BPSPX Bullish Percent Index Daily Chart

In January, the BPSPX prints a six percentage points reversal from 23 to 29 which is a market buy signal and then moves above 30% for a double-whammy market buy signal. Stocks rally. The wine is flowing like water and it looks like the recovery may have legs although oddly, as the BPSPX climbs, stocks keep selling off. Something has to give. The party ends.

From the top at 40 a six point reversal is 34 which occurs for a market sell signal and gives a nod to the market bears. Watch the key 30% level tomorrow as a key market tool. If the BPSPX slides under 30, stocks are in for more carnage for a day or few. The market bulls must prevent the BPSPX from falling under 30 with all their might. If the bulls can move BPSPX up above 37-ish, they will be back in good shape with the double-whammy buy signal back in effect

If the BPSPX slides under 30, more selling will hit the stock market. The bright side for bulls, however, is that when under 30 it is only a matter of time before stocks will set up a base and recover. Note the last time 30 failed, the bottom occurred 3 days later and the BPSPX was back above 30 four days after that. Put the BPSPX 30% level on the top of your watch list for tomorrow and watch it like a hawk since it will tell you a lot. 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 on Tuesday evening, 2/9/16: The BPSPX drops to 29.40, under the 30 level, so the bears receive the double whammy  market sell signal. Since markets are psycho right now, give this another day. On Wednesday, the bulls must immediately pull BPSPX above 30. If BPSPX stays under 30 tomorrow, the market selling will likely linger for several days ahead.