BPSPX Bullish Percent Daily Chart

The red lines show negative divergence in September creating a spank down that followed thru with the indexes. Once BPSPX reverses six percentage points, that signals a move in that direction for markets. As October began, note the purple lines showing lower lows with price but positive divergence was not in place. Price actually would prefer seeing lower lows in the future. Nonetheless, markets popped in early October and had a gangbuster rally. When the BPSPX reversed to the upside by six percentage points, from 23 to 29, that verified that the market bulls were in clover. The 30% and 70% levels are key as well. Thus, once price moved above 30, this added additional bull fuel to the markets.

The green lines show higher highs with price and the indicators are agreeable to see another matching or higher high in price. However, the projection would be that once the BPSPX comes back up to 77-ish, this will create negative divergence as projected by the black lines. This will create a spank down which will correlate to markets selling off again. A reversal from 77-ish down to 71 would verify bear fun in place. A drop under 70% would then add bear fuel. First, however, BPSPX needs to match that high from late October to create the negative divergence that will in turn create the spank down. Note that the MACD histogram is in negative divergence for the two-month time frame (green line) which hints that the upside is limited for the broad markets here on out and market weakness should redevelop in the days 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.