Keybot the Quant Turns Bearish

Keystone's proprietary algo, Keybot the Quant, flipped to the short side today at 2:02 PM EST at SPX 1207. This move locks in the gains from the eight day recovery rally starting at SPX 1146 on 8/23/11.

The retail, copper and commodites sector joined the bull camp yesterday, as measured by Keystone's algo, but things change quickly in a high volatility market. All three are back in the bear camp now. The GS news this afternoon tanked the financials dragging the broad markets lower.

Thus, Keybot is short going into the jobs report tomorrow morning. Some negativity was priced into the markets already today to provide insurance against a bad jobs number. As always, stay on guard for a whipsaw move by Keybot over the next trading day or two, especially in these tricky markets.

For more information and the real time print outs of Keystone's algo, reference:

http://www.keybotthequant.blogspot.com