BPSPX S&P 500 Bullish Percent Index and SPX S&P 500 Daily Charts

When the BPSPX goes sub 35, you start looking for a relief rally. Holy smokes. An 11-handle. That is unbelievable. The negative sentiment is completely off the charts. Stocks are thrown out the window with indiscriminate selling. Folks are frantically selling and they do not even know why they are selling. The baby, bathwater and the kitchen sink are all thrown out the window.

The pundits now call for doom and gloom in 2019. These are all the same pundits that told folks to go long at the stock market top in late September early October.

The green circles show where rallies begin. What do you think will happen?

The six percentage-point reversals are key for the BPSPX. Thus, if price can reverse to 17.80 moving higher that would confirm that a relief rally is underway. This 11.80 number is really something; a complete collapse. It has nowhere to go but up which means a relief rally wants to begin. If President Trump will quit bashing Fed Chairman Powell and quit causing a commotion, stocks should recover strongly.

Considering the high put/call's, the uber low NYMO and the uber low BPSPX, it would not be surprising to see the Dow print a couple 1,000-point up days over the next couple weeks. The charts are ready to go for the bulls in the very near-term; it all depends on Donny.

On Monday, UTIL lost the 50-week MA at 709 which opened a trapdoor and flushed the stock market lower. If UTIL remains below 709, markets will crash going forward. If UTIL recovers above 709, that will reinforce a near-term relief rally theme. Ditto copper. Copper rises +1.8% finally printing an up day. Bulls need stronger copper for several days to kick a relief rally into high gear. Traders await President Trump's tweets to see if he is going to play nice for the holidays or continue the Ebeneezer Scrooge demeanor.

The Santa Claus rally period runs now through 1/3/19 so the bulls have this seasonality factor in their favor. Keystone continues adding index longs each day since last week (these entries are underwater now), however, Keybot, that operates on more of a short-term to intermediate-term smoother time frame, remains short. When Keybot flips long, you will be confident that the relief rally is underway. 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 Thursday Morning, 12/27/18, Before the Opening Bell: The stock market catapults higher on Wednesday setting multi-year records. The Dow gains 1,086 points the largest point gain in history. Speak of the devil, there's a 1,000-point up day. Now you can see the power generated from the high CPC and CPCE put/calls and low NYMO and BPSPX that signaled uber negativity and off-the-charts bearishness (stocks typically bounce when there is blood in the streets). However, the BPSPX is only up to 12.00 a small bump higher; bulls need the BPSPX to push above 17.80 to provide a market buy signal. There will probably be another big day ahead or at least a couple 5 or 6-hundo upside days for the Dow. US futures sink Thursday morning. S&P futures are down -38 with the VIX at 32.20 about 3 hours before the opening bell. The positive divergence on the SPX 2-hour chart launched the stock market higher. Ditto the daily chart. A pulse backwards is no surprise today but the bulls should be able to push the stock market higher for another higher high. Bulls need UTIL above 709 and CPER above 17.18. If either the utilities or copper do not move above these levels, the rally has no legs and will crumble and fall apart. If at least one of these parameters turn bullish, that will support the relief rally moving forward. Copper futures are down -0.7%.