Sunday, November 16, 2014

UPS United Parcel Service Weekly Chart 20/50 MA Cross Negative Divergence Developing

The UPS 20/50-week MA cross is an important Keystone cyclical signal that has not been worth talking about since the bulls created the positive 20/50 MA cross in February 2013 confirming the long-term upside rally ahead. If the 20-week MA falls down through the 50-week MA it is curtains for the stock market. UPS is a global shipping bellwether and a happy UPS makes for happy stocks while a sad UPS makes for sad stocks. The 20/50 cross tells you who is winning.

After the September-October stock market selloff, UPS bottomed in mid-October like everything else did when Fed's Bullard signaled the end to the selling by keeping quantitative easing on the table. Central banker money printing has gotten the markets this far in six years so more goosing continues to work. Other dovish Fed members parrotted Bllard's comments, then the BOE promised more stimulus, then the PBOC injected billions into the Chinese economy, then the ECB promised action, then the BOJ fired the shock and awe money bazooka on Halloween promising more QE then at the ECB meeting President Draghi provides more lip service concerning future QE. That is how the central bankers created the parabolic rally spike over the last four weeks.

UPS led and has rolled over first printing a down week last week. UPS painted a rosy picture a couple months ago boosting guidance and promising blue skies and rainbows ahead but last week walks back the hype. Note how the bears were about to receive bear market cyclical confirmation with the negative 20/50 MA cross three weeks ago. The central bankers have chart technicians telling them they are in trouble; this is why the market recoveries always occur when markets are on the verge of falling into the rabbit hole. The bankers saw the writing on the wall therefore the coordinated QE guns were fired to avert disaster and the 20 MA recovers higher temporarily stopping the negative cross.

The red lines show negative divergence remaining over the multi-month and one year period. There is short term long and strong momo there to make another higher high, however, the goosing by the central bankers is going to probably disappoint traders moving into 2015. Neggie d should remain for the multi-month period and will form for the near-term rolling price over to the downside again and allowing the 20 MA to roll over and make a run at a negative 20/50 cross again probably as the new year begins. For now, the 20 MA is above the 50 MA maintaining a cyclical bull market. How much longer will it last? 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.

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