Sunday, February 8, 2015

BPSPX Bullish Percent Index Daily Chart

The bulls punched the bears in the face last week. The bears were on a double-whammy sell signal since the year began but the bulls created a six percentage-point reversal from 60 to 66 in the BPSPX receiving a market buy signal. For the BPSPX, watch the six percentage points reversals to identify the trend change in the stock market and then a double-whammy confirmation occurs depending on where price is in relation to the 70% level.

In October the bottom was in for the stock market with the initial market buy signal from 42 to 48. The double-whammy buy occurred in November and the bulls enjoyed a party during the Fall. The BPSPX tops out at 76 so conveniently, the drop through 70 created the double-whammy sell signal to begin the new year.

So the signal is a mixed picture now but the advantage is given to the bulls since they performed the six percentage-point turnaround. There are two possible paths forward, one to create happy bulls and the other to create happy bears. If the BPSPX moves above 70 during the week ahead, the double-whammy buy signal occurs and stocks are going to run to their all-time highs. The all-clear signal will be given for another central banker-induced equity rally. The Fed wine will flow like water. The bears need to create a six percentage-point reversal to regain control. Price is at 68.20 so this would be the 62.20 level where bears declare double-whammy downside victory ahead and stocks will be selling off in force. So check the BPSPX each evening this week and you will know the market direction answer. 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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