SPX S&P 500 Monthly Chart; Overbot; Rising Wedge; Negative Divergence; Price Extended Above Moving Averages; Upper Band Violation; Stock Market Printing Long-Term Top

Now that August is in the rearview mirror and September has begun, the monthly charts can be assessed. The SPX (S&P 500), the major stock index most-closely followed by professional traders and considered synonymous with "the stock market" indicates that a long-term stock market top is in place a la October 2007. The SOX (Semiconductors Index) has also placed a significant long-term top. Ditto the trannies (TRAN; Dow Jones Transports).

INDU, or DJI (Dow Jones Industrials), is set up similarly as the SPX and SOX but the Dow has not overtaken the price high from late January. Ditto the NYA (NYSE Composite).

The COMPQ, NDX and RUT indexes are nearing their long-term tops but are not yet fully negatively-diverged due to the long and strong MACD lines. With the Labor Day holiday behind us and the last four months of the year ahead, it is a good time to review these charts and surmise how the long-term top in the stock market may play out.

The SPX monthly chart above displays the higher high in price as compared to the January record highs. The all-time high is 2916.50 and all-time closing high 2914.04 both printing on 8/29/18 a week ago. Note that all the chart indicators (RSI, MACD, histogram, stochastics and money flow) are negatively diverged verifying that the fuel tank that drives prices higher is empty. Stocks are now moving higher on fumes. The red rising wedge and overbot RSI and stochastics are also bearish indications. Price is also extended above its moving average ribbon requiring a mean reversion lower.

The S&P 500 has violated its upper standard deviation band since the beginning of the year so the middle band, also the 20-month MA, is on the table, at a  minimum, at 2608 and rising. This level is 280 handles under the current price; about -10% below.

The chart signals that the long-term top (months and years) is in place for the stock market like the March 2000 and October 2007 tops. The May 2015 significant top, that Keystone called in early 2015, was also a long-term top, but the global central bankers colluded to stop the slide in early 2016 that created the Tweezer Bottom on the chart. Of course the central bankers will always implement policies that protect the wealthy privileged class that own large stock portfolios. The central bankers perform the wealthy's bidding since they are rewarded by the investment banks for their loyalty with lucrative speaking engagements once they leave public office. Wall Street is a crooked cesspool of filth and nefarious activity.

As previously mentioned, watch the purple circle for the MACD. If price continues higher to new all-time highs and manages to nudge the MACD line to a higher high than January this will extend the long-term top for another one to three months, otherwise, THE stock market top is in.

The ADX shows that the trend higher since former Fed Chairman stepped in with QE1 in March 2009 to save the stock market and protect the wealthy, remains a strong trend higher. The ADX will need to roll over lower to further verify THE top. Note that the ADX was at 42-ish in early 2009 verifying the strong downtrend in the stock market when equities were crashing. The ADX was also in a strong uptrend in late 2014 but it petered out after the significant May 2015 top.

Also watch the Aroon since the green line will fall to verify that THE top is in for the stock market. These prices on stocks may not be seen again for many months even many years. If you are a young person contemplating placing money in the stock market; don't. Let that money sit on the sidelines, do not worry that it will not receive much of a return, if any. In a year or two, you will look back and realize it was a smart decision and at that time, depending on how things play out, you may have an excellent chance to enter the stock market at far lower prices. 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.