SPX S&P 500 Weekly Chart

It is comical and standard fare. All the jackasses that did not call the top in the stock market are now calling the bottom--every day. People lost their money because their financial manager did not see the top, but the same fools call the same managers asking them what to do next. The dip-buyers are rabid willing to bet their home on a new rally.

The euphoric bullishness remains off the charts and is especially noticeable since everyone says it is not occurring. Folks may diss the market, but 10 minutes later they are buying stocks. Doesn't any of these idiots look at charts? No, they don't.

The red lines show the Keystone top call. It is nothing fancy or hard to do. Price kept making higher highs but ALL the indicators ran out of gas and began sloping down as price made the new highs. This is called negative divergence and is how you call the tops. Once the neggie d forms, there will be a neggie d spankdown in that timeframe. This is a weekly chart so a multi-week down move was forecasted and occurs.

The selloff is 4 weeks along and again, everybody and his bro are buying the dips, one moron after the other wanting to be the hero. Jesse Livermore they ain't. Look at the chart. What do you see? Nasty. The RSI moves below 50% into bear territory and is weak and bleak. Ditto the stochastics. The MACD, histogram and money flow are also weak and bleak. Sure, stocks are set-up for a relief rally in the very short-term looking at the daily chart, but the weekly chart above tells you that many weeks of weakness remain ahead.

Price has stabbed through the lower standard deviation band so a move back up to the middle band at 5953 is on the table going forward. The selling volume is massive and it is had to imagine how this would ever be overtaken by buying volume in the future. Institutions are locking in profits and leave Joe Sixpack and Carmelita Sucka holding the bag of excrement at the top. Just think of all the television hype since the Fall with one commentator after another pumping and dumping telling you to, "buy, buy, buy!" Well, anyone that chased stocks above 5800 on the hype, and took the shares that the smart money was distributing, got, "hosed, hosed, hosed."

The pink ADX box shows that the strong trend higher in the stock market ended at the end of last summer around Labor Day. That is another tell of a top. The strong trend higher is gone but the index keeps making higher highs; you know something is amiss.

The Aroon red line is humorous. Another reason for the top, Keystone discussed all this in prior charts when he was calling the top, was that all the bears were 100% bullish on stocks just like the bulls. That was funny. Now the red line spikes to 100% so all the bears are finally bearish again. Equally funny, is the Aroon green line that shows the bulls have not budged an inch. As discussed at the start or this post, the bulls remain super bullish even though the stock market is off about -7% from the record high. The bulls still need taught a lesson because there is no fear in the market. Stocks need to be bludgeoned until the bulls panic so the beatings will continue until moral improves.

The CPC put/call verifies the ongoing uber bullishness in the stock market despite the collapse in equity prices. The CPCE, however, did spike into panic and fear, for one day, creating the runway for the Friday stock market orgy, but is now down in complacent territory again. There are many metrics verifying that the bulls simply remain too bullish so additional spanks, smacks, and slaps are needed on the weekly basis.

The daily chart is set-up with some positive divergence and stocks need at least a dead-cat bounce to catch their breath. The fall from grace has been impressive. Fed Chairman Powell speaks on Wednesday so stocks will likely be in a holding pattern until he flaps either his dovish or hawkish wings and dictates how traders should trade. Typically, stocks are up 80% of the time on Tuesday and Wednesday into the Fed drama.

Happy St Patty's Day. It is springtime so Keystone is letting that famous Irishman, Pat-i-o Furniture, out of the shed. 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 Saturday, 3/22/25: The SPX 50-week MA is the 5665 palindrome and the critical SPX 12-month MA, that separates a cyclical bull market from a cyclical bear market, is the ominous 5666. Monday above, Tuesday below, Wednesday above, Thursday below, Thursday above, Thursday below, Friday above. The week ends at SPX 5668.The stock market is spinning round like Natalie singing Hey Jack Kerouac. In the last minute of trading for the week, the market makers push the S&P 500 up over the major 5665-5666 demarcation line parking it there for the weekend. Of course they do. The saga will continue next week. This was the action all week long and yet not one talking head on the internet or television highlighted this drama. They simply do not know what to watch. If you are long the market, and the SPX slips back below 5665 and trends lower, you will lose a lot of money as the cyclical bear growls.