SPX S&P 500 Weekly Chart

The red lines show negative divergence developing for the S&P 500 weekly chart. Neggie d cannot occur until price takes out the late-January record highs but nonetheless the lagging indicators as compared to January is striking. There is near-term momentum with the RSI, MACD line and money flow trying to maintain an upward move in stocks.

Price tapped the upper standard deviation line very briefly three weeks ago and remains near the upper band. The SPX will likely venture towards the middle band, the 20-week MA, at 2735, and rising, in the weeks ahead.

The blue boxes show the earnings reporting seasons where the bulls clearly create upside in the stock market on the orchestrated beats. The brown circles show several weeks of distribution this year where the smart money is dumping off shares to the dumb money. When stocks pop one week, the next week Joe Sixpack runs into the stock market all hyped-up on news reports and the smart money hands the sucka some shares.

For the big rally the last few weeks, note that none of the volume candlesticks are stronger than the volume in early June at 2775-ish. Price may want to revisit this area. The last few weeks of volume has also not overcome the two strong selling week's volume in late June. This hints that the retail investor is likely caught up in the market hype and buying stocks afraid that he is missing the train leaving the station.

The stochastics are overbot agreeable to a pullback going forward. The ADX was in a strong uptrend (purple box) late last year into early this year and the record top on 1/26/18, but that strong uptrend is no longer verified and has petered out with the ADX dropping to 22.3. Despite the big six-week advance in stocks, the trend is not strong.

The SPX is near its record high at 2873, only about 20 points away, so the euphoria and daily hype may take her there, much like AAPL last week where the $1 trillion valuation goal fed on itself and price migrated there. Overall, the expectation would be for stocks to stall in the weekly time frame and roll over going forward.

The new moon peaks on Saturday (as well as the Perseid meteor showers so get outside in the evening to watch the shooting stars), and stocks are typically bearish through the new moon each month. OpEx is next week so stocks may rally from Tuesday, 8/14, into a Wednesday, 8/15, high. Keystone's eclipse indicator points to a potential major top occurring in the stock market between 8/13 and 9/10. 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.