SPX Monthly Chart 10-Month MA Failure Ushering in Cyclical Bear Market

Two important signals are in sight for the SPX after a couple years of wine and roses. The old-timer's follow the 10-month MA at 1910.54 and moving flatish as a key intermediate and long-term market signal. Equities are in big trouble if the 10-month MA fails and an initial flush is likely since the algorithm's will sell at this level as well. The 10-month MA created the exact market low at 1735-ish in February verifying the street cred of this not-too-well known or followed key level.

The 12-month MA is 1897 one of Keystone's cyclical market signals and represents a cliff in markets. If the 12-month MA falls, equities can fall directly into crash mode. Price is playing around at 1916 right now with a LOD at 1915. If 1910.54 fails, things will get ugly and price should drop to the 200-day MA at 1905.27 in a hearbeat. The drama continues. 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 10:35 AM: LOD is 1912.84 with price now at 1915.95 dancing with the devil.

Note Added 10:40 AM: LOD holds at 1912.84 and price bounces to 1919.63. The bulls have fortified the 1910-1912 support level with all their might and held the line on the first attack. Bears will probably attack 1910-1912 again. Do not release the seat belts. Remain strapped in. The 1920 resistance is intermediate resistance between the stronger 1910 and 1924. Price came up and the 1920 R held for the bears. So bulls need to move above 1920 and preferably above 1924 before they can wipe the sweat from their brow. Bears will continue to push for the 1910-1912 failure.

Note Added 10:46 AM: Bulls do not have the strength to move above 1920 R so price leaks lower. This is important; if price does not take out 1920 right here right now, the 1910-1912 will probably fail. What say you markets?

Note Added 10:52 AM: SPX 1924.37. Bulls pull a handkerchief from their Joseph A Bank five-for-one suit jacket pocket dabbing beads of sweat from their foreheads breathing a sigh of relief but remaining attentive.

Note Added 2:34 PM: HOD 1936.98. LOD 1912.84. SPX 1924.36. Nothing has changed for the last 3-1/2 hours. Bears may make a run lower now testing 1924 support again.

Note Added 2:36 PM: Price loses 1924 support so the 1920 support should be tested and that would lead to drama at the 1910-1912 support again which is the 10-month MA and LOD. Will there be more drama in front of the weekend? Utilities push higher today with UTIL up +1.2% to 565 which will set the bulls up with an advantage come Monday morning.

Note Added 2:41 PM:  Here's the test of 1920 support. Bounce or die. ...1920.18 ....1920.35 ....... the Dow turns negative a few minutes ago...... 1920.39 ... 1921.21 ......

Note Added 4:22 PM:  The SPX ends the day and week at 1906 losing the 10-month MA at 1909.46 for the first time since November 2012. The stock market is in serious trouble. A loss of the 10-month is a signal that equities have fallen into a cyclical bear market pattern. Next week will be pivotal since the bulls will only have a few days to right the ship and move price back above the 10-month MA and if they don't, the bulls will be slaughtered.