Monday, January 25, 2016

BPSPX Bullish Percent Index Daily Chart

For the BPSPX, the six percentage-point reversals are a key signal as well as the 70% and 30% levels. When the BPSPX moved higher during the October rally the BPSPX was on a double-whammy buy signal but that started to falter the second week of November when price lost the 70% level. Then when the BPSPX fell through 66.20 that was a six percentage point reversal off the peak top locking in a double-whammy sell signal. The rest is history. Stocks tumbled lower.

The 30% on the bottom side is just as important as 70% on the top side. As the BPSPX crumbles lower and violates 30% and lower, there is likely a base forming and stocks will be contemplating a recovery rally in the near future. The BPSPX prints a near-term bottom at 23.3. Thus, adding six percentage points is 29.3. If the BPSPX moves above 29.3 that will be a market buy signal and if the BPSPX then moves above 30% that will be a double-whammy buy signal. For now, the stock market bears maintain pressure.

Bears must keep the BPSPX at 29.3 or lower. Bulls will begin creating a substantive recovery rally in stocks if the BPSPX moves above 29.3 then above 30. Who will win? 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 12:47 PM EST: Whoa. That is interesting. The minute the above was posted the BPSPX is now printing 29.40; the bulls may be making a move. Keep a close eye on it.

Note Added 8:24 AM EST Tuesday Morning, 1/26/16: Interestingly, the BPSPX finishes at 29.40 which is an initial market buy signal despite all the selling. The Dow dumps over 200 points as the Monday session played out. Watch the 30% level closely and if bearish the markets, you need the BPSPX back under 29.30 pronto, and definitely by the closing bell, otherwise, the bulls will likely keep building higher and begin the long-awaited relief rally; if 30 is taken out to the upside stocks will start catapulting higher as shorts cover creating rocket fuel.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.