SPXA150R S&P 500 Stocks Above 150-Day MA Daily Chart; Toppy Behavior; Expansion Pattern

Two indicators that are extremely reliable in forecasting are the SPXA150R and NDXA150R. Keystone calls them the 'bet-the-farm indicators' (on the short side). When SPXA150R or NDXA150R moves above 90%, you have to have shorts on and should be throwing longs out the window. If these indexes tick higher to 92, 94, even higher, bet the farm on the short side! You will make a bundle.

Keystone previously posted the NDXA150R chart highlighting the uber high at 94.00 on 10/12/20 and 10/13/20. That was the top-tick for tech stocks. The NDX fell -10.1% within 3 weeks after that top that day was signaled by the NDXA150R. The COMPQ dumped -9.4% within 3 weeks after that 94.00 top-tick. So 10K investment produces 1K profit within 3 weeks. The indexes then come all the way back up again on the vaccine hype and analysts calling for the SPX to be above 4,000 in a few short months. The NDXA150R now prints 87 on 11/16/20, last Monday, which is another uber high reading and agreeable to seeing stocks tumble lower.

Interestingly, the NDXA150R tops out mid-October but the SPXA150R above comes up for a higher high now printing an uber high 89.98 on 11/16/20; let's call it 90 since it is close enough for government work. This is a very attractive place to short from. So far, the SPX falls from 3629 to 3544, a -2.3% retreat, and receives a bounce. The expectation is for far more downside. This behavior between these two key market timing signals tells you that tech stocks have topped out first and the broad stock market is following along next.

If you were trimming longs last week and bringing on shorts you receive a gold star. If you shorted the market on the SPXA150R top-tick at 90, you receive a gold star and receive applause from your classmates.

If you remain stubbornly long, not selling any positions last week while shunning shorts, even making fun of young Timmy Trader that says sentiment is too euphoric, valuations are too high and the charts are setting up ugly for the months ahead, you receive a dunce cap and must sit in the corner until further notice, or until you are wiling to sell some longs and put on some shorts. We are likely in the big-picture end game now. Traders and investors have full confidence and religious belief in vaccines, central banks (the four central banker horsemen of the financial apocalypse; Fed, BOJ, ECB, PBOC) monetary stimulus and US government fiscal stimulus going forward, What could possibly go wrong?

The high 90 reading for the SPXA150R makes you very comfortable in holding short positions. Even if stocks rally for another day or few, the SPXA150R will come up to 90+ to verify that you should remain short. The red circles above show the prior two tops and now. What do you think will happen? The expansion, or megaphone, pattern is highlighted with the blue lines. 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.