SPX S&P 500, SPX Equal-Weight and SML Small Caps Monthly Charts; Historic Stock Market Top At Hand

The historic stock market topping drama continues fueled by Fed rate-cut talk and King Donnie happy talk. However, the 3-month topping behavior continues and the stock market remains poised for major long-term downside ahead. It is funny that many bulls now opine that they are concerned about the path ahead but 10 minutes later are buying stocks. Or the business media hyping that September is the worst month of the year, and it is, but the bulls sing in unison that any dip should be bot. The bulls know its over but they Can't Let Go a la Lucinda.

There is lots of dribble talk nowadays about the SPX index versus equal-weight versus the small caps. That is stupid talk that does not tell you anything. Look for the neggie d to guide you. All the charts above are monthly charts so think many months and even a few years for the road ahead.

Analysts and strategists pontificate that the small caps will play catch-up and make new highs carrying the overall stock market into greatness in 2026. What are they smoking? Whatever it is, it fried their brains. Look at the chart. Small caps were completely cooked on the monthly basis to start the year. The SML peaks in price with all the chart indicators in negative divergence wanting to see a spankdown and voila, it occurs. There is no reason for price to come back up for a higher high since all the chart indicators are out of fuel. Price rallies the last 4 months because everything else rallied because of Fed rate-cut talk and King Donnie happy circus talk each day.

A new candlestick begins on Tuesday for the charts above so reassess the entire analysis for each that should provide confirmation of the death nail for stocks. The SML price is not up to the highs at the start of the year so the indicators cannot be assessed as yet but all remain sloping lower. Again, there is no reason for price to make a higher high for SML since it was cooked on a monthly basis to begin the year. The bears got jipped because the news hype rallied stocks off April lows (not a positive divergence set-up). Therefore, there is plenty of unfinished business down below.

The RSI and stochastics for the SML sneak higher back into bull territory above the 50% line so they are trying to create a higher high but it appears to be a formidable task. When the small caps topped out in 2021 going into 2022, during the COVID-19 pandemic, the indicators were neggie d sans the MACD that would have been okay with another price high, which occurs 3 years later, but then that was the top since all indicators were toast. Note how the volume candlesticks for March and April remain higher than any of the buying volume candles during the last 4 months. Price will want to go down to test the prices from April again.

Does that analysis sufficiently slap the small cap narrative silly? Small caps have nothing to prove and do not need to come up for new highs; they simply need to continue to roll over and die.

The SPX equal-weight SPXEW chart is shown above and business media needs to fill air and internet time so there are always stupid discussions comparing the two. Forget that dribble. Instead, watch for neggie d if you want to call the top. The blue rising wedge is an ominous bear pattern. The red lines show universal neggie d across all indicators; she's cooked. The SPXEW needs to receive a smackdown and begin a multi-month, perhaps multi-year, move lower.

Note how the MACD line was still long and strong at the top for SPXEW to begin 2022. The other indicators were all neggie d so this set-up told you that the chart would receive a negative divergence spankdown and multi-month slump ahead, but price should come back up for a higher high since the MACD still had fuel in the tank on a monthly basis. Voila, it took 3 years but price came back up using the fumes remaining in the MACD tank.

When price topped out at the end of last year and to begin this year, the chart was in full neggie d needing another smackdown, and it occurs. There was no reason to come back up again, like the SML chart, but price does manage its way higher for a matching high. The indicators remain neggie d. The chart is a turd and needs to receive its slapdown and begin the multi-month move lower.

The SPX chart, that is the United States stock market, the S&P 500, displays similar behavior to the equal-weight and small caps, but it put up a stronger fight to print new price highs (due to the tech stocks and AI bubble behavior). The SPX topped out to begin the year in January and February but the MACD was still long and strong wanting to see more bull fun ahead. The other indicators wanted a spankdown which was forecasted, and occurred, but price would likely come up once more on the monthly basis since the MACD still had fuel in the tank to bring price back up.

The SPX rises from the April ashes not due to a healthy positive divergence bottom, but instead due to the rate-cut and Donnie news hype. The crowd goes wild, especially Joe Retail and Carmelita Bagholder buying stocks with their paychecks since the guy on television said everything is going up forever.

The SPX prints a new all-time record high at 6508.23 and new all-time closing high at 6501.86 on 8/28/25. Timmy Trader is passing out "SPX 6.5K" hats but everyone has so many from the other milestones they decline the Made in China caps (a sign of the top as complacency rules the day; everyone expects new highs in stocks to occur forever).

So watch the new Tuesday candlestick that will begin September to verify that all the above analysis remains in play (the indicators must remain negatively diverged and cannot overtake the highs from the start of the year). Even if the RSI should sneak out a slightly higher high compared to the start of the year, it would remain neggie d over the last decade. In other words, that would only delay THE top by a month or two. A jog move would occur down, then back up for THE top as the RSI would then roll over again. For now, the long-term historic top is in for the US stock market and that means the AI bubble is likely popping like the dot-com bubble top.

The selling volume candlesticks from March and April are far higher than the buying candlesticks over the last 4 months so price will want to come back down to look at those prices. The prices on the charts are above their moving average ribbons desperately neeeding a mean reversion lower.

The CPC and CPCE put/call ratios remain in the cellar for the last 3 months, very atypical behavior, verifying the ongoing out of control, over the top, euphoric bullishness, fearlessness that stocks will ever go down, and rampant unbridled complacency. It is going to be spectacular watching it collapse when everybody and his bro is long.

Usually volumes are light after the Labor Day holiday, US markets are closed on Monday, and real trading does not begin in earnest until the second week of September but forget any normalcy in markets these days. You should be glued to your screens every day going forward, especially if long. That way, you will be ready to clench your buttock cheeks as you lose money for yourself and clients.

We may be headed for a soggy September, then a big buy the dip rally to end the month when all think the all-clear has sounded, setting up for a big black crash day in infamous October. You should view the stock market from the understanding that a big black day (Black Tuesday, Black Friday, etc...) can occur any day forward.

The expectation is for the downside to begin in earnest going forward. Three months is long enough to wait for this Godot top. If she slumps and stocks head lower for the next few years, as would be expected, a 3-month top will appear trivial when looking back. The SPX is in this 8% topping range call it 6.0K to 6.5K during this 3-month drama. With all the non-stop hype since April, you would think that we would be over 7K already like many analysts are predicting.

There was a talking head jackass on television the other day that actually used the word "plateau" to describe the current stock market. Pause for laughter. Irving Fisher must be making mischief from his grave, infiltrating that dolt's mind, playing on the human greed that blinded him before the 1929 crash. It is fun stuff. Keybot the Quant is long so when the robot turns negative, that will be a good time for you to start clenching your buttocks.

Plan accordingly folks. Every jackass on Wall Street tells you to buy, buy, buy and hold (because they are selling you their shares as they sneak out the back door). Are you a bagholdin' sucka? Every top needs them. Payback's a Bitch and Johnny Neel can belt that out. 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 Tuesday Morning, 9/2/25, at 5:24 AM EST: The Labor Day party is over but the bullish calls continue. Evercore's Julian Emanuel proclaims that the SPX will increase +20% to 7750 within the next 16 months. That is +1300 points from current levels or a gain of over 81 points per month for every month now through all of next year. He must be smoking some good stuff. Not to be outdone, Morgan Stanley's Mike Wilson signals the all-clear for stocks telling investors to buy, buy, buy (with a SPX 7200 target ahead). The analysts channeling Irving Fisher, that said the stock market is at a permanently high plateau just before the 1929 crash, are Evercore's Emanuel, Morgan Stanley's Wilson, Blackrock's Rieder, Oppenheimer's Stoltzfus, Fundstrat's Lee, Yardeni, CNBC's Cramer, Citi's Chronett, Principal Asset's Shah, Federated Hermes Chiavarone, Oaktree's Marks, Renaissance Macro's deGraaf, and many others, and JPM is telling everyone to buy the dips going forward. It will be an interesting ride ahead since all these folks are telling Americans to buy, buy, buy as the SPX is topping out with negative divergence on the monthly chart. As they say in the Bronx, "good luck wit dat.".

Note Added Wednesday Morning, 9/3/25, at 6:39 AM EST: The bull bravado continues with one internet or television talking head trying to out-forecast the other. TPW's Jay Pelosky expects a performance chase into the end of the year that will catapult stocks higher. Pelosky is especially bullish energy and commodities. HSBC's Max Kettner also professes endless bullish optimism expecting a reacceleration higher for the economy so buy, buy, buy! The stock market wobbles out of the gate yesterday due to the collapse in chips and spike in volatility. These two metrics danced to and fro during the day ending where they started. The tension builds. A lot of bullish investors clenched their buttocks yesterday but by the end of the session they were tripping over each other to buy the dip. Can't Believe We're Here.

Note Added Saturday, 9/6/25: The bulls keep the stock market turd afloat. The all-time S&P 500 high is 6532.65 on 9/5/25 and the all-time closing high is 6502.08 on 9/4/25. The dip-buyers continue supporting the market on any pullback. Chips were goosed to prevent a failure there, for now. The XLF charts are in neggie d like the SPX charts so it looks like the banks will lead the way down. Keybot the Quant identifies XLF 52.50 as the key bull/bear line in the sand that may be in play on Monday. The Fed rate decision is 8 trading days away on 9/17/25. A substantive pullback is overdue so a scenario of stocks dropping from now into the Fed meeting is plausible. Then, on 9/17/25, Powell will provide a thumbs up or down, and stocks will either be stick-saved again, or, will completely collapse. Lots of fun ahead. Banks, chips, copper, commodities, and volatility are steering the stock market ship currently. Copper is in the bear camp but the other four remain in the bull camp. What do you think? Black Monday?.

Note Added Monday Morning, 9/8/25, at 5:00 AM EST: Goldman Sach's David Kostin says the small caps will rally and lead the other indexes to glorious highs again. Everyone is bullish. Bears are as rare as hen's teeth.

Note Added Wednesday, 9/10/25, at 8:00 AM EST: The latest bull cheerleader is Truist Wealth's Keith Lerner that proclaims new stock market highs are confirmed by earnings. He says the stock market is broadening and the bull market will continue with more new highs over the next year. Lerner decrees to 'not bet against AI or the stock market'. You are watching history in the making, folks. The bears are an extinct species. Evercore's Emanuel, Morgan Stanley's Wilson, Blackrock's Rieder, Oppenheimer's Stoltzfus, Fundstrat's Lee, Yardeni, CNBC's Cramer, Citi's Chronett, Principal Asset's Shah, Federated Hermes Chiavarone, Oaktree's Marks, Renaissance Macro's deGraaf, JPM analysts say buy the dips, TPW's Pelosky, HSBC's Kettner, Goldman Sach's Kostin, and Truist Wealth's Lerner continue telling all investors and traders to buy the US stock market with both fists expecting lots of new stock market highs ahead.

Note Added Wednesday, 9/10/25, at 8:00 AM EST: The SPX prints a new all-time record high today at 6555.97, the 6556 palindrome. The all-time closing high is 6512.61 on 9/9/25 and this may be overcome with the SPX currently at 6536. The fun continues. Keybot the Quant remains long while the technicals and sentiment are screaming that a historic top is at hand. Where Have All the Flowers Gone has been changed to Where Have All the Bears Gone?.

Note Added Wednesday, 9/10/25, at 12:38 PM EST: The bull calls continue. Deutsche Bank's permabull Binky Chadha raises the SPX target to 7K. Wheee! Whoopie! Barclay's and Wells Fargo strategists also increase their stock market targets proclaiming that new highs will continue especially after the Oracle happy news about AI orders last evening. Wells Fargo says 6650 is a lock and 7200 next year. No one thinks the stock market can ever go down again. Irving Fisher's ghost can be seen hovering in the background whispering in everyone's ears that the SPX is at a permanently high plateau and will never go lower again.

Note Added Thursday Evening, 11/20/25: The broad stock market sells off for a few days and takes the pipe today with the SPX dropping down to 6538.

Keybot the Quant Turns Bullish

Keystone's trading robot, Keybot the Quant, flipped back to the bull camp yesterday at 10 AM EST at 6448 as Pope Powell brought the tablets down from On High and proclaimed that a rate cut is locked-in for 9/17/25. Equities explode higher on the happy talk that crony capitalism money-printing is right around the corner.

Interestingly, the SPX did not print a new all-time record high or all-time closing high although it would have been easy. Monday and next week will be interesting. Consumer Confidence is Tuesday and the EOM for trading is Friday. The US Labor Day holiday is the following Monday, 9/1/25. Stocks tend to be bullish the two days before a 3-day weekend (Thursday and Friday). The all-important jobs report drops on 9/5/25 that will be another wild day, up or down, for stocks.

Keybot the Quant

SPX S&P 500 2-Hour, Daily, Weekly and Monthly Charts; Overbot; Negative Divergence; Historic Stock Market Top At Hand

Trading is like playing three-dimensional chess only time is the dimension instead of space. Thus, mathematicians say thus a lot, that is why we are never invited to the fun parties, it is a good time to review the SPX 2-hour, daily, weekly and monthly charts to see what the chessboard looks like. Partying is more fun than chess. Million Miles Away.

Starting with the 2-hour, it topped-out with neggie d on Friday's opening bell. You can see price making a matching or higher high, in fact a new all-time record high at 6481.34 on 8/15/25. The all-time closing high is 6473.92 on 8/14/25. Thus, you can assess the chart indicators and lo and behold, they are all negatively diverged (red lines) so you can call the top, and it occurs. The indicators remain weak and bleak so more downside would be expected in the hourly time frame.

In the daily time frame, look at that rising wedge pattern. it is a thing of beauty. It is also a bearish pattern where price would be expected to collapse from. The neggie d on the daily chart will be glad to get that process started, as long as the daily Donnie hype news and non-stop Fed rate cut talk calms. Note the blue circles for the volume candlesticks. Those are distribution days and there was one more set that almost qualified. That is the smart money selling to the dumb money.

The financial managers parade across television and internet screens telling the bagholding suckers to buy, buy, buy! The Uber driver just took an entire paycheck and went triple-leveraged long the SPX because a guy on tv said so. This stuff never gets old. It is fun to watch the animated human greed. Even if a strategist or analyst, sometimes called an anal cyst, opines about stocks becoming frothy, many are buying equities 10 minutes later. Others are pumping and dumping hoping enough sucka's show up to hold the bag at this historic top.

Rick Rieder of Blackrock joins bulls John Stoltzfus at Oppenheimer (SPX 7100 call) and Mike Wilson at Morgan Stanley (SPX 7200 call) all calling for continued upside in stocks. They are all vying for the Irving Fisher award a la 1929 saying a permanent plateau is in place and stocks will only go up from here. Tom Lee of Fundstrat wants in on the action and is calling for SPX 6600 within the next 10 trading days. Ed Yardeni is bullish proclaiming that the "economy is in good shape" and "we are in a melt-up situation." Yardeni calls for SPX 6600+ and his topside target is 6900-7000.

CNBC commentator Jim Cramer decrees that the stock market is not at a dangerous level of froth. Cramer proclaims, "It's a buyer's paradise. Get used to it because it very well may be here to stay." The stuff is comical. Everyone is trying to out-bull each other as the stock market prints a historic top that may stay in place for several years to come. Scott Chronett at Citi calls for SPX 6600+ in the near term and says the "worst case for tariffs is behind us." SPX 7200 is his bull case going forward. What are these folks smoking? That is some good ganga. It makes you see things that are not there. It will be fun to watch. Keystone against the so-called smart Wall Street minds. Who is correct? What camp are you in? There's a better band at Keystone's camp. Hey Jealousy.

The low CPC and CPCE put/call ratios, that have languished with low readings for a couple months, very atypical behavior, indicate rampant complacency, fearlessness and euphoric bullishness signaling a significant top at hand.

So the VST (very short-term; hours) and ST (short-term; days) charts are cooked, how about the weekly (IT; intermediate term)? The SPX weekly chart clearly shows the massive rally off the April low. The stochastics were not positively diverged at the initial April bottom and wanted price to come down once more in the weekly timeframe, and it did a couple weeks later when the stoch's went possie d so we can call that April bottom an acceptable positive divergence bottom (sometimes news hype will start a recovery rather than possie d).

The neggie d top on the weekly was an easy call. Keystone explained all that in February when calling the top. So what about now? Price is negatively diverged across all indicators. The MACD is neggie d from last December but note how this couple-week thrust on Donnie happy talk and Fed rate-cut hopes is trying to eke out a higher high and extend the rally by another week or two. That remains to be seen since the chart is weak. If there is more Donnie and rate cut hype, price may try to tag the upper band and/or at least try to match the all-time high at 6481 but everything is getting long in the tooth. It is time for stocks to receive their smackdown but keep an eye on the MACD line.

On the SPX monthly chart (LT; long-term), this is a very ugly set-up and should scare the Hell out of you if you like to puff your chest out and say you are a long term investor. You are going to get hammered over the next couple years. It is over for the stock market on the long-term basis (months and the next few years). All the chart indicators are in historic negative divergence as price prints record highs. There is no more gas in the tank to take stocks higher on the monthly basis. Not even anymore fumes.

The last four months of buying shows volume candlesticks well under the three months of selling after the late February high. Price needs to come down to take a look at those levels again. If you look at the 2022 bottom the bears were cheated since a proper positive divergence bottom did not occur. Instead, it was hype and the Fed and government printing money like madmen goosing the economy. There is unfinished business down at 3500 so the SPX would be expected to fall to that level and lower over the coming months and couple years. Are you ready for the fun?

The charts in all the SPX timeframes are sick and want price to start dropping going forward. There will be fits and starts but it is very likely that we are now printing a historic top in the US stock market that will not be seen again for some time. Is everyone ready?  Are you following the charts or are you listening to the people above channeling Irving Fisher in 1929 telling you to buy, buy, buy, without a care in the world? Speculators live for these markets. Well, do you feel lucky punk about owning the stock market? Who will laugh last? Funny Way of Laughing. 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 Tuesday Morning, 8/19/25, at 8:04 AM EST: The bulls continue singing from their euphoric and glorious hymn sheets. Cue the organ. Gloria, in excelsis deo. Seema Shah at Principal Asset Mgmt proclaims that the stock market rally will continue into 2026. Shah says stay in AI and tech stocks and do not sell even if they pull back. Steve Chiavarone at Federated Hermes decrees that stock values are justified. It's beautiful. He says it is an early cycle economy and data is accelerating higher. Chiavarone says he is not worried about any bubble in the stock market and will not until the broader market multiple moves a lot higher. Everyone is bullish expecting a far higher stock market telling people to buy the dip even if the market does sell off. What can possibly go wrong?

Note Added Wednesday Evening, 8/20/25, at 9:00 PM EST: Equities stumbled lower out of the gate this morning with JPM immediately telling clients to buy the dip! Traders were tripping over each other to buy, buy, buy, programmed like Pavlov's dog a la classical conditioning. Pachelbel's Canon in D is a classical masterpiece composed during the Baroque period. The Renaissance came before the Baroque period when the great composers thrived. Jeff deGraaf of Renaissance Macro is another buy the dip guy expecting stocks to go higher. Howard Marks at Oaktree says there is nothing really nutty out there going on and "no reason to expect a correction soon." Marks says the current stock market is comparable to 1997 (so the dot-com bubble did not burst for 2-1/2 to 3 years later). Federal Reserve Chairman Greenspan, the lizard king, had the 'irrational exuberance' speech in December 1996 where he warned of toppiness in markets but that continued for 3 more years into the 2000 crash. Marks expects the same so no worries at all. 'Buy the dip' is the standard mantra of stock trading these days. Bears are as rare as hens teeth. Are all of you on the bull boat listening to the lovely siren call of stock buying each day while unknowingly drifting towards Niagara Falls? Stocks recover off the lows during the day. SPX 6396. Keybot the Quant remains short and is tracking the commodities, semiconductors and banksters as the three most important metrics impacting stock market direction currently. Chips failed today causing the flush lower in equities but then recovered allowing stocks to move higher late-day.

Note Added Monday Evening, 8/25/25, at 6:57 PM EST: Stocks ran higher on Friday after Pope Powell proclaimed that rate cuts will begin on 9/17/25 but did not make new al-time highs even though it would have been simple to do so. The upside orgy, however, did not follow through today. If you bring up the SPX weekly chart, you can see that price prints the matching high to begin the new week of trading and the MACD goes neggie d over the last month to match the multi-month neggie d that was already in place for the weekly chart. Nothing has changed at all with the charts above. It should be spectacular when it collapses. Keybot the Quant flipped to the long side on Friday and is tracking chips, banks and commodities as the main drivers of stock market direction currently. Commodities jump higher today so a failure in the stock market will likely begin with the banks and/or semiconductors. King Donnie buys a stake in Intel embracing communism with open arms. It is hilarious. The US government plans to take stakes in private companies; obviously, this is not capitalism, it is crony capitalism filth as the final stage plays out. Dictator Xi will call to congratulate Dictator Trumpski for his move to take over private companies; he told the orange one for the last decade that the authoritarianism and communism in red China is a better system than US crony capitalism. The Tyrants continue to rule. Get well soon, Sam (Fender has trouble with his vocal cords that may hurt his musical career; hope not). Rail against the tyrants now.

Note Added Saturday, 10/11/25: A mini-Black Friday occurs yesterday after King Donnie threatens tariffs on China in retaliation for restrictions on rare earth minerals. The SPX all-time record high is 6764.58 on Thursday, 10/11/25 and all-time closing high is 6753.72 on Wednesday, 10/8/25. The SPX drops to 6553 starting to receive the neggie d slapdown.

CPCE CBOE Put/Call Ratio Daily Chart Indicates Rampant Complacency and Fearlessness Signaling Stock Market Top

Everyone continues partying without a care in the world buying any stock with a heartbeat. Party on Wayne, Party on Garth. However, the CPCE indicates rampant complacency, fearlessness, and euphoric bullishness signaling a stock market top. Get out of the stock market while you still have a chance. 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, 10/11/25: A mini-Black Friday occurs yesterday after King Donnie threatens tariffs on China in retaliation for restrictions on rare earth minerals. The SPX all-time record high is 6764.58 on Thursday, 10/11/25 and all-time closing high is 6753.72 on Wednesday, 10/8/25. The SPX drops to 6553 starting to receive the neggie d slapdown.

BTCUSD Bitcoin Weekly Chart; Overbot; Rising Wedge; Negative Divergence; Upper Band Violation; Price Extended

Bitcoin is cooked; stick a fork in it. Keystone is spouting blasphemy! The charts are the charts, folks, no need to become emotional. Keystone posted the bitcoin chart in early June calling that top (late May early June) but if you went to the can, bitcoin was rallying again before you got back. It was only about a month-long slump that did not amount to much because the King Donnie bitcoin and crypto legislation party was announced.

That is the big upside price candlesticks in late June and as the calendar changed to July. Charts can only price-in all information, including insider information since the stock trade data does not lie (watch what they do not what they say), up to the minute. If new news hits the wires, the charts have to price in the new information. That is the story over the last 6 weeks. Bitcoin was set up to lay an egg but was given a reprieve by the Grifter-in-Chief.

King Donnie is into the meme coin and crypto hype bubble because he and his family are grifting off of it. Even First Lady Melania stoops low having a crypto coin with her namesake. The US devolves from the Biden family grift and lies to the Trump family grift and lies. Such is the crony capitalism system in its last throes.

Anyhoo, the expectation, since the chart was set up to fail in June, is that it will reset negatively once the latest hype news is priced in. Honey, we're home. Bitcoin has arrived back at the top and a multi-week slapdown is on tap for bitcoin going forward.

It is interesting that Keystone's 80/20 Rule plays out again. Price seeks 2's once it prints 8's on the way up and 2's seek 8's on the way down. When bitcoin closed above 80K it opened the door to 120K which occurs. The 118K opened the door to 122K which occurs.

The RSI, stochastics and money flow were all overbot agreeable to a spankdown going forward. The red rising wedge pattern is bearish. The red lines clearly show universal neggie d across all the chart indicators. Sadly, for bitcoin, it is time for Chopin.

Note the volume candlesticks and how the interest in bitcoin has fallen off a cliff over the last year. The volume activity, however, has been consistent over the last 4 or 5 months as traders jockey for position as new crypto legislation is assessed. The two circles show massive distribution weeks over the last 6 weeks. That is the so-called smart bitcoin money cashing-out as they no doubt on television tell the sucka's to buy, buy, buy. Every top needs a bag-holdin' sucka; is it you?

Price has violated the upper band so the middle band at 105K and lower band at 80K, and rising sharply, are on the table. Price is extended above its moving average ribbon so a mean reversion lower is needed.

The ADX verifies that bitcoin is no longer in a strong uptrend. The pink boxes show strong trends higher in bitcoin in early 2024 and again in late 2024 into early 2025 but that was all she wrote. Despite the record price highs, the ADX says the multi-week rally is no longer a strong trend higher.

The Aroon shows 100% of the bitcoin bulls continue believing that bitcoin will go up forever. The red line indicates, humorously, that over 70% of the bitcoin bears also believe bitcoin will go up forever. This is a contrarian indicator that verifies the overhyped euphoric bullishness in bitcoin right now (everyone is on one side of the boat partying like its 1999).

King Donnie already hyped crypto with the new legislation and ideas so there is no expectation that bitcoin would be stick-saved again but the orange one will probably try to keep bitcoin afloat with jawboning once it starts dropping. A multi-week spankdown is about to begin so plan accordingly. She will probably drop to the 80K-100K range over the coming weeks. The all-time record high for bitcoin is 124533 on Thursday, 8/14/25, only 3 days ago.

Well, what do you think? Is Keystone full of sh*t or are you nervous for shoving bitcoin into your pockets over the last month like a greedy fool? You bragged to pretty Emily, the administrative assistant at the office, that you are a bitcoin guru but she laughed in your face proclaiming that she would never go out with a man that did not respect the neggie d on the weekly. Keystone is shorting bitcoin via ETF's as per the chart above. 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 Monday Evening, 8/25/25, at 7:51 PM EST: Bitcoin drops to 109K now at 110K. Bitcoin will likely have a relief rally on the daily basis for a few days but then will roll over again and seek lower prices on the weekly basis (weekly chart indicators are weak and bleak). Keystone's 80/20 Rule says 8's lead to 2's on the way up and 2's to 8's on the way down. Bitcoin breached 112K so 108K is on the table. After that, see if 102K occurs since that will open the door to sub 100K prices targeting 97K-98K and probably lower.

CPI Inflation and GTX Commodities Charts In Sync

The inflation drama continues. Since services inflation has been subdued this year, goods inflation is more important in determining the path forward for overall inflation. The GTX and CRB commodities charts are a reflection of goods inflation and are moving in sync with the CPI inflation data.

Inflation dropped into Last September and then ramped higher into and through the election when King Donnie Trump was placed back on the crony throne. Americans did not want to vote for a cackling communist, or woman for that matter, so the orange one won by default. Inflation continued higher into the start of this year and looked like it would continue higher but alas, it started dropping into springtime as per the GTX chart.

Of course the Bloviator-in-Chief bragged that inflation was falling solely because he was elected and in office. However, inflation bottomed in April and is moving higher ever since. That is why the orange head does not brag about lower inflation anymore except for the occasional lie he or his sycophants try to slip into an interview or conversation. Americans smell bull sh*t because they go to the grocery store every few days and are horrified at the cost of food. At the same time, utility bills run higher because of the AI need for power. No one cared about supplying electricity to poor rural areas but all the stops are pulled out to take care of the AI garbage. Such is crony America.

Anyhoo, the charts are sync showing commodity prices rising and falling and the inflation data agreeing. Wouldn't life be simple, and less stressful for the Federal Reserve, if the trend of the two charts could be followed and the upcoming rate decision for 9/17/25 (two-day meeting 9/16 and 9/17) should be child's play. Rocky Top. All I know is its a pity, life can't be simple again.

Note that commodities ran higher into June corresponding to the CPI but has since stuttered sideways like the drunk last night in Times Square. Commodities are in a sideways choppy funk for the last 2 months and lo and behold, so is inflation.

The green channel shows the GTX dropping over the last month that would automatically make you think the next CPI print will come in at 2.6% a tick lower. However, the sideways blue channels remain in play and price has not broken down yet from that descending triangle pattern since June (a bearish pattern where price usually collapses from but the pattern is sloppy with only 2 baseline touches so it does not hold a lot of weight). 

The thin purple lines move from the lower left to the upper right hinting that the trend in higher commodities prices should continue. It is a wonder that the Fed members are not all bald because they must be pulling their hair out thinking about the cross-currents. GTX (goods inflation) is at a critical juncture so expect fireworks next week. It is testing two key trend lines and almost 3 months of price support. The stakes are high, it is time to bounce or die.

The problem for the Fed is that they will have one more inflation report but it will likely reflect a slight pullback in inflation. That does not mean the inflation worries are over and a downtrend is beginning again. You have to wait to see where the GTX and CRB charts want to go.

GTX is a bit soggy since the June top, with CPI inflation sideways, so that hints that services inflation may be perking up again. This may play out in the next report where goods inflation backs off a smidge, as the right hand of the GTX chart shows, but is negated by slightly rising services inflation (as people, especially the wealthy that raped the country over the last 5 decades, enjoy summer travel and entertainment). In other words, another flat CPI reading at 2.7% may occur and that will not help Chairman Powell and his gang make the rate decision on 9/17/25.

Let's take a look at the GTX charts and see what may be going on. The 2-hour chart appears to be bottoming and wanting to recover higher. The daily chart shows the descending triangle vibe easier and as price slumps, the chart is more agreeable to a sideways move and some buoyancy in price. The stochastics are oversold agreeable to a move higher in the daily timeframe. The weekly chart stutters sideways and the 20-wk MA at 3710 and 50-wk MA at 3675 are moving sideways acting as future support. Price dropped to 3708 testing the 20 with a bounce or die decision and boiiiinnngg, price bounces recovering to 3739 after the first test of this critical support. The monthly chart looks like a continued sideways funk. The CRB weekly chart is more negative with price below its critical moving averages and currently back-kissing the 50 at 295 for a bounce of die decision this week.

What does all that mumbo-jumbo mean? Not much, but the charts hint that the GTX and CRB should experience some buoyancy going forward on the daily basis but remain wedded to the overall sideways funk posture on the weekly basis. If the globe is slipping into worldwide recession, demand will continue falling and will actually pressure prices lower. The Fed should likely weigh the services inflation heavier for the next rate decision.

With a major stock market top occurring as per the rampant complacency, euphoria and neggie d on the SPX charts, the commodities would be expected to fall in sync, and along with the labor recession that is now 2 years along, with a rising unemployment rate (we will see on 9/5/25), a September cut of 25 bips is likely. You would think it is priced into the stock market but equities rally each time Trump or Bessent sneezes and it sounds like they said rate cut.

The goods inflation is predicted by the GTX and CRB charts, however, as fate would dictate, a sideways funk in the chart does not provide clarity. You have to wait and see which side she breaks. The wealthy's consumer spending, that has helped prevent the overall US recession (America has been in a housing, manufacturing and labor recession for 2 years but this negativity is overcome by the wealthy's ongoing consumer spending and the AI-bubble hype), cannot go on forever. After several vacation trips flying to fancy locations, and spa treatments, and buying a $20K refrigerator, and supporting their lazy adult children, and treating themselves to a new Mercedes convertible, the wealthy may tighten the purse strings.

The Fed decision will likely depend on the jobs report in 3 weeks since the inflation data is choppy sideways. If the stock market rolls over in this time period, and it is expected, perhaps the argument will be over a 25 or 50-bip cut come mid-September? 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. 

CPC CBOE Put/Call Ratio Daily Chart Continues Identifying Rampant Complacency and Euphoric Bullishness Signaling Significant Stock Market Top

The stick of stock market dynamite grows longer during this unprecedented top identified by the low put/calls (signaling rampant complacency and euphoric bullishness in the stock market) and negative divergence in the SPX charts. That probably means when she blows it is going to cause serious damage. The fuse only has an inch remaining before igniting the TNT that will blow the stock market to smithereens. Blood and Roses.

Keystone can never recall a time where the stock market did not roll over and die after the low CPC put/call ratios within a couple weeks at least a month. Never. The CPC signaled complacency in May and we are in August still looking for the Godot top. It is a two-month top going on three months. The SPX charts remain negatively diverged agreeable to a significant and historic top occurring right now.

The daily King Donnie happy talk keeps the bulls buying especially the Joe Retail crowd. Also, the constant drum-beat of rate cuts with Treasury Secretary Bessent now calling for a 50-bip cut, and the ongoing AI hype, continue pumping equities higher especially tech stocks allowing the major indexes to eke out new record highs. What, Me Worry? as Alfred E Neuman would say.

It is all systems go for the downside going forward but someone needs to tell the stock market. Do not be surprised if you wake up any morning going forward and your world is rocked if you remain long. 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.

NVDA NVIDIA Monthly Chart; Overbot Rising Wedge; Negative Divergence Developing; Price Extended; Upper Band Violation

The long-term, multi-month, perhaps multi-year, chart for NVDA is setting up with a top due to neggie d. All the Wall Street analysts are telling Joe Sixpack to buy with both hands, as they sell. Volume is Slip Slidin' Away as all-time record highs are printed with Jensen waving the latest AI Reuben sandwich (Rubin) chip in the air. The overbot RSI and stochastics are agreeable to a long-term pullback.

Price is above the moving average ribbon so a mean reversion lower is desperately needed. Price tagged the upper band so the middle band at 121 is on the table and lower band at 63 both moving sharply higher.

When will NVIDIA sing the swan song? Two scenarios. The red lines show negative divergence as price makes the higher highs with the exception of the MACD line that is a hair higher. The month of August has a long way to go, however, so the end points of the chart indicators will adjust for the next 16 trading days (the month is in progress).

Thus, currently, all the indicators want a spankdown to start and continue on the monthly basis except for the MACD that wants another high. Price will falter due to the negativity but only for a month and then it will come back up again to the current highs to place the long-term top when the MACD goes neggie d in September or October.

However, since August has a long way to go, NVDA may drop like a rock and that will drag the MACD line lower to end the month of August that would then show universal neggie d across all the indicators so the long-term top would be in now, this month. Watch that blue circle closely over the next 3 weeks and you will know if NVDA is making its long-term top right now, this month, or if it has some more juice in the MACD tank to bring it back up after a lull and top out in a month or two.

What's that? Your financial manager said to invest in NVDA and hold it for the long-term. Who's your broker? Fred Fafooshinik. Freddie? Keystone saw him yesterday. He was selling NVDA stock and liquidating positions. That makes you the bag holdin' sucka.

Let's take a look at the weekly chart to see if that can help with the timing of the top. The weekly chart is also topping out with neggie d although the move over the last couple weeks had juice. The daily chart is cooked with neggie d. NVIDIA is ready to start retreating now.

The charts are weak so NVDA should be pushed lower going forward and if the MACD line drops below the prior high, she is cooked for many months, say, through the end of the year into the first few months of next year.

Remember, the SPX monthly chart is cooked with neggie d forecasting a long-term top at hand so it makes sense that NVDA is starting to slip on the cliff edge as well. Keystone is not playing NVDA long or short currently but obviously, the play going forward is on the short side staying aware that it is a high momentum stock. 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 Thursday Morning, 8/14/25, at 6:05 AM EST: Let's take a look at everyone's favorite child. The NVDA 2-hour chart is topped out. Ditto the daily in full neggie d. Ditto the weekly chart although that MACD line is trying to keep eking out a bit more strength. This is the top now or within a week or so unless Jensen shows up on stage waving a new chip beyond the Reuben sandwich chip (Rubin). The monthly chart remains as explained above with another 12 trading days remaining in August that may bring the MACD line down and identify this current projected top as a serious long-term multi-month and perhaps multi-year top for NVIDIA. How dare Keystone utter such blasphemy!!

SPX S&P 500 Daily Chart; Tight Bands Project Big Move At Hand

That is a tight band. Counting Crows playing Daylight Fading. No, not that kind of tight band. Tight standard deviation bands (purple arrows). The bands have not been this tight since the 2/19/25 top that resulted in the big drawdown for equities. Tight bands tell you that the move coming is going to be big but they do not tell direction. Keystone always describes it as squeezing a tube of toothpaste; you know it will violently shoot-out of the tube but you have no idea where it will fly. The bands are in tight squeezing price.

You can see that the February top, that Keystone explained at the time, was in full negative divergence so the expectation was down and the tight bands sent the SPX to Hades. It is the same set-up now but there is lots of drama led by King Donnie the three-ring circus showman. The Fed is going political due to the daily Whitehouse intervention. The orange head could not find anyone dumb enough to move their family and life to smelly Washington, DC, for a five-month job replacing Kugler so he gives the position to sycophant Miran that is already living in the swamp and the commute to the Eccles Building is not a long drive. Donnie is sticking his nose in Brazil, India, many countries, telling them how to operate or conduct business.

Trumpski spits on capitalism dictating that American CEO's kneel before his throne daily to kiss the ring and conduct business as the orange head demands. The latest is Donnie decreeing that the Intel CEO resign. And many of you think this is cool? And most of you think capitalism actually exists? That's funny. Capitalism only exists in theoretical business textbooks because of human greed. It's that simple. America is a faux free market crony capitalism financial system, corrupt to the core, in its last throes. Get with the program.

There was no reason for price to come back up in the daily time frame since the neggie d was universal when the top was placed a week ago. Nevertheless, the SPX rises for five days and fills the gap above that is a good thing for bears as previously mentioned.

Note that the bounce in price was not due to the set-up of positive divergence. The few-day rally is purely due to news and happy Donnie talk and rate-cut expectations. You would think rate cuts have long since been priced into the stock market but there is buoyancy in equities when Chairman Powell coughs and it sounds like he said rate cut.

Further, the stochastics were weak and bleak after the SPX bottom wanting price to make lower lows not move higher. Look at the MACD line. Comically, it is still going lower despite the multi-day comeback move. The expectation would be for failure and a squeeze lower in equities. Watch to see if the RSI, stochastics and money flow go sub 50% into bear territory. Can the orange head muster up more happy talk or is it all sounding like a bunch of bull sh*t?

Well, what do you think? Black Friday? Black Monday? Friday, I'm In Love. 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.

SPX S&P 500 60-Minute Chart with 200 EMA Cross

One of Keystone's standard short-term signals is the SPX 60-minute with 200 EMA cross. Say what? What is this odd language he speaks? Tell this guy to speak English. You can see last Friday how the bottom fell out after the job report, gapping down and violating the 200 EMA at 6255 opening the door to a short-term bear market going forward.

Alas, the bulls eat their spinach and come to play Monday morning with the SPX gapping-up with a dip-buying orgy so obscene it would make Caligula blush. Traders were buying any stock with a heartbeat and the bulls win back control of the stock market with price back above the 200 EMA at 6255.

The SPX sits at 6299 so bears need 44 points and more of downside to show that they mean business. The bears should be thankful for the recovery move since it filled the orange gap from Friday morning. This buttons-up the topside and allows price to move steadily lower from here without worries about having to move higher to fill a gap. The gap from Monday will want to be filled and that would take place if/when price goes down for another test of the 200 EMA at 6255.

The 20-day MA is 6311 and price plays to and fro along this important moving average the last couple days. Thus, putting it all together, the 6299 price is below the 20 so the door is open for the SPX to drop and fill the lower gap and retest the critical 200 EMA at 6255. This behavior will dictate if a short-term bear market is locked-in going forward, or not.

If the SPX recovers back above 6311, the bulls will stick a thumb, er hoof, into the bears eye and not worry about any downside ahead. If 6255 fails, stocks will be falling like rocks. Are we going back to Rockville? Don't Go Back To Rockville. 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.

SPX S&P 500 Daily, Weekly and Monthly Charts; Negative Divergence; Overbot; Rising Wedge; Historic AI Bubble Stock Market Top

The SPX begins receiving the negative divergence spankdown. Divergences are the most powerful force in stock trading both neggie d and possie d. The SPX charts are toast. Trading is like playing multi-dimensional chess but time instead of space are the dimensions. As seen above, the stock market is sh*tting the bed in the daily, weekly and monthly timeframes. That is ugly.

A rising wedge pattern appears on the daily chart a bearish pattern. Stocks made the new record high at 6427.02 on Thursday, 7/31/25, then began puking its guts out receiving the neggie d smackdown. All the chart indicators are in negative divergence (red lines) as price made the new highs so the SPX was on borrowed time and it receives a slap to the face, like Keystone when he was fresh with Missy many years ago.

The standard deviation bands are pulling in tight on the daily which places force behind the move. Since it has already dropped towards the bottom band, a move to touch the 6196 would be in order. The blue circles show 9 distribution days during June and July. That is the smart money sloughing off shares to the dumb money such as Joe Sixpack, Juanita Retail, Carlos Bagholder, Frank Fool and Carmelita Sucka (the selling volume candlestick is higher than the buying volume candlestick the day before; the sucka's get bulled-up on hype and run in after an up day to buy the market and that is when the institutions distribute shares to these suckers and bagholders).

The indicators on the daily chart remain weak and bleak wanting to see lower lows in price on the daily basis. The RSI slips below 50% into bear territory saying goodbye to the joy since April. Watch the stochastics to see if they do the same that will tell you more weakness ahead on the daily basis.

On the weekly chart, same dealio with the neggie d; it is universal across all chart indicators and the multi-week spankdown begins. The weekly chart is showing neggie d not only across the last year but also for the last two weeks as the stock market prints the highest number in history. It is a piece of crap. A multi-week pullback begins.

On the monthly chart, same dealio with the negative divergence; it is universal across all chart indicators and the multi-month spankdown begins. This is the chart that tells you the stock market is in serious trouble and likely printed an epic top like the dot-com bubble top in 1999-2000, and Greenspan's real estate bubble top and Great Recession in 2008-2009. It is the 2025 Artificial Intelligence bubble top but that does not have a ring to it; let's call it the AI bubble top (even though stocks were also pushed up for many years by the Fed's money-printing that rewarded the wealthy class with higher stock prices for doing nothing; it is called crony capitalism filth that is in its last throes; the 30 million Americans, that screwed the other 300 million over the last 5 decades, are still spending money, having a great time, their consumer spending is helping the economy avoid a recession, so far).

There is no hope for stocks, folks. Massive good news would be needed to turn things around. Recent tariff announcements are met with yawns. That is what King Donnie gets for overexposure of his orange puss each day. You would get sick of your favorite song if you played it 114 times in a row, right? Donnie is the reality television show president and each day is a new episode so he has to get on camera and spew a bunch of stuff to keep the audience's attention and keep the hype going. That schtick gets old and Americans are worried about the plot twists ahead for the next 3 years as his reality television show continues and the tv cannot be turned off.

The daily chart wants to continue lower for a few days. Watch for positive divergence to develop and you can call the bottom when it occurs. The weekly chart, however, remains weak and bleak, so after the daily chart would recover for a few days, it will roll back over and die again. Watch for positive divergence to develop on the weekly chart and you can call that bottom when it occurs probably later this month or in September. However, the monthly chart is weak and bleak calling for many months of downside if not at least a year or two, so after the weekly chart tries to recover off its possie d bottom, say in September and October, it should roll over again to honor the weakness in the monthly timeframe ahead. It is likely that stocks will trail lower, with fits and starts, through the end of the year and into 2026.

The Sunday night futures and Monday trading will be interesting to see if there is strong follow-thru, or weak follow-thru, or a reversal with the bulls fighting back. King Donnie will likely announce some happy talk and happy news about 4 PM EST today two hours before the S&P futures open to try and start the week off on an upbeat note. Instead of hearing happy D and C chords, he may be greeted with sad Em and Am chords. Will the bulls exclaim, "I don't like Monday's?" Boomtown Rats.

Keybot the Quant flipped short on Wednesday after the copper collapse and then the drop in retail stocks and banks on Friday sent equities off the cliff. Bulls have zero hope if they cannot retake XRT 78.03 and XLF 51.67 so watch these lines in the sand closely. 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.

The Keystone Speculator's Unemployment Rate Chart; US Labor Recession is 23 Months Along and Counting

THE UNITED STATES LABOR RECESSION STARTED ON 9/8/23 AND IS 23 MONTHS ALONG AND COUNTING; NEXT MONTH IT WILL BE 2 YEARS!!

The country also remains in a housing recession and manufacturing recession (manufacturing lost another 11K jobs in the latest report) in addition to the labor recession but an overall US recession continues vacationing with Godot (it is nowhere in sight). The Godot Recession (the recession that never arrives) occurs because consumer spending by the wealthy Americans, that benefited from 15 years of Fed money-printing, remains robust. Also, the AI (artificial intelligence) hype and excitement delays the onset of the overall US recession.

How can this be? For many decades, if America is in a labor, housing and manufacturing recessions, than it is guaranteed to be in an overall US economic recession. Not anymore, buckaroo. Semiconductors are the new sheriff in town and that sector has gone great guns higher. Further, the AI hype sends stocks to the moon. The easy money provided by the Fed and Congress during the COVID-19 pandemic creates inflation and jobs galore. People cannot spend the free money fast enough. Employers begged for workers during 2022 and 2023 and into 2024 but not so much anymore in 2025. People that are losing their jobs nowadays are saying it is very difficult to find another job.

Companies and businesses know who they plan on sh*t-canning (layoffs) but are holding off a bit longer to see how the Donnie Trump Trade and Tariff War unfolds, or unravels.

Trump buckled and backpedaled on his tariff threats in April to prevent the stock market from falling further and more importantly, foreigners were losing confidence in the all-mighty US dollar and in treasuries (TACO; Trump Always Chickens Out). The orange head proclaimed a 90-day period for tariff talks, that then was extended to 8/1/25. 

For the 8/1/25 jobs report, a paltry 73K jobs are reported but the big news was that the two months of prior revisions were taken down by 258K jobs painting a sick labor market picture for the last three months. The unemployment rate, the Fed's key stat, moves higher from 4.1% to 4.2%. Most of the jobs were in the healthcare sector.

King Donnie does not like the jobs numbers that indicate a lackluster economy so he shoots the messenger. King Cry-Baby calls for the firing of the BLS Commissioner Erika McEntarfer. It is concerning that the orange baby would go ballistic so fast over data and make a quick irrational decision in a few minutes time. You would rather see a man with a calmer mind making decisions instead of a petulant adolescent that did not get his way. No wonder his approval rating is slipping.

The unemployment rate is for all the marbles. In the spring and at the last Fed meeting, Chairman Powell could not have been clearer about focusing on the unemployment rate. The Fed will not act to lower interest rates unless the US unemployment rate moves above 4.4%. This was the thinking from springtime but considering the daily pressure that Trumpski applies to Powell's thin shoulders, any number at or above 4.3% will likely cause the Fed to begin a rate-cut path.

The worry, however, is stagflation. The 1970's was a great decade for music, like Zep and Rock and Roll, it feels like yesterday, but the stagflation was killer and doomed President Jimmy Carter, who is often ridiculed in the media as a horrible president, but he was the last president that actually cared about common Americans. In the 70's, jobs were scarce and if you worked it was for peanuts. At the same time, prices went up and up; stagflation. This is likely our fate in 2025 and going forward.

A cash society was rampant in the 70's to avoid paying tax on items and services (this is why central banks in 2025 want a CBDC, central band digital currency, so they can make sure you pay every dime of tax while also controlling your life). The division between the have's and have-not's, the rich and poor, in America currently is the widest it has been since the 1970's when a routine mantra spoken by common folks was, "F#*% the rich." Let the modern-day class-war begin.

The Fed's mandate is price stability and maintaining low unemployment but what do you do when both are going in the wrong direction (joblessness increasing while inflation increases)? The Fed cannot cut rates to help with the housing and job markets if inflation runs higher due to the Donnie Trump Trade and Tariff War. Comically, the guy creating the inflation with his tariffs, King Donnie, is yelling at Powell to cut rates.

The Fed is likely less concerned about inflation on the margins and more concerned about growth and jobs thinking that the 4.3% or 4.4% and higher unemployment rate is the trigger-point to cut rates. 

The stage is set for the 9/5/25 jobs report. Will Donnie pull more jackass stuff and fire the new BLS head of statistics if he does not like the numbers again? Comically, his orange head will turn red going forward when the employment numbers start printing negative numbers. The current unemployment rate is 4.2% on the verge of 4.3%. The actual number is 4.248%. All of you remember high school math class and rounding numbers, right? If the rate was only 0.002 higher, that is two-one thousandths, it would have been 4.25 and rounded-up to a 4.3% rate. Put that in your pipe and smoke it.

The unemployment rate tagged 4.3% on 8/2/24, one year ago, and it looked like it was going to take off higher but alas, it fell back down and has bumped along in that sideways channel ever since. If the rate tags 4.3% and higher on 9/5/25, the Fed will likely cut in September and little baby Donnie will be happy.

Note how the rate has come down to touch the signal line four times over the last 23 months but the labor recession remains in play and now the blue line is again moving up and away making the 9/5/25 numbers even more important. When the unemployment rate moves higher, it is typically not gradual, instead it pops up strongly and that is what Powell and the Fed are worried about. It will likely pop higher in the next report.

Projecting the data forward, if the unemployment rate pops to 4.3% or 4.4% or higher, a big jump from the current 4.2%, bells, horns and whistles will sound at the Eccles Building. The Fed will be open to rate cuts starting in September so King Donnie will be happy for the bad news. If the rate remains at 4.2% or if it dips to 4.1%, the labor recession remains in play although it will be teetering on recovery and a happier jobs picture ahead. If the rate drops to 4.0%, that will signal a labor recovery and the end of the near 2-year labor recession (unlikely outcome).

Eastman Chemical reported disappointing results. Do you remember naughty Mrs Robinson? In the movie, Ben was told one important word, "Plastics." One of Keystone's many hats is a chemical engineer and when the chemical companies flounder, you got problems. The chemicals, resins, paints and other goodies in those tanks are the building blocks of the entire economy.

Fed Governors Waller and Bowman dissented against the Fed decision to remain on hold with rates. The two favor a rate cut now. Both are concerned about the labor data and are puffing their chests out after the jobs data yesterday. Waller is criticized for auditioning for the chairman job if Powell leaves before his term ends in May. Waller says the labor market is showing signs of weakening and the wait and see approach is too cautious of a posture (so a rate cut cycle should begin now). Bowman says she is worried about a deterioration in the labor market and prefers taking a proactive approach (and cutting rates now and going forward).

Now you have the full story folks. Get your popcorn ready for 9/5/25 circus. If you listen closely, you can hear the ongoing Trump administration calliope music in the background.