SPX support, resistance, moving averages and other important levels are provided below. The uber strong support at 1326 cannot be understated. Likewise, the strong resistance at 1337-1338. The gauntlet of strong S/R between 1326-1338 is extremely important, and price played in this zone all day Friday. A break above 1338 will cause bulls to throw confetti. A move below 1326 will cause the bears to celebrate.
The strongest levels of S/R currently are 1337, 1331, 1329, 1326, 1316, 1314 and 1278. The price action move out of the bracket created by the 50-day MA above at 1345, and 20-day MA below at 1321, is very important and will dictate market direction going forward. For the SPX for Monday startting at 1335, the bulls need to touch the 1338 handle and the markets will accelerate higher, breaking thru the critical 1337-1338 resistance and setting up a test of the 50-day MA at 1345. The bears need to push under the 1326 level to accelerate the downside. If a 1325 handle prints, the markets will drop with the SPX testing the 20-day MA at 1321 in quick order. A move thru 1327-1336 is sideways action.
· 1372
· 1371(5/2/11 Intraday HOD for 2011: 1370.58)
· 1370
· 1369
· 1366
· 1364 (4/29/11 Closing High for 2011: 1363.61)
· 1363
· 1361
· 100-day MA 1359.86
· 20-week MA 1359.36
· 1359
· 1358
· 1356
· 1351
· 1347
· 50-day MA 1344.93
· 1344
· 1343
· 1341
· 1338
· 1337.82 Friday HOD
· 1337
· 1336
· 1335.02 Friday Close; the New Week Begins Here
· 10-day MA 1333.89
· 1333
· 1332
· 1331
· 1329
· 1326
· 1325.92 Friday LOD
· 150-day MA 1325.84 (150-Day Slope is a Keystone Cyclical Signal)
· 1324
· 1321
· 20-day MA 1320.51
· 1319
· 1318
· 1316
· 1315
· 1314
· 1312
· 1310
· 1308
· 1307
· 1305
· 10-month MA 1301.91
· 1300
· 1298
· 1296
· 200-day MA 1295.61
· 1295
· 12-month MA 1294.19 (a Keystone Cyclical Signal)
· 1293 (10/27/11 Intraday High 1292.66)
· 1292
· 1289
· 1287
· 1286
· 1285
· 50-week MA 1284.23
· 1281
· 1278
· 1277
· 1275
· 1272
KS, I noticed that Keybot is using SDS which is a 2X short for the first time this year. Do you anticipate a major downturn coming soon? Arnie, are you also shorting with SDS?
ReplyDeleteSteve
Steve, Keybot is using the 2x short SDS currently. If a whipsaw occurs with the model, which still may occur since a 48-hour timer is used, thus, 1:39 PM on Monday the whipsaw window would end, but if no whipsaw occurs, Keybot will use the 2x's here on out. If a whipsaw occurs, this tells the quant that markets are trending in more of a sideways pattern, so the model reduces risk to the single ETF's since additional whipsaw's may occur, once the market opens up in a more firm direction, up or down, it does not matter, after 45 days have passed from the last whipsaw, the model then moves back into 2x ETF mode. Keybot was using SDS and other 2x's this year, back in February but that is when the rolling top started to occur in the markets and the sideways trend started creating whipsaws.
ReplyDeleteKeystone's positions are always posted on the Positions and Picks page. Keystone has six positions on the short side currently; TZA, shorting T, shorting retail with thinly traded RETS and SZK, short utes with thinly traded SDP, and long volatility with VXX.
As a follow up question KS, did Keybot ever used a 3X fund to long/short the general markets?
ReplyDeleteSteve
Steve, Keybot is limited to using single and 2x ETF's. If a whipsaw occurs, Keybot then operates with a single ETF for 45 days, if no whipsaw has occurred the robot clicks back into 2x ETF mode.
DeleteSteve, yes currently I use SDS. Sometimes I use SH if I think the downtrend is less clear and I don't want to be whipsawed as bad.
ReplyDelete