Quarterly Reminder September 2016

It's time for the Quarterly Reminder,

The KE Stone blogs (Keybot the Quant; Keystone Speculator; Keystone the Scribe) generate huge international interest with thousands of daily followers and continue to increase but the support does not match the strong interest. At the same time, ad blocking software continues to destroy free original content on the internet.

Daily updates to the Keystone the Scribe website are suspended but the Daily Chronology of Global Markets and World Economics monthly publications will continue through Amazon. The September Daily Chronology 2016-09 will be published and available internationally on 10/1/16. The October release is tentatively set for a 11/5/16 publication date.

The Keybot the Quant algorithm updates are suspended. Ditto all the charts and valuable technical analysis on the Keystone Speculator site. The support for the sites do not match the thousands of daily users. Proceeds from the blogs go to charity.

VIX Volatility Daily Chart

The VIX slips under the important 200-day MA at 16.72 ushering in bullish markets for the hours and days ahead. Bulls win below 16.72. Bears win above 16.72.

Keybot the Quant identifies XLF 23.84 as a key bull-bear line in the sand. Price is at 23.88 which creates lift in the broad stock market. Thus, bulls have lower volatility and higher banks on their side. Bears got nothing unless they push VIX above 16.72 and XLF below 23.84. 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 11:47 AM EST: VIX 16.29. XLF 23.92. SPX 2142.

SPX S&P 500 2-Hour Chart

The SPX is printing at 2124. From the SPX S/R article on the weekend, S/R in this area shown by the brown lines is 2169, 2164, 2160, 2156-2157, 2152, 2135, 2131, 2129, 2126, 2123, 2121 and 2118. The 100-day MA is 2121 and the 20-week MA is 2123. Price is testing the critical 2123 level for a bounce or die decision.

Note the positive divergence (green lines) for the indicators that want to see price bounce and recover. The MACD line, however, is weak and bleak. Thus, some buoyancy in price should occur in this 2-hour time frame then price will come back down again, and, if the MACD line is positively diverged at that time, the near-term bottom will be in place. The 1-hour chart is set up to bounce with possie d across all its indicators.

The expectation would be for the SPX to recover, say, after a bottom is placed either before the closing bell today or shortly after tomorrow's open. The bottom can occur at anytime. Stocks are usually bullish from a Tuesday low to a Wednesday high during OpEx week so price may want to bottom today and perhaps rally into tomorrow afternoon. Keystone bot some index longs a few minutes ago to play this counter trend rally perhaps beginning at any time forward. It would be expected to be a quickie long trade maybe only a day or so. If stocks collapse, Keystone will ditch the longs and make a run for it.

The lower standard deviation band is violated so the middle band at 2157 and falling is in play. The 2156-2157 level is key S/R. A near-term bounce may target this level. The 50-day MA is 2166. The critically-important 200 EMA on the 60-minute chart at 2166 will need back kissed at some point forward.

Keybot the Quant identifies XLF 23.84 as the key line in the sand today. XLF is holdinig at 23.90. You will know that stocks will slide down the rabbit hole if XLF 23.84 fails. If XLF floats higher, then the above analysis would be likely where stocks will recover at anytime and rally for a few hours 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.

Note Added 3:15 PM EST: Stocks weaken and are at the lows. SPX is at 2122.78 with a LOD at 2120.27. XLF is 23.86 fighting at the important 23.84 level. VIX is 18.69 not printing higher than the high at 18.97 about an hour ago.

Note Added 3:32 PM EST: SPX 2130. XLF 23.93. VIX 18.26.

SPX &P 500 60-Minute Chart 200 EMA Cross

Stocks should remain bearish for the hours and days ahead with the SPX under the 200 EMA at 2169. Bulls got nothing unless they move SPX above 2169.

The brown lines show a sideways channel at 2164-2185 in play. Price fell through the bottom rail and then recovered to back kiss the bottom trend line yesterday. The indicators are long and strong wanting to see matching or higher price highs once any pull back occurs in the hourly time frame so it appears that a test of the critical 200 EMA at 2169 is likely. Price will bounce or die from the 200 EMA and tell the story forward.

Key S/R is 2169-2171 (200 EMA on 60-minute 2169; September begins at 2171), 2164-2165 (price resistance 2164; 50-day MA at 2165), 2156-2157, 2152 and 2135. The SPX begins Tuesday at 2159.

During OpEx each week, stocks usually rally from a Tuesday low to a Wednesday high. The full moon is Friday and stocks are typically bullish moving through the full moon. 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 at 2:28 PM EST on Tuesday, 9/13/16: Stocks take back Monday's gains. The SPX is printing at 2124 so it fell down through the support levels listed. From the SPX S/R article on the weekend, S/R in this area is 2135, 2131, 2129, 2126, 2123, 2121 and 2118. The 100-day MA is 2121 and the 20-week MA is 2123. Price is testing the critical 2123 level for a bounce or die decision.

VIX Volatility and RUT Russell 2000 Daily Charts at Key Pivot Points

As the market bulls stage a small comeback rally after Friday's drubbing, the jury remains out as to whether the rally has staying power. The two parameters above determine today's market fate.

Volatility will provide an up or down signal at the VIX 200-day MA at 16.70. Price came down to test, and slipped under to a LOD at 16.55 but recovered now back above at 17. Market bears win if VIX is above 16.70. Market bulls win if VIX drops under 16.70.

The RUT 50-day MA at 1219 also provides market drama. Price is sticky at this level deciding to bounce or die. As small caps go, so goes the markets.

Thus, if the VIX drops under 16.70 and RUT moves above 1219, the bulls will throw confetti since the selling is over and the rally will gain steam higher. If VIX remains above 16.70 and the RUT starts to stumble lower under 1219 the bears will begin growling strongly again. 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 11:04 AM EST: The VIX is at 16.78 and the RUT is at 1220. The mixed signals create a sideways stumble for stocks. Bulls need 8 more pennies lower in the VIX to claim victory ahead. Bears need to push the RUT back under 1219 or they will fold like a cheap suit. The SPX is at 2136 trying to punch up through the very strong 2135 resistance (reference the SPX S/R article from the weekend). Bulls will recover nicely if they can hold the S&P 500 above the important 2135 S/R so watch this level along with VIX 16.70 and RUT 1219.

Note Added 11:13 AM EST: VIX 17.00. RUT 1220. SPX 2135. The beat goes on.

Note Added 11:49 AM EST: VIX 16.54. RUT 1224. SPX 2140. The bulls tentatively celebrate the pivots in their favor by throwing small amounts of confetti.

Note Added 7:31 AM EST Tuesday Morning, 9/13/16: The bears were slapped in the face yesterday as the VIX failed through the 200-day MA at 16.70 and RUT jumped higher above 1219. The SPX punched up through the strong 2135 resistance and the bears were toast. Key S/R is 2169-2171 (200 EMA on 60-minute 2169; September begins at 2171), 2164-2165 (price resistance 2164; 50-day MA at 2165), 2156-2157, 2152 and 2135. The SPX begins Tuesday at 2159.

SPX S&P 500 Support, Resistance (S/R), Moving Averages and Other Important Levels for trading the Week of 9/12/16

SPX (S&P 500) support, resistance (S/R), moving averages and other important levels are provided for the trading week of 9/12/16. Levels shown in bold are strong resistance and support. Bold and underlined levels are very strong and important S/R.

For the S&P 500 in history, the all-time record high prints on Monday, 8/15/16, at 2193.81. The all-time closing high is 2190.15 on 8/15/16. The SPX has taken out the May 2015 highs after this stock market top held in place for 15 months. The bulls were correct to expect new highs in stocks as new records were printed one month ago. The bulls, however, receive a firm slap in the face last Friday with the 53-point drop in the S&P 500 (SPX) and nearly 400-point drop in the Dow Jones Industrials (INDU; DJI). The all-time record intraday low is 666.79 (the infamous 666) on 3/6/09 and all-time closing low is 676.53 on 3/9/09.

For 2016, the intraday high for this year is the 2193.81. The closing high for this year is at 2190.15. The intraday low for this year is 1810.10 on 2/11/16 and the closing low thus far this year is 1829.08 on 2/11/16. The intraday low in 2015 was 1867.01 on 8/24/15 and intrayear closing low for 2015 was 1867.61 on 8/25/15. Obviously, a failure under the 1810-1868 zone would lead to a further catastrophic path ahead for stocks.

The SPX finished August printing a negative month. The SPX begins September at 2170.95. The SPX is at 2128 which is 84 points, +4.1%, above the starting year number at 2044. The central bankers saved the markets in February and the coordinated global money printing creates the multi-month rally into the top one-month ago. The central bankers are the market. Always.

Last Friday, 9/9/16, long investors were smacked in the face with a 2x4 (a piece of wood). On the top side, that 2183-2186 area is very strong resistance; it stopped the bull’s upside hopes. Price failed from this area. The SPX lost the important 200 EMA on the 60-minute chart at 2171 on Friday which ushers in bearish stock market action for the hours and days ahead. The bulls are in trouble as long as the SPX remains under 2171. The low CPCE put/call ratio chart verified the rampant market complacency so traders were slapped back to reality as was forecasted.

Once the 2169-2171 level failed, it was over. Price collapses to the strong support and 50-day MA at 2164 and fails. The SPX then falls through very strong and sturdy support at 2135, 2131 and 2129, that is now very strong resistance. The 2118-2135 range is a very solid support area for the S&P 500. The 2126 support holds during Friday's carnage. If the 2121-2126 level fails, price will be at 2118 in a flash for a critical bounce or die decision. If price moves lower from 2118, then it is likely headed sub 2K. The SPX will drop from 2118 to 2110 to 2102 and then to 2094. The 2072 level is the cliff for markets; under here and stocks can easily go into free fall.

For the new trading week ahead, Monday, 9/12/16, with the S&P 500 beginning at 2128, the bears need any smidge of red in the S&P futures overnight into Monday morning, and the SPX will accelerate several handles lower after the opening bell. The bulls need to recover Friday’s losses to regain their mojo, a formidable task, so instead bulls will try to send volatility lower while pushing utilities, chips and commodities higher. A move through 2129-2185 is sideways action to begin the week.

This week is OpEx with Quadruple Witching on Friday. Stocks are typically bullish from a Tuesday low to a Wednesday high during OpEx week. A full moon, the Harvest Moon (cue Neil Young), peaks on Friday at 3 PM EST. Stocks are typically bullish moving through the full moon each month. The seasonality factors point to buoyancy in stocks from Tuesday to Wednesday and then from late Thursday into next Monday, however, any news event or central banker action will immediately override any seasonality factors. Thus, the bears may flex their muscles to begin the week with a potential low occurring on Tuesday.

Looking at the near-term picture the strongest price support/resistance is 2194, 2190, 2183, 2175-2178, 2169-2171, 2164, 2156-2157, 2152, 2135, 2131, 2129, 2126, 2121-2123, 2118, 2110, 2102, 2094, 2089 and 2079-2083.

Note: If the list below displays any blank spaces, view it in a different browser.

2194 (8/15/16 All-Time Intraday High: 2193.81) (8/15/16 Intraday High for 2016: 2193.81)

2193

2190 (8/15/16 All-Time Closing High: 2190.15) (8/15/16 Closing High for 2016: 2190.15)

2187.87 Previous Week’s High

2187

2186

2185

2183

2182

2179

2178

2177.60 (20-day MA)

2175

2174

2173

2170.95 September Begins Here

2170.54 (200 EMA on 60-Minute Chart a Keystone Market Turn Signal)

2170

2169.08 Friday HOD

2169

2165

2164

2163.83 (50-day MA)

2160

2157

2156

2152

2135 (5/20/15 Intraday High: 2134.72)

2133 (7/20/15 Intraday High 2132.82)

2131 (5/21/15 Closing High: 2130.82)

2130 (6/22/15 Intraday High 2129.87)

2129

2128 (7/20/15 Closing High: 2128.28)

2127.81 Friday Close – Monday Starts Here

2127.81 Friday LOD

2127.81 Previous Week’s Low

2126 (4/27/15 Intraday High: 2125.92)

2124 (6/23/15 Closing High: 2124.20)

2123

2121 (4/24/15 Intraday High: 2120.92)

2120.16 (100-day MA)

2120 (2/25/15 Intraday High: 2119.59)

2119.75 (20-week MA)

2118 (4/24/15 Closing High: 2117.69)

2117 (3/2/15 Closing High: 2117.39)

2116 (11/3/15 Intraday High: 2116.48)

2114

2113

2111 (4/20/16 Intraday High: 2111.04)

2110 (11/3/15 Closing High; 2109.79)

2109

2108

2105

2104 (12/2/15 Intraday High: 2104.27)

2103 (12/2/15 Closing High: 2102.63)

2102 (4/20/16 Intraday High: 2102.40)

2100

2099

2097

2094 (12/29/14 Intraday High: 2093.55)

2093

2092

2091 (12/29/14 Closing High: 2090.57)

2089

2086

2084

2083

2081

2080

2079.48 (150-day MA; the Slope is a Keystone Cyclical Signal)

2079 (12/5/14 Intraday High: 2079.47)

2077

2076 (11/28/14 Intraday High: 2075.76)

2075 (12/5/14 Closing High: 2075.37)

2074

2073 (11/26/14 Closing High: 2072.83)

2072.45 (12-month MA; a Keystone Cyclical Signal) (the cliff)

2072

2071 (11/21/14 Intraday High: 2071.46)

2070.96 (10-month MA)

2069

2067

2065

2064.69 (20-month MA)

2064

2063

2061

2057.32 (200-day MA)

2057

2056 (11/18/14 Intraday High: 2056.08)

2055.76 (100-week MA)

2054.51 (50-week MA)

2053

2052

2050

2046 (11/13/14 Intraday High: 2046.18)

2044 (12/31/15 Closing High: 2043.94)

2043.94 Trading for 2016 Begins Here

2042

2040

2038

2034

2032

2030

2023

2022

2019 (9/19/14 Intraday High: 2019.26)

2017

2011 (9/18/14 Closing High: 2011.36) (9/4/14 Intraday High: 2011.17)

2007 (9/5/14 Closing High: 2007.71)

2005 (8/26/14 Intraday High: 2005.04)

2003 (8/29/14 Closing High: 2003.37)

2002

1999.14 (150-week MA)

1998

1997

1995

1993 (1/15/15 Closing Low: 1992.67)

1991 (7/24/14 Intraday Top: 1991.39)

1988 (7/24/14 Closing High: 1987.98)

1987

1986 (7/3/14 Intraday Top: 1985.59)

1985 (7/3/14 Closing High: 1985.44)

1983

1982

1981 (2/2/15 Intraday Low: 1980.90)

1980

1979

1978

1977

1973

1970

1969

1968 (6/24/14 Intraday Top: 1968.17)

1965

1964

1963 (6/20/14 Closing High: 1962.87)

1961

1958

1956 (6/9/14 Intraday Top: 1955.55)

1951 (6/9/14 Closing High: 1951.27)

1949

1948

1943

1942

1937

1936

1931

1928

1924 (5/30/14 Intraday Top: 1924.03) (5/13/14 Closing High: 1923.57)

1920

1917

1914

1912

1910

1906

1902 (5/13/14 Intraday Top: 1902.17)

1901

1897 (5/13/14 Closing High: 1897.45) (4/4/14 Intraday Top: 1897.28)

1895.53 (200-week MA)

1891 (4/2/14 Closing High: 1890.90)

1889

1886

1885

1884 (3/21/14 Intraday Top: 1883.97) (3/7/14 Intraday Top: 1883.57)

1882

1879

1878 (3/7/14 Closing High: 1878.04)

1877

1874

1873

1872

1871.02 (50-month MA)

1870

1868 (8/25/15 Closing Low: 1867.61)

1867 (8/24/15 Intraday Low: 1867.01)

1865

1862

1859 (1/20/16 Closing Low: 1859.33)

1855

1851 (1/15/14 Intraday Top: 1850.84)

1849 (12/31/13 Intraday High Top for 2013: 1849.44)

1848 (1/15/14 Closing High: 1848.38) (12/31/13 Closing High for 2013: 1848.36)

1846

1845

1843

1841

1840

1839

1835

1831

1829 (2/11/16 Closing Low for 2016: 1829.08)

1828

1827

1824

1820

1816

1814 (11/29/13 Intraday Top: 1813.55)

1812 (12/9/13 Intraday Top: 1811.52) (1/20/16 Intraday Low: 1812.29)

1810 (2/11/16 Intraday Low for 2016: 1810.10)

1809 (12/9/13 Closing Top: 1808.37)

1808

1807 (11/27/13 Closing Top: 1807.23)

1806

1803

1801

1800

1799 (11/18/13 Intraday Top: 1798.82)

1798 (11/15/13 Closing Top: 1798.18)

1796

1793

1791

1788

1785

1783

1782

1781

SPX S&P 500 60-Minute Chart 200 EMA Cross Island Reversal

Keystone was warning about the potential failure of the 200 EMA on the 60-minute at 2171. It failed and price never looked back. Markets will be bearish for the hours and days ahead as long as the SPX remains below the 200 EMA at 2171 and moving lower.

The indicators are weak and bleak but oversold so a bounce is needed in this hourly time frame. Typically price would bounce and then roll back over to the downside again for a lower low due to the weak and bleak MACD line. At that point, in this hourly time frame, a more substantive relief rally may begin.

The full moon, the Harvest Moon, is on Friday and stocks are typically bullish through the full moon. OpEx is this week and stocks typically rally from a Tuesday low to a Wednesday high during OpEx week. So a mosaic develops, only based on the seasonality factors, where weakness in stocks may continue into Monday afternoon and Tuesday morning, then a recovery through Wednesday, then another quick dip on Thursday, but then a recovery into the weekend. Of course news events always override seasonality factors.

The brown lines show the gap up in early September that created an island (brown circle); you can call it Gilligan's Island. Price fell and gapped back down through the same gap creating the island reversal pattern. Pay attention to the 200 EMA especially as the new week of trading progresses. 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 Daily Chart Tight Band Squeeze Rising Wedge Collapse

Keystone has highlighted the tight standard deviation band squeeze (purple) over the last couple weeks. it was odd behavior for that tight tunnel to continue for one month before price resolved to the downside. Tight bands do not predict direction only that a huge move is about to occur and it was obviously down. The bottom band is violated so the middle band is in play when price decides to stage a relief rally.

The collapses from rising wedges can be quite dramatic. Keystone says this often so it is notable to highlight the pattern in the chart above. Price fell out of the rising wedge a few days ago, then came back up for a back test of the underside of the lower red trend line of the wedge, and then failed and collapsed. Remember, all chart patterns work the same in any time frame whether the rising wedge is on a monthly chart, weekly, daily, hourly or minute chart.

Watch the 100-day MA support at 2120 since the week ahead will likely entertain drama at this key moving average. The 20-week MA is also at 2120 giving this level further street cred as a key pivot point (bounce or die). The bears flex their muscles on Friday and wipe out two months of stock market gains in a heartbeat. The low CPCE put/call ratio forecasted the pull back ahead of time so all of you were prepared for the market theatrics. 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.

VIX Volatility Daily Chart Battle at 200 MA

An extremely important event occurred yesterday in the market carnage. The VIX moves above its 200-day MA at 16.70 signaling bearish markets for the days ahead. One day does not make a trend so the bulls may push the VIX back under early next week. Bears win with the VIX above the 200-day and bulls win with the VIX under the 200-day MA.

The Keybot the Quant trading algorithm is short currently and tracking the VIX 14.53 level as a key bull-bear line in the sand. If the bulls push the VIX under 16.70, stocks will stage a comeback rally. The bulls, however, will need to push under 14.53 to signal the all-clear for a strong stock market rally ahead. Bears are fine going forward as long as they maintain the VIX above 14.53.

In the very near term, watch VIX 16.70. On Monday, it does not matter which way the stock market moves. Watch the VIX instead and it will be online after 3 AM EST. VIX 16.70 will tell you who wins and loses 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.

CMG Chipotle Mexican Grill Weekly Chart

La Cucaracha, La Cucaracha. Everbody sing for the burrito king. Hopefully, there are no cockroaches in the restaurants. Activist investor Bill Ackman at Pershing Square announces a large stake in troubled Chipotle so the stock pops. Folks became sick after eating the food a few months ago and the restaurateur struggles ever since. Tell that to my nephew who religiously devours the Mexican goodies at Chipotle and is glad that less people are there since he can eat faster.

Ackman has a mixed record on stocks picks and remains mired in his short HLF purgatory. Will he be luckier with CMG? Yes, probably. The falling green wedge, oversold conditions and positive divergence (green lines) forecast a launch in price which occurs over the last 2-1/2 weeks. Indicators remain long and strong so it looks like Ackman may have very good timing with Chipotle on the long side. He likely has a room full of chartists that highlighted the chart above 2 weeks ago when it was prime for a buy.

Price will likely want to tag the upper band at 460, then perhaps retreat back down to the middle band at 418 then resume the upside on this weekly basis. The daily chart gapped up yesterday so there may be some sideways digestion ahead in the daily time frame. Chipotle has been beaten down significantly over the last year so in a market downturn it may not be as negatively impacted as other stocks. Nonetheless, in a recession, people will eat out less.

Keystone does not hold a position in CMG currently but will consider a long play going forward. Ackman will likely be successful with his long Chipotle play as time plays out. 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 Saturday, 9/10/16: CMG finishes the week up +4.4% sitting at 426.55. Chipotle settles a lawsuit concerning its contaminated food a few months ago. This should help the stock since uncertainty is removed. Google and Chipotle team-up to deliver burritos by drone which will create a new buzz for the flailing restaurateur. Time will tell if the taco's and hot sauce can push it higher.

FXB British Pound Sterling Daily Chart W Pattern Double Bottom Upper Band Violation

After the Brexit vote in late June, the FXB (pound ETF) falls off a cliff from above 145 down to 126 in early July. BOE Governor Carney intervened to stabilize the FTSE and currency markets. The FXB staggers sideways through the 126.00-130.50 range for the last 2-1/2 months forming a double bottom. The thick green lines clearly show a W pattern bottom in play. The W is below both the 50 and 200-day MA's which creates big-time power for the W pattern. The further the W is under these two key moving averages the stronger it is; if the W pattern overlays these moving averages it is in play but not as powerful.

Thus, with the bottom of the W at 126.00 and the top breakout level at 130.50, that is a 4.50 difference so the upside target is 135-ish which happens to be where the gap down move that occurred directly after Brexit. This adds credence to the target.

The RSI and MACD line remain long and strong wanting to see higher highs in price after any pullback in this daily time frame. Ditto the stochastics but since they are in overbot territory so they are more agreeable to the pullback in pound during the coming days. The FXB weekly chart is positively diverged and agreeable to upside in sterling going forward.

The upper band is violated so the middle band, also the 20-day MA, is on the table at 128.30. The 50-day MA is 128.50. This confluence may create a magnet for price and set up a buy point for pound (blue dot). If the FXB then recovers, which would be expected, and breaks up through the 130.50 level, that would be a potential buy point. The FXB would then pop to 132-ish then retreat, if it follows a typical pattern for breakouts, and another buy point would be at 130.50-ish, then when the pound moves above that initial high at 132-ish that would be another buy point. Keystone has no position in sterling currently but will consider a long FXB play as the above analysis plays out.

The breakout pattern described can be adapted to any chart and breakout from patterns such as W's, channels, inverted H&S's (inverted head and shoulders) and C&H's (cup and handle).  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 at 7:27 AM EST: The ECB rate decision is imminent. The pound is at 1.3364.

Note Added Saturday, 9/10/16: The FXB chart is the pound ETF so its numbers are not the same as the pound (sterling) itself. Keep that in mind. FXB ends the week down -0.2% to 129.65. The pound is at 1.3275.

DAX Germany Daily Chart Positive for 2016

The DAX is positive on the year above its starting number at 10743. Whoopsies daisies. Over the last hour, the DAX trails lower now down -0.2% on the session at 10734 negative on the year by nine points. Watch the 10743 level going forward. Note the low print for the year in February. The upward-sloping channel is in play and price is teasing the top rail currently. 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 Signals Near-Term Market Top At Hand

The rampant complacency and fearlessness continues in the stock market. The VIX sports and 11-handle yesterday. The CPCE is down to 0.50 not having corrected higher for 2-1/2 months. It is comical although disturbing at the same time. The CPCE has not printed above 0.75 and typically 0.80 and higher is needed to identify a tradeable bottom.

Traders are drunk off Fed wine. Investors smoke ECB crack and inject BOE heroin then buy stocks with reckless abandon. What a glorious party and trip for the world's elite class that own large stock portfolios. There is no fear in markets. The ECB policy meeting is tomorrow and Draghi will likely provide more dovish talk.

It is very odd behavior for stocks to not pull back after the numerous low put/call readings. Since it is such a strange event, you wonder if there is a pent-up force that will want to flush stocks strongly lower, or, if it will be a milk toast move lower. Nonetheless, the low put/call indicates that a stock market near-term top is at hand at anytime probably before the weekend, perhaps today. 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 Saturday, 9/10/16: The top occurs on Wednesday, 9/7/16. On Friday, 9/9/16, stocks collapse. The SPX falls -2.5% to 2127. Traders are spanked due to their complacency. The top occurs before the weekend as forecasted above.

SPX S&P 500 60-Minute Chart 200 EMA Cross

On the one-hour chart, the SPX has threatened to violate the 200 EMA at 2170 over the last couple weeks but the central bankers keep finding a way to pump happiness into stocks. The gap up move last Friday after the jobs report creates the island that price is currently on in this one-hour time frame (brown lines). If price falls to 2175 and then gaps lower to 2170 and below, that would be an island reversal pattern. Otherwise, price may simply move lower and fill the 2170-2175 gap.

Price violated the upper standard deviation band so a move to the middle band at 2172, at a minimum, is on the table. Price prints a matching high on Friday but the RSI, histogram and stochastics went neggie d wanting a spank down in price. A spank down occurs to begin the week. The green lines, however, show long and strong behavior remaining in the MACD line and ROC hinting at another higher high or matching high for price. Note how the prices match from Friday to today (the last two candlesticks) on the close and open basis and the stochastics are flat (neggie d) and ROC neggie d (a hint of bearishness). The door has to be left open, however, for another move higher in this one-hour time frame but you will know if it is meant to be over the next hour or two of trading.

Price has lower targets at 2175, the 2172 middle standard deviation band and the 2169-2171 support gauntlet (reference the previous article displaying the SPX S/R).  If 2169-2170 is lost, stocks will be falling like a stone. If the SPX remains above the 200 EMA at 2170, the bulls remain in control of the stock market for the hours and 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.

Note Added 10:30 AM EST: Here you go. The SPX drops to 2175 contemplating if an island reversal is in the offing. Note that the 2175 is extremely strong support as shown in the SPX S/R article, so its failure would set up the test for the critical 2169-2171 level. Price bounces to 2177 so the first test of support results in a slight recovery. Price will likely test the 2175 again.

Note Added 9 AM EST on Wednesday, 9/7/16: The long and strong indicators pulled price higher as yesterday progressed; then a wild buying frenzy occurs into the closing bell. The SPX is at 2186.48 taking out the critical overhead resistance at 2183-2185. From noon into the final minutes of trading the SPX was in the tight 2182-2184 range. Looking at the one-hour chart now, indicators are neggie d except for the MACD line, and stochastics but stoch's are in overbot territory and will want to see a retreat in price. So a couple more candlesticks will be needed to try and turn the MACD line into negative divergence so an hour or two of trading time. Looking at the 2-hour chart, it hints at a bit more lift (2 to 6 hours) so stocks may remain elevated for much of today (Wednesday). With the ECB on tap in the morning and Draghi press conference, markets may sit idle and wait for the words of wisdom from central bankers. The CPCE put/call indicates rampant complacency continuing and a market top likely. SPX 2187 is very strong resistance so keep an eye on that number; bears will need to hold the line.

SPX S&P 500 Support, Resistance (S/R), Moving Averages and Other Important Levels for trading the Week of 9.6/16

SPX (S&P 500) support, resistance (S/R), moving averages and other important levels are provided for the holiday-shortened trading week of 9/6/16. Levels shown in bold are strong resistance and support. Bold and underlined levels are very strong and important S/R.

For the S&P 500 in history, the all-time record high prints on Monday, 8/15/16, at 2193.81. The all-time closing high is 2190.15 on 8/15/16. The SPX has taken out the May 2015 highs after this stock market top held in place for 15 months. The bulls, that continue to remain complacent due to non-stop central banker money-printing, are correct in their cheer leading the stock market higher since new record highs are printing. However, the last all-time high printed three weeks ago. The all-time record intraday low is 666.79 (the infamous 666) on 3/6/09 and all-time closing low is 676.53 on 3/9/09.

For 2016, the intraday high for this year is the 2193.81. The closing high for this year is at 2190.15. The intraday low for this year is 1810.10 on 2/11/16 and the closing low thus far this year is 1829.08 on 2/11/16. The intraday low in 2015 was 1867.01 on 8/24/15 and intrayear closing low for 2015 was 1867.61 on 8/25/15. Obviously, a failure under the 1810-1868 zone would lead to a catastrophic path ahead for stocks but this concern is not even on the map as equities print new all-time record highs near SPX 2200.

Keystone’s 80/20 rule says 8’s lead to 2’s so the close above 2180 hints that 2220-plus is on the table. The SPX finished August printing a negative month. The SPX begins September at 2170.95. The SPX is 127 points, +6.2%, above the starting year number at 2044. The central bankers saved the markets in February and the coordinated global money printing creates the multi-month rally. The central bankers are the market.

For the new trading week ahead, Tuesday, 9/6/16, with the S&P 500 beginning at 2180, the bulls need five points, to punch up through 2185, and price will accelerate higher into the 2190’s. Note the formidable ceiling at 2183-2185 so it would be a big deal and positive for bulls if this resistance is taken out. Stocks are trading for the new week the opening bell rang a few minutes ago. The SPX is up 2 points at 2182 above the 20-day MA at 2180. HOD is 2184 so the 2183-2185 resistance gauntlet holds in the early going.

The bears need to push below 2174 support and price will be testing the 2169-2171 support gauntlet in a flash. Bad things will happen to stocks under 2169-2171. The SPX moves sideways on Tuesday (today) between 2175-2184. The 200 EMA on the 60-minute chart at 2170 a key short term signal for stocks and if this fails, serious trouble begins. As long as the SPX stays above 2169-2171 the bulls will not be worried.

Looking at the near-term picture the strongest price support/resistance is 2194, 2190, 2187, 2182-2185, 2178, 2175, 2169-2171, 2164, 2156-2157, 2152, 2135 and 2131. The bulls do not have a care in the world unless the 200 EMA on the 60-minute at 2170 fails; if 2170 fails, stocks will begin dropping in earnest. As long as price is above 2170, the bulls are in control of the stock market for the hours and days ahead.

Note: If the list below displays any blank spaces, view it in a different browser.

2194 (8/15/16 All-Time Intraday High: 2193.81) (8/15/16 Intraday High for 2016: 2193.81)

2193

2190 (8/15/16 All-Time Closing High: 2190.15) (8/15/16 Closing High for 2016: 2190.15)

2188

2187

2186

2185

2184.87 Previous Week’s High

2184.87 Friday HOD

2184

2183

2182

2179.98 Friday Close – Monday Starts Here

2179.71 (20-day MA)

2178

2175

2174

2173.59 Friday LOD

2173

2170.95 September Begins Here

2170

2169.86 (200 EMA on 60-Minute Chart a Keystone Market Turn Signal)

2169

2165

2164

2160

2157.09 Previous Week’s Low

2157

2156

2153.09 (50-day MA)

2152

2135 (5/20/15 Intraday High: 2134.72)

2133 (7/20/15 Intraday High 2132.82)

2131 (5/21/15 Closing High: 2130.82)

2130 (6/22/15 Intraday High 2129.87)

2129

2128 (7/20/15 Closing High: 2128.28)

2126 (4/27/15 Intraday High: 2125.92)

2124 (6/23/15 Closing High: 2124.20)

2123

2121 (4/24/15 Intraday High: 2120.92)

2120 (2/25/15 Intraday High: 2119.59)

2118 (4/24/15 Closing High: 2117.69)

2117.94 (20-week MA)

2117 (3/2/15 Closing High: 2117.39)

2116.93 (100-day MA)

2116 (11/3/15 Intraday High: 2116.48)

2114

2113

2111 (4/20/16 Intraday High: 2111.04)

2110 (11/3/15 Closing High; 2109.79)

2109

2108

2105

2104 (12/2/15 Intraday High: 2104.27)

2103 (12/2/15 Closing High: 2102.63)

2102 (4/20/16 Intraday High: 2102.40)

2100

2099

2097

2094 (12/29/14 Intraday High: 2093.55)

2093

2092

2091 (12/29/14 Closing High: 2090.57)

2089

2086

2084

2083

2081

2080

2079 (12/5/14 Intraday High: 2079.47)

2077

2076.80 (12-month MA; a Keystone Cyclical Signal) (the cliff)

2076.18 (10-month MA)

2076 (11/28/14 Intraday High: 2075.76)

2075 (12/5/14 Closing High: 2075.37)

2074

2073 (11/26/14 Closing High: 2072.83)

2072.34 (150-day MA; the Slope is a Keystone Cyclical Signal)

2072

2071 (11/21/14 Intraday High: 2071.46)

2069

2067.30 (20-month MA)

2067

2065

2064

2063

2061

2057

2056 (11/18/14 Intraday High: 2056.08)

2055.61 (200-day MA)

2053.54 (100-week MA)

2053

2052

2050.58 (50-week MA)

2050

2046 (11/13/14 Intraday High: 2046.18)

2044 (12/31/15 Closing High: 2043.94)

2043.94 Trading for 2016 Begins Here

2042

2040

2038

2034

2032

2030

2023

2022

2019 (9/19/14 Intraday High: 2019.26)

2017

2011 (9/18/14 Closing High: 2011.36) (9/4/14 Intraday High: 2011.17)

2007 (9/5/14 Closing High: 2007.71)

2005 (8/26/14 Intraday High: 2005.04)

2003 (8/29/14 Closing High: 2003.37)

2002

1998

1997

1996.69 (150-week MA)

1995

1993 (1/15/15 Closing Low: 1992.67)

1991 (7/24/14 Intraday Top: 1991.39)

1988 (7/24/14 Closing High: 1987.98)

1987

1986 (7/3/14 Intraday Top: 1985.59)

1985 (7/3/14 Closing High: 1985.44)

1983

1982

1981 (2/2/15 Intraday Low: 1980.90)

1980

1979

1978

1977

1973

1970

1969

1968 (6/24/14 Intraday Top: 1968.17)

1965

1964

1963 (6/20/14 Closing High: 1962.87)

1961

1958

1956 (6/9/14 Intraday Top: 1955.55)

1951 (6/9/14 Closing High: 1951.27)

1949

1948

1943

1942

1937

1936

1931

1928

1924 (5/30/14 Intraday Top: 1924.03) (5/13/14 Closing High: 1923.57)

1920

1917

1914

1912

1910

1906

1902 (5/13/14 Intraday Top: 1902.17)

1901

1897 (5/13/14 Closing High: 1897.45) (4/4/14 Intraday Top: 1897.28)

1891.80 (200-week MA)

1891 (4/2/14 Closing High: 1890.90)

1889

1886

1885

1884 (3/21/14 Intraday Top: 1883.97) (3/7/14 Intraday Top: 1883.57)

1882

1879

1878 (3/7/14 Closing High: 1878.04)

1877

1874

1873

1872.07 (50-month MA)

1872

1870

1868 (8/25/15 Closing Low: 1867.61)

1867 (8/24/15 Intraday Low: 1867.01)

1865

1862

1859 (1/20/16 Closing Low: 1859.33)

1855

1851 (1/15/14 Intraday Top: 1850.84)

1849 (12/31/13 Intraday High Top for 2013: 1849.44)

1848 (1/15/14 Closing High: 1848.38) (12/31/13 Closing High for 2013: 1848.36)

1846

1845

1843

1841

1840

1839

1835

1831

1829 (2/11/16 Closing Low for 2016: 1829.08)

1828

1827

1824

1820

1816

1814 (11/29/13 Intraday Top: 1813.55)

1812 (12/9/13 Intraday Top: 1811.52) (1/20/16 Intraday Low: 1812.29)

1810 (2/11/16 Intraday Low for 2016: 1810.10)

1809 (12/9/13 Closing Top: 1808.37)

1808

1807 (11/27/13 Closing Top: 1807.23)

1806

1803

1801

1800

1799 (11/18/13 Intraday Top: 1798.82)

1798 (11/15/13 Closing Top: 1798.18)

1796

1793