Tuesday, April 8, 2014

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains short moving towards the Wednesday session. XLF provides drama today closing at 21.86, one penny on the bear side of the critical 21.87 level identified by the algorithm. It is amazing how Keybot can identify these levels before they occur. Financials remain key and the pivot from XLF 21.87 dictates market direction. Bulls win above XLF 21.87. Bears win below 21.87. There is also drama with volatility again and the VIX 14.59 level must be monitored. VIX is 14.89 causing negativity (volatility moves inverse to equities) so bulls need VIX under 14.59 to launch markets higher.

For the SPX starting at 1852, the bulls need to touch the 1855 handle, only a couple points higher, and the upside will accelerate. Watch the overnight S&P futures to see if the bulls can muster up +2 or more which will indicate more market upside ahead. Bears need to push under 1837.50 to accelerate the downside. A move through 1838-1854 is sideways action for Wednesday.

The pivot from XLF 21.87 dictates market direction so listen intently for any bank news overnight. If both XLF moves above 21.87, and VIX drops under 14.59, and the SPX moves above 1855, and all three of these parameters remain bullish, Keybot will likely flip long. Otherwise, the bear side remains in favor. For now, the bears continue driving the bus and will ride to victory if they beat the banks lower. If either VIX or XLF turn bullish, the caution flag will reappear; if both turn bullish the imminent turn notation would be in affect since the bulls will be running equities strongly higher.

4/11/14; 10:00 AM EST =
4/8/14; 2:11 PM EST = +17; signal line is +44
4/8/14; 1:23 PM EST = +33; signal line is +45
4/7/14; 3:57 PM EST = +17; signal line is +45

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