Wednesday, November 19, 2014

BPSPX Bullish Percent Index Daily Chart Market Buy Signal

The bulls punch the bears in the face yesterday with the BPSPX moving above the critical 70% level. For the BPSPX, a market sell signal occurs when a six percentage-point reversal occurs to the downside and a double whammy sell signal occurs when price drops under 70. A market buy signal occurs when a six percentage-point reversal occurs to the upside and a double whammy buy signal occurs when price crosses above 70.

The bears receive the market sell signal at the end of July and the double whammy sell signal in September which accurately forecasted and confirmed the market selloff into mid-October. The bulls fight back creating a market buy signal off the bottom and markets were conflicted with a sell signal under 70 and a buy signal for the six point reversal. Yesterday, the bulls push above 70 creating the double whammy buy signal which forecasts more upside ahead and the SPX headed to 2060-2080.

Since the move occurred yesterday, the bears have a window today, perhaps tomorrow, to reverse the BPSPX and get it back under 70 to negate the double whammy buy and stop the market rally. Otherwise, above 70, the bulls will receive a joyous holiday season of upside in equities. Check the BPSPX over the next two days to see if the bulls maintain the go-signal for further upside, or not. The bears need to push the BPSPX under 64.40 (70.40-6) to return to a double whammy sell signal where markets will sell off in earnest. Markets are at a key inflection and by the weekend you will know who is the likely winner into year end. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 8:05 PM: The SPX loses a few points today, no biggie, and the BPSPX remains dead flat at 70.40. This is a blow to market bears since they need to get the BPSPX under 70 as soon as possible. The Thursday session is important. Each day the BPSPX stays above 70, the SPX 2060-2080 becomes more of a reality.

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