot this trade = +6.7%; Keybot for 2012 = +6.7%)(Actual this trade = +10.2%; Actual for 2012 = +10.2%)

2/12/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

Note Added 2/15/12 at 12:06 PM: Keybot now in the neighborhood where a whipsaw may occur, it's deciding now.

SPX Daily Chart Showing Keybot the Quant Algorithm Turns -- Bearish from 2/14/12

2/14/12: Keybot the Quant flipped to the short side at 2:30 PM at SPX 1342; for the year thus far SPX Benchmark is up 6.7%; Keybot algo is up 6.7%; Keybot actual trading is up 10.2%. Stay on guard for a whipsaw.
1/1/12: The new year begins. For 2011, the SPX Benchmark is flat finishing up 0%; Keybot algo finished the year up 33%; Keybot actual trading ended the year up 37%. Keybot begins 2012 remaining long. The new year begins at SPX 1258.
12/20/11: Keybot the Quant flipped to the long side at 2:49 PM at SPX 1240; for the year thus far SPX Benchmark is down 1.4%; Keybot algo is up 31.2%; Keybot actual trading is up 35.5%. Stay on guard for a whipsaw.
12/12/11: Keybot the Quant flipped to the short side at 10:25 AM at SPX 1234; for the year thus far SPX Benchmark is down 1.9%; Keybot algo is up 31.7%; Keybot actual trading is up 37.0%. Stay on guard for a whipsaw today or tomorrow.
11/28/11: Keybot the Quant flipped to the long side at 9:52 AM at SPX 1194; for the year thus far SPX Benchmark is down 5.1%; Keybot algo is up 28.3%; Keybot actual trading is up 32.3%. Stay on guard for a whipsaw today or tomorrow.

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant flips short at 2:30 PM EST today. The 8 week rally ends. Markets are highly unstable currently. The algorithm finally lined up to make a switch to the short side. Stay on guard for potential whipsaw today or tomorrow.

The year starts off on a high note. The Keybot program is up 7% on the year, same as the SPX Benchmark. Keybot's actual trading is up 10.2% so far this year, locking in the first profits for the year on the first trade of the year for the quant.  The algo was actually long from mid-December but a portion of the gain was placed in 2011 to keep the yearly records straight.  From SPX 1240 to 1342 is an 8% gain since December, so about 1.3% was credited to 2011 and 6.7% credited to 2012 to begin the new year. It is always nice to build up over 10% of insurance already and we are only six weeks into trading for 2012 thus far.

2/19/12; 7:00 PM EST =

2/16/12; 9:00 AM =

2/14/12; 2:30 PM EST = +48; signal line is +49; go short 1342; (Benchmark SPX for 2012  = +6.7%)(Keybot this trade = +6.7%; Keybot for 2012 = +6.7%)(Actual this trade = +10.2%; Actual for 2012 = +10.2%)

2/12/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/10/12; 10:00 AM EST = +48; signal line is +49 but algorithm says stay long

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

1/31/12; 7:00 PM EST EOM = +48; signal line is +48 but algorithm says stay long

1/31/12; 10:00 AM EST = +48; signal line is +48 but algorithm says stay long

1/30/12; 9:30 AM EST = +48; signal line is +48

1/29/12; 7:00 PM EST = +64; signal line is +47

1/27/12; 10:00 AM EST = +64; signal line is +45

1/23/12; 9:33 AM EST = +64; signal line is +43

1/23/12; 9:21 AM EST = +50; signal line is +41

1/23/12; 8:00 AM EST = +64; signal line is +40

1/22/12; 7:00 PM EST = +50; signal line is +38

1/20/12; 8:00 AM EST = +50; signal line is +36

1/19/12; 1:13 PM EST = +64; signal line is +35

1/19/12; 12:38 PM EST = +50; signal line is +34

1/19/12; 9:00 AM EST = +64; signal line is +32

1/19/12; 8:00 AM EST = +64; signal line is +31

1/18/12; 9:50 AM EST = +50; signal line is +29

1/18/12; 8:45 AM EST = +36; signal line is +26

1/18/12; 8:00 AM EST = +50; signal line is +25

1/17/12; 2:35 PM EST = +36; signal line is +23

1/17/12; 9:32 AM EST = +50; signal line is +23

1/15/12; 7:00 PM EST = +36; signal line is +22

1/13/12; 10:26 AM EST = +36; signal line is +22

1/13/12; 10:18 AM EST = +22; signal line is +21

1/13/12; 10:00 AM EST = +36; signal line is +21

1/12/12; 11:01 AM EST = +36; signal line is +21

1/11/12; 12:15 PM EST = +50; signal line is +20

1/11/12; 11:02 AM EST = +36; signal line is +20

1/11/12; 9:24 AM EST = +50; signal line is +19

1/11/12; 8:55 AM EST = +36; signal line is +17

1/10/12; 9:30 AM EST = +50; signal line is +15

1/10/12; 8:00 AM EST = +34; signal line is +14

1/9/12; 2:03 PM EST = +20; signal line is +12

1/9/12; 10:39 AM EST = +6; signal line is +12 but algorithm says stay long

1/9/12; 10:27 AM EST = +20; signal line is +12

1/8/12; 7:00 PM EST = +6; signal line is +11 but algorithm says stay long

1/6/12; 12:40 PM EST = +6; signal line is +10 but algorithm says stay long

1/6/12; 11:33 AM EST = +20; signal line is +10

1/6/12; 9:30 AM EST = +6; signal line is +8 but algorithm says stay long

1/6/12; 9:00 AM EST = +20; signal line is +7

1/5/12; 3:40 PM EST = +20; signal line is +6

1/5/12; 2:27 PM EST = +6; signal line is +5

1/5/12; 1:25 AM EST = +20; signal line is +3

1/4/12; 2:40 PM EST = +6; signal line is +1

1/4/12; 10:10 AM EST = -10; signal line is 0 but algorithm says stay long

1/4/12; 9:42 AM EST = +6; signal line is -2

1/4/12; 9:30 AM EST = -10; signal line is -3 but algorithm says stay long

1/3/12; 3:22 PM EST = +22; signal line is -4

1/3/12; 2:42 PM EST = +36; signal line is -6

1/3/12; 12:59 PM EST = +22; signal line is -8

1/3/12; 12:48 PM EST = +6; signal line is -10

1/3/12; 12:30 PM EST = +22; signal line is -11

1/3/12; 10:00 AM EST = +36; signal line is -14

1/3/12; 9:46 AM EST = +22; signal line is -16

1/3/12; 9:36 AM EST = +36; signal line is -17

1/3/12; 9:30 AM EST = +22; signal line is -19

1/1/12; 7:00 PM EST Starting 2012 Data = -10; signal line is -20

1/1/12; Begin 2012 Data Set = -10; signal line is -20; go long 1258; (Benchmark SPX for 2012  = 0%)(Keybot this trade = 0%; Keybot for 2012 = 0%)(Actual this trade = 0%; Actual for 2012 = 0%)

Keybot the Quant Begins 2012 on the Long Side from SPX 1258.


Note Added 2/14/12 at 5:21 PM:  Lots of high drama today.  Markets deteriorated after 2 PM today on news that the Greece talks were in trouble and the Euro finance ministers cancelled tomorrow's meeting.  In the final half hour of trading the news reversed with word that the Euro leaders will support the Greece resolution. The SPX jumped from 1341 to end the day at 1350.50. The broad indexes were purely news driven for this afternoon. Thus, Keybot is already 8 handles the wrong way on the short trade put on today, but, with 7% to start the year for the algorithm program itself, and over 10% for the actual trading so far, a give back of a couple percent is not biggie, if a whipsaw occurs tomorrow. Keybot will probably flip back to the long side if the SPX moves back above 1355, but, time is needed for the smoke to clear, before setting up tomorrow's action and looking at the levels that Keybot is now scanning.  For now, Keybot has joined the market bears, ending a two-month bull run, taking profits.

STOCK MARKET BULLISH -- LONG --CAUTION

Keybot the Quant remains long for eight weeks straight now, since mid-December. The robot moved from sometimes chaotic hyper daily activity, with as many as a dozen numbers printing out in any given day, in the Fall, to now a calm, steady-eddy two-month bull run. Those of you watching yesterday witnessed the high drama play out with the bulls and bears fighting over UTIL 451.17, and the market bears won out as the Monday session finished. The algo idled along sideways and did not print any numbers.

Moody's rating agency downgraded Italy, Portugal and Spain last evening so Asia stocks were lower on reduced growth prospects. This sets up the potential for exciting action in the commodites and copper markets today; two key areas that Keybot is now fixated on. For today, UTIL 451.17, CRB 311.20, JJC 48 and VIX 25 all figure prominently. Note that Keybot ratcheted up the CRB number again, and the VIX down, which actually makes these threshholds easier to cross for the market bears; the quant is constantly recalculating hte trigger targets. Utilities are currently creating market bearishness, but the commodites, copper and volatility (that remains low relatively) are currently keeping markets on the bullish side. 

For the SPX, starting at 1352, if the market bulls can push up and touch 1353.50, the upside will accelerate and the never-ending bull market will continue higher. The market bears need to lose the 1343 handle to return the markets to accelerated downside negativity.  A move thru 1344-1352 is sideways action. S&P futures at this writing show the SPX wants to begin the day about two points higher, which sets up drama at the 1353-1354 level at the bell, but the open is four hours away.  Markets remain extremely unstable and erratic.  Keybot is chomping at the bit to go short, and the algorithm is positioned to go short as soon as a few additional internals signals line up, but, for now, the algo remains on the long side. Commodities and copper are very important today. 

2/19/12; 7:00 PM EST =

2/16/12; 9:00 AM =

2/12/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/10/12; 10:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quuant remains long to start the new week of trading. The algorithm prints the Sunday number which results in no chage. Keybot wants to go short now but it continues to be held back waiting for final confirmation signals.  Utilities and commodities battled last week to a standoff; those two sectors as well as volatility and copper will play a key role this week.

If UTIL stays below 451.17 the broad markets will weaken.  If CRB stays above 310.50 the broad markets will maintain buoyancy. If VIX stays below 26.00 the broad markets will maintain buoyancy. If JJC stays above 48 the broad markets will maintain buoyancy. Thus, bulls want to be above UTIL 451.17, CRB 310.50 and JJC 48 and below VIX 26.  Market bears want to be below UTIL 451.17, CRB 310.50 and JJC 48 and above VIX 26. Watch the SPX:VIX ratio which now signals market bearishness ahead--unless  the ratio moves up and over 68.

For the SPX for Monday, starting at 1343, the 1351 level represents bull victory, and the 1337 support level represents bear victory.  A move thru 1338-1350 is sideways action. The market bulls need to see eight points in the futures overnight to make a run to 1351.  If the 1337 support fails, which is a six point drop, a move to 1326 is probably on tap.

The Greece austerity vote passed so the euro, and commodities and equities futures, are in a happy mood to start the week, but there are many hours before the U.S. open. Ten buildings are currently burning in Greece. Keybot prints out only one pre-scheduled number this week on Thursday.  The algorithm has remained calm for the last ten tading days; perhaps this week things will heat up and the algo will become more active. Stay on guard, markets are highly unstable. A failure at CRB 310.50 would likely trigger Keybot to go short. If CRB stays above 310.50, the market bulls will likely maintain market buoyancy.

2/19/12; 7:00 PM EST =

2/16/12; 9:00 AM =

2/12/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/10/12; 10:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long.  The algorithm did not print any numbers during the whole week.  This behavior verifies the sideways texture of the markets currently. The market bears are at an advantage to start next week with the utilities, UTIL, finishing under 451.17. Since the CRB did not lose the 310.50 level, now at 312.14, the market bulls were able to slide the markets sideways into the weekend and stop any significant downside.

Volatilty jumped to life late last week, the VIX now at 21. If VIX 26 is achieved the market bears will be selling the indexes substantially. Copper, JJC, will regain in importance next week as well. The JJC 48 level is of interest to Keybot currently, and if lost, the broad markets will experience strong selling.

Next week can be laid out in more detail tomorrow after the pre-scheduled Sunday print. The algorithm has been sleepy, simply idling along with no change for about 10 trading days now, staying steadily on the bull side, but now very close, only a single hair away from going to the short side.  UTIL, CRB, VIX and JJC will require close monitoring as trading begins Monday. Markets remain highly unstable, extreme caution is required. 

2/19/12; 7:00 PM EST =

2/16/12; 9:00 AM =

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST = +48; signal line is +49 but algorithm says stay long

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long as the pre-scheduled number prints resulting in no change. The internals of the algorithm are only one single hair away from going short but the proper signals are not in place yet, thus, Keybot remains long. The CRB needs to drop a couple more points to move under 310.50 if the bears want mojo.

Utilities are weak and volatilty continues higher, the VIX back above 20, both bear-friendly. Markets remain unstable. Tech is not leading the market downside today, tech and the broad market are both moving down about equally, thus, the downside is muted.  Bears would need to slam tech harder to increase negativity, and that means AAPL would need to go down, but Apple is up on the day today.  The drama continues, Keybot is on the verge of going short but remains long for now.

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST = +48; signal line is +49 but algorithm says stay long

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

Note Added 2/10/12 at 10:11 AM EST:  As the above missive was written, AAPL went negative on the day today but now has hopped higher again. The SPX is testing 1337 support. Bears need to push AAPL lower to develop downside momo, if AAPL stays lofty, so will the broad indexes. SPX 1337 support held on the first assault.

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long and continues to simply idle along each day without printing any numbers. The utilties sector does not want to go up, and the commodities do not want to come down, hence, a market standoff, and each day the market bulls float the indexes upwards.  Futures are lower as this is written so perhaps today's session will provide some excitment in front of the weekend.

Watch CRB 310.50 and UTIL 453.69 to gauge the bull versus bear advantage.  UTIL is now under the 453.69 so bears are happy while CRB is now above the 310.50 which makes bulls happy. One of these will crack and show the broad market direction moving forward. For the 4 PM print to end the day today, pay attention to UTIL and the 451.17 number.  The quant was watching 453.69 this week; next week it will be watching 451.17. Thus, if UTIL closes above 451.17 today at 4 PM, the market bulls will be favored to begin Monday.  If UTIL closes today under 451.17, the market bears are gaining strength and easily capable to push the broad markets lower as next week begins.

For the SPX, starting at 1352, if price is pushed above 1354, the upside will accelerate in the never-ending bull rally.  If the market bears can lose the 1345 handle, about seven points lower, the broad indexes will sell off in force. Note that the futures are projecting about a seven or eight handle drop at the open, thus, the robots are already fixating on this 1345-ish area for a fight. A move thru 1346-1353 is sideways action.

Keybot prints a pre-scheduled number at 10 AM this morning, so the action can be updated at that time.  Markets are highly unstable currently. A turn appears imminent.

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST =

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long, the beat goes on.  Another sideways-style day today for the broad markets.  Tech continues to buoy markets.  The algorithm wants to go short but has not received the proper line up of signals yet. In addition, the algorithm has not printed any numbers this week, now three days old.  China CPI and the ECB rate decision and press conference, as well as the Greece drama, will all play a role in the coming hours.

The quant is fixated on the utes, UTIL 353.69, where the market bulls will win, and, CRB 310.50, where the market bears will win.  Perhaps we finally receive a decision tomorrow.  For the SPX for Thursday, starting at 1350, the market bulls have the easy road again, only needing one measley point, to 1351, and the upside will accelerate in yet another bull rally higher.  The market bears therefore, need to keep the futures red overnight, and to push under the 1342 handle, eight points lower, if so, the market bears will accelerate the selling in the broad indexes. A move thru 1343-1349 is sideways action.

Markets are highly unstable currently, extreme caution is required. A turn may be imminent.

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST =

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long. The algo continues to want to flip short but has not received the proper trigger signals yet.  The main tell today was the CRB staying elevated, closing at 315. This commodity strength brought the markets back up as the day played out.  Tech was not leading the markets today which is a sign of potential exhaustion.

The quant has only printed pre-scheduled numbers since 1/30/12, seven days ago! There has been no prints during trading hours for several days.  The utilities actually came close to breaking out to signal stronger market bullishness, but received a spank down before the day ended.

You know the drill.  Watch UTIL 453.69 and CRB 310.50. Above UTIL 453.69 and the bulls take markets another leg higher. UTIL staying under 453.69 and CRB over 310.50 results in more sideways slop for the broad indexes.  Failure of CRB 310.50 will result in substantial broad market selling.

For the SPX for Wednesday, starting at 1347 support, the market bulls have an easy road ahead only needing to punch up thru 1349 resistance to set off an accelerated move higher for the broad markets.  The market bears need to lose the 1336 handle, about eleven points lower, and that will trigger strong selling in the broad indexes. The SPX 1337 level is critical strong support, however, so if the 1337 would fail, the 1336 will likely give way as well. A move thru 1338-1346 is sideways action. Stay on guard for a potential turn at any time.

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST =

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long.  Keybot continues to idle along without printing any numbers; the markets remain calm. The utilities, UTIL, remains below 453.69, market bearish. The CRB is at 313.90, three points above danger at 310.50, so the commodities remain market bullish.  Hence, the broad indexes move sideways.

The SPX came down and bounced off the 1337.50 number at 10 AM.  How does Keybot know these numbers ahead of time?  SPX wrestled with 1337.50, then pierced down thru but wihtin seven minutes popped back above and recovered.  SPX is now printing a 1340 handle, check that, a spike over 1341 now. So the market bears were trying to push lower but without the commodites cooperating to a greater extent, as well as technology, the bulls continue to create market buoyancy.  Exercise caution.

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST =

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long but the quant is chomping at the bit to go short. The algo number is below the signal line indicating a preferred move to the short side but the algorithm must line out other programming rules before the move to the short side occurs. The algo did not print out any numbers in the Monday session.

The drama for the broad markets centers around two sectors that should dictate broad market direction; utilities and commodities. UTIL remains under 453.69 and CRB remains above 310.50.  These levels of interest are constantly recalculated by Keybot; note that the CRB number is moving up which makes it easier for the market bears to necessitate the turn. CRB starts today at 314.20 about 3 to 4 points above danger.

If the market bulls move UTIL above 453.69, the upside bull party will kick into gear again for another leg higher.  If UTIL remains below 453.69 and CRB remains above 310.50, as it is now and was yesterday with no change, then the markets continue to stumble along sideways.  If the CRB drops under 310.50, the market bears will finally be able to stop the upside momo and hand the markets some noticeable downside.

For the SPX today, starting at 1344, closing at the highs yesterday, if the market bulls can simply provide green futures, even by a few pennies, this will be enough to accelerate the broad markets higher.  Alas, futures are red as this is written and perhaps leaking lower slowly.  The market bears need to push the SPX down to touch the 1337.50 level.  The 1337 level is key support and held yesterday favoring the bulls.  If 1337.50 is touched, however, about seven points lower, the downside will accelerate with large block sellers entering in force. A move thru 1339-1343 is sideways action.

The quant remains on the edge of flipping short but needs to see a few more key items to fall into place to trigger the turn.  If CRB drops under 310.50 and the SPX touches the 1337.50 level, Keybot will likely flip to the short side.  The algorithm continues to sleepily move along each day since the markets are in a sideways rest mode waiting on the Greece resolution, key earnings, and the China CPI number tonight.  Stay on guard, these current markets are highly unstable and not to be trusted.

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST =

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long as the algo idles on the weekend.  The Sunday number results in no change; the algo number is under the signal line showing that the quant wants to go short right now, immediately, but, there are other rules the algo has to satisfy before the move to the bear side triggers, and all the ducks are not yet lined up.

The most likely trigger of Keybot moving to the short side would be if the commodites, CRB move lower.  If the CRB drops under 309.50, the broad markets should finally experience a strong sell off providing a respite from the ongoing rally action. This makes the RBA (Austrailia) rate decision overnight tonight critical. Currency, commodities and mining sectors will immediately react.  Likewise the China CPI overnight Tuesday night into Wednesday.

Continue watching the utilities as well. Last week, the utes locked in the first downtrend week (in comparison to the weekly close 15 weeks prior) in many months. This is significant and very bearish for markets. This week, the utilities will log a second downtrend week if UTIL stays under 453.69. If UTIL stays under 453.69 and the CRB drops under 309.50, the broad markets will sell off strongly this week.  If UTIL moves above 453.69, believe it or not, the market bulls will run the indexes even higher and this will negate the ute weekly downtrend move.

For the SPX, starting at 1345, and bullish euphoria at a fevers pitch, if the market bulls simply keep the overnight futures green, even only by a smidge, the market bulls will continue the upside bull party. The bulls need to simply move the SPX less than a point higher above 1345.30 and the broad markets will accelerate higher.  The market bears need to obvously prevent the green futures from occurring, and that depends on what the RBA has planned, and push the SPX lower to lose the 1326 support level.  If 1326 is lost, the selling will dramatically accelerate. Dip-buyers may be tempted to enter at 1326, however. A move thru 1327-1344 is sideways action.

Keybot has remained long since SPX 1240 on 12/20/11 (the left margin shows SPX 1258 and 1/1/12 since that zeroed the statistics to start this year), 105 handles ago.  What a run for the bulls.  UTIL and CRB will decide broad market direction moving forward. Keybot prints only one pre-scheduled number this week on Friday morning.

2/12/12; 7:00 PM EST =

2/10/12; 10:00 AM EST =

2/5/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

STOCK MARKET BULLISH -- LONG - CAUTION

Keybot the Quant remains long. Every time it appears Keybot is ready to flip to the short side, the market bulls find a way to continue the party.  For the new trading week, UTIL and CRB will be key again, especially the 453.69 and 309.50 levels, but the algo can more accurately identify the numbers after the Sunday pre-scheduled number prints tomorrow.

Note that for last week, the algo only printed four numbers--and three were pre-scheduled numbers. The calm before the storm?  Keybot wants to go short as shown by the algo number below the signal line but other programming rules continue to hold Keybot back, for now. Tomorrow we can take a look at the path forward.

2/5/12; 7:00 PM EST =

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

1/31/12; 7:00 PM EST EOM = +48; signal line is +48 but algorithm says stay long

1/31/12; 10:00 AM EST = +48; signal line is +48 but algorithm says stay long

1/30/12; 9:30 AM EST = +48; signal line is +48

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long as the Friday pre-scheduled number clicks off minutes ago. The algo number is now under the signal line indicating that the quant wants to go bearish but other programming rules are not lining out yet, thus, Keybot remains long. The Monthly Jobs report number minutes ago was a blow-out positive number so futures are flying this morning and providing support to the bullish case for the broad markets.

The bull-bear struggle continues. Very simply, if the market bulls move UTIL above 452.66 today, the upside bullishness will continue along moving forward.  If the market bears push CRB under 309.50, the downside bearishness will continue along and Keybot will likely flip short. For the closing print today, see if UTIL closes above 453.69, or not. The 453.69 is the UTIL number to watch next week which will influence markets bullishly or bearishly, depending on whether the number is above or below 453.69, respectively. Thus, the closing number for UTIL at 4 PM today is important.

For the SPX today, starting at 1326, the market bulls only need three points higher to move above 1329 to set off extended upside. The positive lift in the futures shows this to be a done deal at this juncture, so the upside will run much higher, the resistance levels of 1331 and 1333 should be tested quickly. SPX 1333 likely to see a lot of action today. The market bears need a move down under the 1322 handle to  gain any downside momo.  A move thru 1323-1328 is sideways action.

The bulls look to continue the upside fun today--watch UTIL 452.66 to see if it confirms further bullishness ahead, or not.  Markets remain highly unstable experiencing this upside rally on low volatility and low volume. Caution is warranted.

2/12/12; 7:00 PM EST =

2/5/12; 7:00 PM EST =

2/3/12; 9:00 AM EST = +48; signal line is +49 but algorithm says stay long

1/31/12; 7:00 PM EST EOM = +48; signal line is +48 but algorithm says stay long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long but a change may be in the air.  With all the bullish action yesterday, the bulls could not push UTIL up thru 453, specifically 452.66. This is a feather in the bear's cap.  The key this morning, and trading begins shortly, is the commodities index, CRB. If CRB drops under 309.50, Keybot will likely flip short.

For the SPX, starting at 1324, if the bulls push above 1330.50, the upside bull party will accelerate.  With futures flat to lower, and the vibe feeling negative today, at least for the open, this bull scenario is challenged.  The market bears need to push under the 1313 handle and that will ignite an accelerated downward slide in the broad markets. Thus, 13-13 is truly an unlucky number for the SPX and markets today.  A move thru 1314-1329 is sideways action.

Markets remain highly unstable. Expect a turn by Keybot at anytime. CRB 309.50 is the key.

2/5/12; 7:00 PM EST =

2/3/12; 9:00 AM EST =

1/31/12; 7:00 PM EST EOM = +48; signal line is +48 but algorithm says stay long

1/31/12; 10:00 AM EST = +48; signal line is +48 but algorithm says stay long