SPX Monthly Chart Rising Wedge Overbot Negative Divergence

The monthly charts receive new prints with July ending. The broad indexes post large gains leaving June's negativity in the dust. The power of the central bankers easy money policies are relentless driving markets to new all-time highs. The BOJ weakening the yen (higher dollar/yen) is a major bull fuel for markets this year. Yesterday's thrust higher in equities, to begin August, are in a large part due to the dollar/yen moving up two large handles (weaker yen), from 97.50 to 99.61 in one day's time; that's a lot of bull juice. The maroon lines and arrows on the chart show the prior tops, easy enough to identify as they occurred due to the negative divergence, but markets are not permitted to correct properly due to the central banker easy money. The Fed's central mandate is no longer employment and rates but rather keeping the stock market elevated at all costs. And they are succeeding.

The red lines show the 4 1/2 year rising wedge in play with price in the apex now. The collapses from rising wedges can be quite dramatic. This rally is the fifth longest in the history of the stock market and would be expected to peter out at any time. The red lines for the indicators show negative divergence across the board and in different time frames. Price is above both the 2007 and 2000 highs but the indicators are negatively diverged and overbot. Drilling down to the near term, the two short green lines for MACD line and money flow show short term momo (one to three months) in play so the Fed, BOJ and other central banker easy money creates upward thrust. This remaining momo can string the top along for another one to three months into the infamous October time frame. The markets are driven higher on central banker liquidity. Projection is for markets to top out at any time and move sideways to sideways lower for the months forward. 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.