WTIC West Texas Intermediate Crude Oil Weekly Chart and COT (Commitments of Traders) CL Oil Chart

Oil maintains its rally and buoyancy in recent weeks but logs a negative week last week. The red lines show a rising wedge pattern (bearish), overbot stochastics and negative divergence with the indicators sans the MACD. The initial spank down started last week due to the neggie d, however, the MACD line wants price to come back up one more time for a matching or higher high after the initial pull back. Since a pull back occurred last week, price may come up for the higher high early this week and at that time the MACD has to be monitored. Oil will not roll over until the MACD rolls over with negative divergence (as price moves higher). Oil may favor the 38-52 sideways range for the remainder of the year.

The COT chart displays the bottoms in oil prices with the green circles and tops with red circles. On an overall relative basis, the red bars are very low on the chart and the blue bars very high indicating that price is likely topping currently. Price will likely have to retreat into the green bubbles in the right margin which would correspond to lower oil prices.

The projection would be for a pullback in prices for a week or two, then price will come back up again to current levels, at that time, if the MACD turns neggie d and joins the other indicators, the top is in for oil on the weekly basis and more down is ahead. With the Fed rate decision on tap on 6/15/16, markets may play coy and wait for the reaction in the US dollar that will send commodities in the opposite direction.

Oil appears to be topping and will either continue lower from here for a week or two, followed by a recovery for a week or two, then likely roll over for extended down, or, recover now and play around at the 50-52 area as the MACD flattens and rolls over which will then roll oil price over to the downside. Keystone has no position in oil currently and is not interested until the MACD goes neggie d since that would make the short side an attractive trade. 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: COT charts are courtesy of COT Price Charts an excellent resource and annotated by Keystone.

May Publication of the Daily Chronology of Global Markets and World Economics is Available from Amazon; 1-Year Anniversary of Stock Market Top; Sick European Banks; Puerto Rico Default; Venezuela on the Brink; Paris Riots; Zika Virus; "Bremain" Rally

The May publication of the Daily Chronology of Global Markets and World Economics 2016-05 is available through Amazon (AMZN). The epic market action continues. The global stock markets begin the year by crashing and collapsing into 2/11/16 followed by a huge recovery rally to present. The prior monthly chronologies explain the huge crash from late December into mid-February and the subsequent recovery from February to present.

Italian, Spanish and Portuguese banks remain a major problem in 2016. The business news media ignores this topic that may lead to serious trouble in financial markets and create global contagion.

The US POTUS primary elections continue with Clinton the likely democrat nominee. Clinton may be undone by the ongoing email scandal. On the republican side, Trump takes the nomination but is not doing well in national polls. The conventions are in July and the general election for the next US president is 11/8/16. Americans are unhappy faced with a choice between an orange-headed clown that bloviates daily and a scandal-ridden liar incapable of telling the truth.

Central bankers such as the Fed, ECB, BOJ and PBOC keep pumping stocks higher. The chronology explains how the central bankers are the market. The oil rally continues as the US dollar index drops to the bottom of a key long-term range.

A stock market rally occurred in May when the "Bremain" camp started leading in the UK polls over the "Brexit" camp, however, a lot can happen before the 6/23/16 Brexit referendum.

Japan is in turmoil. The BOJ has taken rates negative and they print record negative lows. The dollar/yen pair is sliding lower (stronger yen) causing problems for BOJ Governor Kuroda that is trying to weaken the yen.

Puerto Rico defaults on a bond payment with a huge $2 billion payment due on 7/1/16. The US Congress is working on a bailout solution but in a difficult place since troubled cities in the US will want the same bailout deal offered to Puerto Rico. The clock is ticking and a plan must be in place for Puerto Rico within the next three weeks.

President Dilma Rousseff is impeached and temporarily ousted from office; her appeals will continue. Venezuela is in economic and political collapse. The 2016 Summer Olympics are approaching quickly and will be held in Brazil; ground zero for the Zika Virus.

The month of May was the one-year anniversary of the stock market top in May 2015. Interestingly, markets topped in October 2007 and it was about one year later when US stocks collapsed in October 2008 through March 2009 when QE1 saved the stock market (to benefit the wealthy) and stabbed capitalism in the heart. Will that fractal repeat? The US stock rally off the 2/11/16 bottom continues.

The chronology describes the reactions to economic data such as the Monthly Jobs Reports in real-time. Friday, 6/3/16, was a circus with a paltry 38K jobs report which is described in detail  in the May chronology as it occurred (the May publication runs through 6/4/16). There is no other document available on the world wide web that records the action in real-time with such detail. Inflation, that the Federal Reserve has tried to create for seven years with their obscene Keynesian programs, cannot exist without wage inflation occurring so each jobs report is very important.

The chronology explains the reaction in stocks, bonds and currencies to key events and economic data releases. If you are trying to make sense of the markets this is the resource for you. No other publication exists in this format where the stock, bond and currency moves are provided and explained as world events take place in real-time.

The chronology records economic history preventing revisionist tampering in future years. Many of the same asset managers telling everyone to go long the market in 2007-2008 repeated the same mantra through 2015. The stock market topped in May 2015 placing anyone that listened to television pundits over the last couple years underwater on their long trades and losing money.

Analyst and strategist quotes and words are recorded in the chronology so credit or disdain can be handed out in the future. If a multi-year top has printed, the chronology serves as the most accurate accounting of the stock market topping process ever recorded in economic and market history. The chronology is the most reliable and easy to understand source for explaining global markets. The chronology is very easy to read and avoids using fancy ten-dollar college words.

As always, all monthly publications of the Daily Chronology of Global Markets and World Economics are available from the links in the margins or simply searching on Amazon or Google. The monthly publication contains updated information not posted on this web site as well as clarifications, edits and refinements to the ongoing daily blog text.

We are living through historic stock market and economic times. The daily chronology is the most accurate accounting on how the stock market tops and bottoms occur in real-time. The monthly publications are compatible with any electronic device and include an extensive Business Acronym List and Ticker Symbol List. The Acronym List is the most comprehensive business-related acronym list available on the internet. The chronology is not available in hard copy and only distributed around the world electronically.

Download this valuable resource today. Remember to support the KE Stone Series of blogs (Keystone the Scribe, The Keystone Speculator and Keybot the Quant) through donations, the daily chronology book sales and honoring advertisers that support the original free content provided in the blogs. The blog proceeds aid charities.

The free blog content is posted in proportion to the advertising, book and donation income received. Thus, you folks working at the large money-center banks around the world need to open your wallets if you want this unique trading and economic information, that is not available elsewhere, to continue. Let some moths out of those wallets.

The KE Stone Series of blogs are viewed by 100's of thousands of people around the globe each month including money managers, investors, students, traders, historians, economists, teachers, current event enthusiasts, hedge fund managers, political junkies and folks that truly want to understand how the world's economic systems and markets function. All readers should support the blogs to expand the information provided.

UTIL Utilities Weekly Chart Prints Record High Negative Divergence

The utilities are watched closely, especially by the old-timer's, for market directional clues. The weekly trend in utes based on looking back 15 weeks ago, and, the 50-week MA now at 601, are two key metrics when assessing the utilities weekly chart. Utes remain in a weekly uptrend since the weekly closing high remains above the high from 15 weeks ago. As the coming weeks play out, this upward trend will be tested. Counting back 15 weeks, UTIL is at 619 (pink line) so this level is key for the week ahead, then the next week, the lookback number is the blue line at 633, then the next week is 647. So UTIL may not drop to 619 this week, however, for the week of 6/13, perhaps price will fall under 633, or, for the week of 6/20, price may drop under 647. Utilities will become more important going forward.

The 50-week MA is at 601 way under the price at 672. Big trouble would be on tap for markets if the 50-week is lost; it would have a trap-door effect on the stock market. For now, however, the bulls are happy setting a new all-time record high for UTIL at 675.46. Strike up the band. Hand out the party hats. The brown W pattern bottom formed between 540 and 605, a 65-point difference, so once the breakout occurs early this year, the target is 670 (605+65) which is now achieved satisfying the W pattern.

The volume circles show distribution taking place with large sell weeks following an up week. This is the so-called smart money handing off their shares to the bag-holding suckers. Joe Sixpack reads a financial book he found at the Thrift Shop down the street and proclaims himself an instant expert i financial matters. He tells all who will listen to buy utilities as a safe defensive place to park money and you also earn a dividend while you wait. However, throw out that old playbook.

Economic and business cycles are torn asunder by the obscene Keynesian monetary polices of the Federal Reserve and other global central bankers. The Fed has twisted markets into knots; no one really knows the true value of anything anymore after all asset classes have been artificially pumped higher for over seven years. Ma and Pa Kettle, Aunt Edna, the doorman and Joe have all taken their life savings and placed it into utilities. They will likely have their heads handed to them in the weeks ahead.

Price is a higher high and the red lines show universal negative divergence across all indicators. It is a very weak record high. The MACD line cross is negative; keep an eye on this over the next couple weeks. Utilities have been moving choppy sideways for the last three months. The expectation would be for utilities to receive a neggie d spankdown over the next week or so, then some recovery due to the sideways nature of the indicators over the last month, and then likely a roll over to the downside. If price keeps sneaking out further highs, watch the thin red lines shown through the right margin; if the indicators remain under these thin red lines negative divergence remains, and this would only lock in the downside going forward.

The monthly chart indicators are not excited about the record high print either and is open and agreeable to softness in price ahead. The projection would be for UTIL to top at this 670-680 level in the coming days and pull back perhaps to 650-ish, then perhaps a little bounce then roll over. So utes would be expected to top out anytime ahead say in this June-July time frame on this weekly basis.

If utilities move lower, that is a bad sign for stocks which will move lower at the same time, or top out within 8 weeks and follow utes lower. Watch those 15-week lookback numbers above because that will tell you that trouble is on the way, or not.

The neggie d indicates that utes should receive a spankdown very soon. Keystone has no position in utilities currently but is considering a long in SDP, which is a 2x inverse short against utilities (SDP goes up if utilities go down) but the ETF is thinly traded and a dangerous leveraged play that is very speculative. As would be expected, SDP displays attractive positive divergence and oversold conditions the mirror image of the UTIL and XLU charts. XLU would be under consideration as a short. Utes gapped higher last week so it is likely best to let any near-term momo play out for a couple days. For the weeks ahead, start paying attention to utes. 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.

US Monthly Jobs Report a Paltry 38K Jobs

Markets are reacting to the Monthly Jobs Reports a paltry 38K jobs. As always, Keystone the Scribe provides the daily detailed chronology of the market moves and explains why they occur. Below is an abbreviated version of today's drama:

At 8:15 AM EST (1:15 PM London; 2:15 PM Frankfurt), analysts are expecting 158K jobs with a 4.9% unemployment rate for the Monthly Jobs Report. A 4-handle on the rate will receive attention. Last month was a gain of 160K jobs with a 5.0% unemployment rate. The VZ strike was occurring in full force last month with thousands of telecom workers not counted on the employment ranks so it is a mystery how Verizon will impact the jobs number. Private Payrolls are expected at 150K jobs versus last month’s 171K.

Average hourly earnings, perhaps more important than the headline job and rate numbers, is expected at +0.2% month-on-month compared to last month’s +0.3%. Inflation, that the Federal Reserve has tried to create for over seven years with obscene Keynesian money printing, cannot exist without wage inflation. The Fed will not hike rates if the wage data is weak. If wages come in at +0.2% and higher, then the door remains open for a June or July rate hike.

The Average Workweek is expected to come in at 34.5 hours matching the prior month. The Labor Participation Rate is 62.8%, at multi-decade lows, and will be monitored for any change. The United States needs to get back to work after a seven-year lull which would be reflective in the labor participation moving higher. The tension increases as the numbers hit the news wires.

S&P +1. Dow +20. Nasdaq flat. DAX +0.5%. CAC +0.5%. FTSE +0.9%. Euro 1.1156. Dollar/yen 108.79. Pound 1.443. WTIC 48.90. Brent 49.81. Gold 1216.

At 8:30 AM EST (1:30 PM London; 2:30 PM Frankfurt; 8:30 PM Hong Kong; 9:30 PM Tokyo), the Monthly Jobs Report drops a bomb on Wall Street. Boom. Jobs increase by only a paltry 38K. Market participants are in shock. Jaws drop. The unemployment rate collapses to 4.7%. The very important Average Hourly Wages are steady at +0.2%.

The 38K jobs are the lowest number since September 2010. The low unemployment rate is at lows not seen since November 2007 one month after the major top printed in the stock market. The revisions are disappointing with Mach and April down 59K jobs. March jobs are cut from the original 208K number to 186K and April is reduced from 160K down to 123K jobs. The 2-handles are disappearing on the jobs numbers and the monthly job gains can now barely keep up with new entries into the work force. The three-month moving average for jobs drops to 116K jobs. Why would President Obama be bragging about the economy like he did this week? Private sector payrolls are up a tiny 25K jobs.

Job losses are broad-based. 34K jobs are lost in the Information component which is the effect from the Verizon strike. 15K jobs are lost in construction. 10K jobs are lost in mining. 18K jobs are lost in manufacturing. Temporary help loses 21K workers. It is a sorry state of affairs if companies are not hiring temporary workers; it indicates that the backlogs are weak and the economy remains sluggish and lackluster.

Job victories occur in the healthcare sector gaining 46K jobs. People must be worrying themselves sick these days. Business and professional services gain 10K workers. People must be looking for a jobs. Food and drink jobs increase by 22K. People must be drinking their troubles away.

The Labor Participation Rate is 62.6% dropping -0.2% month on month. This is sad. Less and less people are working. They want to work; there are simply no jobs. The labor participation is the lowest since the 1970’s.

30 years ago in the States, it was odd to see a man in a department store during daytime hours Monday through Friday since most men had full time jobs. Walk into a WMT, TGT or any other store in 2016, and there are as many men as women if not more. America desperately needs to get back to work. Republican POTUS nominee Trump receives much of his popularity from people that want to go back to work. The President Obama years have been very tough on the middle class and poor that deal with many years of long-term structural unemployment. The U-6 rate is steady at 9.7%. The Average Workweek is 34.4 hours in line with the revised-lower 34.4 hours from last month.

At 8:32 AM EST, S&P -7. Dow -45. Nasdaq -14. WTIC oil 49.16. Brent oil 50.13. Market participants are in shock. The low headline jobs number is jaw-dropping. It will be interesting to hear the Whitehouse spin on the paltry result. The 4-handle on the unemployment rate is stunning. A low rate should be met with euphoria and joy; instead it receives disdain since many Americans are simply not counted anymore even though they remain out of work. The prior revisions that are adjusted lower is a very negative development since trends occur over multiple months and March and April was just punched in the face.

At 8:33 AM EST, the USD drops to 94.83 on less chance of a Fed rate hike. The drop in the dollar sends commodities higher including gold. Fed Funds futures forecasting the rate hikes plummet. The chance for a June Fed hike is down to 4% from the 22% earlier this morning and 34% only a couple days ago. Comically, the chance for a June hike was 4% about six weeks ago and then ran up to 34% after the Federal Reserve members kept jawboning a hike; now the chances have made a round trip back to a near-zero chance of a June hike.

Fed Funds futures indicate only a 38% chance of a July hike, 49% for September, 52% for November, 68% for December and 71% chance for February 2017. There is not even a 50% chance of a Fed hike until November and market participants do not expect the Federal Reserve to hike the key rate until 2017. This is a major disconnect from the Fed that keeps threatening a June or July hike.

S&P -5. Dow -34. Nasdaq -10. DAX -0.3%. CAC -0.1%. FTSE +0.6%. WTIC 49.09. Brent 50.03. Natty 2.42.

S&P -7. Dow -50. Nasdaq -13. USD 94.67. The euro is above 1.12 to 1.1259 as the US dollar weakens. The dollar/yen pair is under 108 to 107.81 as the dollar weakens and the yen strengthens. Pound 1.452. The US 2-year yield is 0.807%.

At 8:35 AM, S&P -8. Dow -52. Nasdaq -13. US Treasury yields are; 2-year 0.799%, 5-year 1.265%, 10-year 1.737%, 30-year 2.543%.

At 8:38 AM, S&P -8. Dow -48. Nasdaq -12. Euro 1.1253. Dollar/yen 107.90. Pound 1.4494. Gold catapults +1.8% higher on the lower dollar to 1235. Silver is up +2.1% to 16.37. Copper is up +2.9% to 2.13.

At 8:40 AM, S&P -6. Dow -40. Nasdaq -10. DAX -0.2%. CAC -0.1%. FTSE +0.6%. WTIC oil 48.98. Brent oil 49.92.

The smoke is clearing and the dust is settling after the bombshell jobs report. Shell-shocked traders are trying to make sense of the surprising data and assess the impact to markets going forward. S&P -10. Dow -65. Nasdaq -16.

At 9:05 AM EST, S&P -8. Dow -61. Nasdaq -16. DAX -0.4%. CAC -0.5%. FTSE +0.4%. Euro 1.1297 near 1.13. Dollar/yen 107.59. Pound 1.453.

WTIC 49.03. Brent 49.91. Gold is up 27 dollars, +2.3%, to 1240. Silver is up +2.4% to 16.41.

Treasury yields are; 2-year 0.78%, 5-year 1.24%, 10-year 1.72%, 30-year 2.53%. German bund 0.074%. Japan 10-year yield -0.109%.

The banks are slapped in the pre-market. BAC -2.7%. C -2.8%. JPM -2.1%. WFC -1.6%. Department Store Macy’s is sold off; M -0.7%.

International Trade data shows the trade deficit narrower than expected at -$37.4 billion. Exports are up +1.5%. Industrial supplies and auto sectors are strong. Imports gain +2.1%. Capital goods orders are increasing which is encouraging for the economy.

The new moon peaks for the month tomorrow, Saturday, 6/4/16, at 10:59 PM EST. Stocks are typically bearish moving through the new moon each month. The next three days are the darkest overnight periods of the month so military operations may increase by the forces that employ superior night vision technology.

Investors Intelligence survey indicates elevated bullish levels at 45.4% and reduced bearish levels at 23.7%. Sentiment is typically a contrarian indicator. Traders are very bullish on the stock market currently. The bullish sentiment is further verified by the low volatility (VIX) and low put/call ratio (CPCE). Complacency hints that markets are toppy in the near-term and may need to pull back for a rest.

At 9:30 AM EST, US stocks collapse lower out of the gate. Banks are smacked hard. XLF -1.6%. BAC -3.6%. C -4%. JPM -2.7%. WFC -2.2%. The healthcare sector trades lower despite creating the most jobs; XLV -0.5%.

Utilities are a winner with XLU up +1.3%. Chips are generally elevated from the Ambarella and Broadcom joy last evening. AMBA +5.6%. AVGO +6.8%. SOX +0.7%. SMH +0.5%. XSD -0.2%. INTC -0.3%. NXPI -0.4%. MU -1.5%. Consumer staples are higher as shown by XLP gaining +0.2%. Investors are flocking into utilities and staples for safety and a dividend but they are likely only covering themselves with a fig leaf. Consumer discretionary stocks are lower. XLY -0.6%. Energy stocks are positive.

At 9:39 AM EST, the S&P 500 is down 10 points, -0.5%, to 2095. The Dow Jones Industrials are down 91 points, -0.5%, to 17747. The Nasdaq Composite is down 26 points, -0.5%, to 4946. The Russell 2000 small caps are down 5 points, -0.5%, to 1165. The four major indexes are each uniformly down -0.5% indicating that the bulk of the trading, over 80% of the trading transactions, are occurring by programmed algorithms and robots. VIX 14.17.

Euro 1.1315. Dollar/yen may print a 106-handle now at 107.05. BOJ Governor Kuroda is drinking sake trying to drown his troubles as the yen strengthens. Japanese stocks will be hammered come Monday if the trend remains. Pound 1.4562. Oil is down -0.4% on the session despite the weaker dollar. WTIC 48.92. Brent 49.76.

15 minutes into trading, the PMI Services Index is 51.3 below the prior 52.8 but remaining in expansion. In-flight connectivity and wireless provider GOGO crashes -13%. VIX 14.23.

The banks are ill. The large money center banks and the regionals are beaten. XLF -2.2%. BKX -3.8%. KRE -3.5%. C -4.5%. BAC -4.4%. KEY -3.7%. MS -3.6%. USB -2.7%. ZION -3.2%. RF -4.7%. Steel and materials stocks fell love. MT +2.7%. AKS +4%. X +4%. FCX +5%. VALE +5.8%. CLF +3.9%.

The SPX is down 13 points to 2092. The Dow is down 106 points, Nasdaq down 37 points and the RUT loses 8 points. VIX 14.30. Euro 1.1311. Dollar/yen 107.17. Pound 1.4553. USD 94.25. WTIC 48.98. Brent 49.81. Natty 2.42. Gold 1243. Silver 16.42. Copper 2.111.

US Treasury yields are; 2-year 0.79%, 5-year 1.24%, 10-year 1.71%, 30-year 2.52%. The German 10-year bund yield is 0.084% off the 0.06% low.

At 10 AM, Factory Orders are up +1.9% missing the +2.0% expected but better than the prior revised higher +1.7%. Capital goods orders are weak. ISM Non-Mfg Index is 52.9 missing the 55.5 expected by a mile and under the prior 55.7. New Orders are down. Employment is down from 53.0 to 49.7 in contraction and verifying the sick jobs report data. The USD prints a 93 handle at 93.99.

The SPX is down 15 points to 2090. The Dow is down 125 points at 17715 nestled back between the 20-day MA support at 17696 and 50-day MA resistance at 17754. The breakout or breakdown from this range is important. The Nasdaq loses 47 points to 4924. RUT -1%.

Trannies receive a flat tire with TRAN down -1.5%. Airlines, truckers and shippers are lower but railroads are holding up. XAL -0.6%. DAL -2.3%. YRCW -2.7%. JBHT -1.6%. UPS -0.8%. FDX -1.9%. UNP +0.8%. CNI +0.7%.

At 10:26 AM EST, the SPX is down 18 points, -0.9%, to 2087.

Keystone the Scribe

SPX S&P 500 2-Hour Chart

Stocks are a coin-flip with the US Monthly Jobs Report on tap tomorrow morning at 8:30 AM EST (1:30 PM London; 2:30 PM Frankfurt; 8:30 PM Hong Kong; 9:30 PM Tokyo). Here is a look at the 2-hour chart. Keystone highlighted this with the red lines a couple days ago. The neggie d, rising wedge and overbot RSI and stoch's create the spank down. Price only dropped to 2085, however, and the bulls came in to send stocks higher again.

Note the weak and bleak MACD line but the SPX price recovered higher anyway. The negative MACD cross remains in play. There was an intraday oil rally both on Wednesday and today (Thursday) which sent stocks higher. The three white candlesticks show the intraday rally moves for each day. Watch oil since as oil goes, so goes the markets.

The tight standard deviation bands are starting to squeeze out a huge move to the upside. The bears have one chance, tomorrow, to reverse this move, otherwise, price will likely run strongly higher. The upper band is violated so the middle band at 2095 and rising is in play. Note how in the prior chart the expectation was for price to return to the middle band, at a minimum, which it did. Price has not touched the lower band in a while so that has to be on the "to-do" list moving forward.

The prior tight bands in late April squeezed out a move lower from 2100 to 2055 that is 45 handles. Thus, if the upside is the path ahead, and 2090 started the joy, then 2135 is the target which is exactly the all-time record high for the S&P 500. Bears need to reverse price pronto and a drop from 2105 would target 2060-ish.

The dark maroon lines show the higher high in price occurring over the last 11 candlesticks with every indicator negatively diverged. Thus, a move lower in the SPX would be anticipated although the jobs report, central banker jawboning or oil price moves may try to yield a different result. The uber low CPCE put/calls indicate complacency ongoing in markets. Investors Intelligence shows a high percent of bulls at the same time the bears drop to a very low percent. Market participants may be wringing their hands in worry and concern, however, you have to watch what they do not what they say and low put/calls, low volatility and complacent sentiment are all indicators that a pull back in stocks would be appropriate. Talking heads are expressing faux worry since they are buying stocks without a care in the world 10 minutes later.

The expectation is for lower prices in the near-term but the jobs report may want to rally stocks instead. If the jobs report creates bullishness, the chart will quickly adjust and likely delay the top until Monday or Tuesday. 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 Monthly Chart Standard Deviation Bands Tighten Forecasting an Epic Move in Stocks for the Months Ahead

The EOM was on Tuesday on 5/31/16 and May is a positive month. June begins at SPX 2097.

The red lines show the wicked rising wedge pattern, negative divergence and overbot conditions that made the top call last year easy. The purple circle shows a Tweezer Bottom that occurs in January-February and the rally higher has been very robust. The red lines show that when price printed the February low, the indicators were printing lower lows and preferred to see price come back down again after any bounce in the monthly time frame. The SPX has only headed higher instead.

Stocks are in a sideways choppy pattern the last couple years. The recent action has been chewing up bulls and bears alike. Once volatility moves higher, the action will become far more dramatic with huge point swings intraday and day to day. The volume during the December-February selloff is far more than the volume during the recovery from February to present.

The standard deviation bands are coming in real tight, the tightest in many years; decades. There is a huge move on tap but the tight bands do not predict direction only magnitude. Thus, say at Labor Day, about 3 months from now, the SPX is either going to be above 2200 marching higher, or, in the 1900's collapsing lower. The tight bands signal that something very epic is about to happen in markets from now into the Fall.

Rising wedge patterns are ominous and typically require huge reversals of 50% and more many are 100% reversals. Very few market participants are ready for moves way lower at sub 1400 and even sub 1100 but that is what a rising wedge would be expected to eventually shell out. Price is in the neighborhood of last year's April and May record highs and note that during that same time period the indicators are negatively sloped (thin red lines). Price rises to prior levels but the indicators are not enthusiastic. Negative divergence would occur if price makes a new record high with the thin red lines all showing neggie d; that would result in a selloff after the new highs are printed.

The old-timer's follow the 10-mth MA and Keystone uses the 12-month MA as a key cyclical signal for stocks. Both are at 2032-2033 so this level takes on extreme importance. The stock market is toast if it loses 2032. Price, however, is well above at 2105. The 20-mth MA is 2047. Lumping these three together is 2032-2047 so consider this level a key pivot area.

The bulls are winning and will receive victory going forward as long as they stay above the 2032-2047 area. A huge stock market directional move is about to occur and last about 2 or 3 months. If bulls touch the upper band at 2166, they will likely run it vertically higher after that. If price reverses to the downside to the lower band at 1929, the SPX will tumble lower after that. As summer ends and the beaches close, one side is going to be very very happy and the other side very very sad. Economic and market history is about to be written in the months ahead. 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.

CPCE Put/Call Ratio Daily Chart

The uber low put/call ratios (red circles) indicate a significant market top at hand. It is not uncommon for stocks to continue higher for a day or few after the low put/calls are printed. The expectation remains for a sell off in stocks going forward on the daily basis to remedy the complacency. The long side for stocks would not be considered or attractive until the CPCE prints up around 0.90-ish and higher.

Markets are exhibiting very odd behavior. Central banker jawboning plays a role in keeping stocks elevated. ECB President Draghi was flapping his dovish wings this morning. The last couple days, stocks recovered intraday purely in sync with oil prices recovering. So pay attention to oil. The Monthly Jobs Report is tomorrow morning and will impact markets. The low put/call ratios have not received a strong selloff as yet so this remains on the table going forward for the days and week or two ahead. If the jobs report creates mayhem, the low put/calls will accelerate the sell off in stocks. If stocks rally on the jobs report tomorrow, then the near-term stock market top would be assumed to occur tomorrow afternoon or say, on Monday. 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 Weekly Chart

The bulls are keeping stocks elevated with central banker jawboning, higher oil prices and lower volatility. The weekly chart was on tap to make higher highs, which continues to occur, so it is a good time to take a look at the progress in the weekly time frame. The red lines clearly show the negative divergence in play. The stochastics are overbot. These indications should create a smack down in price but note the long and strong MACD line. The MACD line wants another matching or higher high in price after the pull back occurs.

Thus, stocks will likely sell off next week, but then recover, say the week after (6/13/16) which is the Fed decision on 6/15/16. At that time with the higher high in price, the MACD has to be assessed to see if it turns neggie, if so, then the top is in and prices begin trailing lower say from mid-June forward. After the near term selloff say through next week, when price comes back up, if the higher price creates a higher high in the RSI, or MACD, then the bulls are going to spend a few weeks in charge.

The hanging man candlestick forecasts a potential trend change ahead. The brown circles show distribution taking place in the markets. The selling volumes are higher the day after a market up day representing excited retail traders like Ma and Pa Kettle, Joe Sixpack and Aunt Edna, buying stock off the institutions that are distributing their shares. Lots of drama is ahead with Fed and other central bank shenanigans, oil volatility, the Brexit vote and Spanish elections on tap over the next three weeks. The sick European banks must be bailed out. China is shaky and Japan may be sliding down the rabbit hole. 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.

INDU Dow Industrials Daily Chart

This morning, the purple circle shows where the Dow Industrials were deciding to either fail under the 20-day MA support at 17694 or breakout above the 50-day MA resistance at 17750. The bulls win with price breaking out to the upside boosted by the rise in oil prices. The 50-day MA becomes support. This level is very important. Each day price is above the 50 is another nail in the bear's coffin. Market bears got nothing unless they push the INDU under 17750 pronto.

The last two candlesticks are hanging men indicating a potential trend change on tap. The buying volume is nowhere near the selling volume from Tuesday. The 20-day MA under the 50-day MA is a negative cross. These indications are all bearish. Bears will only claim victory ahead if the Dow drops under the 50-day MA and then the 20-day MA. If a positive cross occurs with the 20-day above the 50-day there are likely record highs ahead for stocks. The 20-day MA will curl higher as long as price is above. his 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.

BPSPX S&P 500 Bullish Percent Index Daily Chart

The bulls are partying every day slapping the bears silly. The BPSPX was on a double-whammy sell (see previous BPSPX chart; scroll back or type "BPSPX" in the search box at the right to bring it up) as shown by the two red lines. The BPSPX bases in the near term at 66.60 so a six percentage-point reversal at 72.60 would issue a buy signal.

The 70% level is key. A market buy signal occurs when price moves above the 70 level on Tuesday this week. This nullifies the double-whammy sell signal and creates a neutral vibe reflective of the ongoing choppy sideways behavior in the broad indexes. The bulls need BPSPX above 72.6 which will create a double-whammy buy signal and happy times for the market bulls ahead; probably new all-time record highs.

The bears need the BPSPX to fall back under the 70 level that will reinstate the double-whammy sell signal. The stage is set. Bulls win big above 72.60. Bears win big under 70. 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.