SPX S&P 500 Monthly Chart; 10 and 12-Month MA's; Cyclical Bear Market

The SPX fails below the critically-important 12-month MA at 2742 ushering in a cyclical (weeks and months ahead) bear market. The 12-month is Keystone's cliff-edge and the stock market fell off the cliff. After that, the daily carnage is not surprising. If you are long stocks, you have no hope unless the S&P 500 recovers back above 2742. Stocks will continue sideways to sideways lower for the weeks, months perhaps years ahead--as long as the SPX remains below 2742.

If price recovers above 2742, the relief rally is real and has upside legs. The next critical test would be the 10-month MA at 2758. If price moves above 2758, the upside rally is guaranteed going forward. If the SPX bumps its head on the 2758 and is spanked back down, that is very troublesome and likely identifies that the long-term multi-year top is in for the stock market. If price then fails back below the 12-month MA, equities will begin cascading lower without hope of recovering which is what is occurring now with the SPX at 2706 well below the critical 2742.

Adding more negativity, the S&P futures are down 32 points Friday morning about an hour before the Q3 GDP data and a couple hours before the opening bell for the regular session. The VIX spiked above 27 a short time ago. Using cliche phrases, there is fear and panic occurring, the baby is thrown out with the bathwater and blood is in the streets. The high VIX hints that a tradeable bottom is very near. 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.