Thursday, November 3, 2016

BPSPX Bullish Percent Index Daily Chart

The BPSPX remains on a double-whammy sell signal. The 70% and 30% levels and the six percentage-point reversals are key. In June, the stock market bottomed and began rallying. The BPSPX issued a market buy signal in early July on the six percentage-point reversal from 50 to 56. Price went above 70% which created a double-whammy buy signal and stocks were joyous through August into September.

The BPSPX reverses 6 points from 77 to 71 issuing a market sell signal and the loss of the 70% level in early October is a double-whammy sell signal which remains in effect. The SPX was at 2160-ish when the double-whammy sell signal occurred and is now down to 2089.

The bulls need a rally and the upside can be verified only after the BPSPX reverses 6 points. From the current 50.40 print, that is 56.40 for a buy signal. Other than that, the bears remain in charge. During a recovery move which should occur at anytime, watch the BPSPX since if it only goes up to 54-55 and rolls over again you know that will be bearish. But if price moves above 56.40, the upside rally is real. Of course if the BPSPX moves lower tomorrow, then the 6 point reversal is calculated from that low point. Keep an eye on the BPSPX as a tool. 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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