Sunday, December 21, 2014

BPSPX Bullish Percent Index Daily Chart

The BPSPX indicator remains on a double whammy market buy signal. When the BPSPX reverses six percentage-points to the downside a market sell signal occurs and under 70% is a double whammy sell signal. When a six percentage-point reversal to the upside occurs a market buy signal is issued and if the BPSPX moves above 70% a double whammy buy signal occurs which remains in place.

The bears had a victory in place on a silver platter but were smacked in the teeth by Fed Chair Yellen. The recent top is at 76.40 so six percentage-points lower is 70.40 almost exactly at the 70 level. Thus, as of Wednesday, 12/17/14, before Yellen flapped her dovish wings, the markets were on the verge, only a hair away, from a double whammy market sell signal. The Fed is not stupid; they have a room full of technicians warning of the pending doom. Thus, Yellen announces that the 'considerable time' statement remains noted in the FOMC statement (the expectation was that the statement would be removed) so the first rate hike is not coming for six months or more in H2 2015 which creates the thrust higher in stocks. The central bankers are the market. The rally move is an exact repeat of the mid-October bounce. Stocks are not turning higher due to technicals and fundamentals, quite the contrary, instead markets are goosed by the Fed. Yellen, the Keynesian femme fatale, strikes again.

The BPSPX  bounces from 70-ish stopping the double whammy sell signal from occurring. Bulls celebrate all weekend long drinking Fed wine and injecting ECB crack cocaine into their veins ready to buy more stocks in the week ahead. The bulls remain on a double whammy buy signal. The bears need to push under 70% to create a new round of market mayhem. Keep watching the BPSPX 70% level into 2015 as a key market indicator. 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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