SDY Dividend ETF Monthly Chart; Overbot; Negative Divergence; Dividend Bubble Popping

The DVY daily chart was previously posted; here is the SDY another dividend ETF. The DVY and SDY charts are basically interchageable and the same technical analysis applies to both. To complement the prior DVY and T charts, staying with the dividend theme, the SDY monthly chart shows that a multi-year top is at hand. The only thing that can save the day is more central banker money printing, however, the ECB is set to begin tapering the monthly purchases from March to April and the Fed, BOJ and other central banks are out of ammunition. The Fed is desperately trying to sneak rates higher since it has no bullets to fight a recession (the Fed cuts rates in a recession to spur the economy and bring it back to life).

The chart is ugly and indicates the dividend bubble is finally popping after a one-year rally. Keystone called the prior market top in spring 2015. The red lines clearly show negative divergence and overbot RSI and stochastics very bearish indications. Ditto the rising red wedge pattern. Price is at the top of the mountain with no further to go. The view is great from up here, however, it looks to be a long way down.

The pink box shows the downtrend during the 2008-2009 crash was a strong trend lower until 2010. The Federal Reserve, former Fed Chairman Bernanke, stepped into markets in March 2009, spitting on free markets and capitalism not permitting stocks to correct properly; it was more important for the privileged elite class to save the stock market and protect their wealth. President George W Bush shamefully said in late 2008 that he had to destroy capitalism to preserve it.

The large investment banks and other companies such as AIG and GM were bailed out by the government in early 2009. America is not a free country nor does it have free markets or implement capitalism. The United States is simply more free than most other nations. The US employs a 'pseudo-free market crony capitalism system' that maintains wealth for the top 8 to 15 million Americans at the expense of the remaining 310 million. The central bankers perform the bidding of the large investment banks since Fed members are paid off with lucrative kickbacks for appearing at token luncheons after they leave office. The relationship between the investment banks, politicians and the Fed is so obscene and incestuous that it would make Caligula blush.

Note that even with the multiple years of central banker intervention ongoing, the ADX did not confirm a strong trend higher for divvy stocks until 2013 and this strong trend higher remains until the end of last year six weeks ago. The ADX drops to 21 confirming that the uptrend in dividend stocks on the monthly basis is no longer in a strong uptrend.

The chart is cooked and divvy stocks, and the broad market, are likely printing a multi-year top during the coming weeks. These prices may not be seen again for 5 to 8 years so think long and hard about any long positions you hold. The tiny sliver of strength in the short term with the MACD line may create a jog move (down for a mth or two, then up for a mth or two, then roll over), however the move lower should likely start sooner rather than later. The stock market is likely topping out anytime from now through June with more emphasis on the top occurring say, now through April. Once price begins trending lower, a long term downward bias will remain for many months, a year or two, maybe longer. Scale out of divvy and other long stock positions going forward and keep the money in cash. 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 2:55 PM EST on Thursday, 2/9/17: SDY is up +0.5% this week thus far now printing 86.64. The weekly chart is in negative divergence. Take the dough and walk away. Leave that money in cash for a few weeks and months.