SPX S&P 500 Monthly Chart; US Bear Market Continues; Lower Band Violation; SPX Low of the Year Thus Far is 3491.58; SPX Testing 50-Month MA Support at 3536

As previously explained, the SPX daily and weekly charts want to see the stock market rally going forward. A multi-week rally is likely starting as long as news from the Federal  Reserve or elsewhere does not delay the relief rally. Stocks moving higher for a few weeks is ST and intermediate-term time frames. After a few weeks, stocks will roll over again. What does the SPX monthly chart predict for the long-term? Are you sure you can handle the truth? You can't handle the truth.

The chart above is ugly. Keystone called the exact top at the start of the year; remember al the drama with the MACD peaking-out? It was nothing special. It was simple due to the neggie d, overbot conditions, price extension above the moving average ribbon, stalling strength of uptrend, a fading pump on ST fiscal (Congress) and monetary (Federal Reserve) stimulus, upper band violation and rising wedge. Easy-peasy.

So down we go and comically everyone wants to now know where the bottom is. Even funnier, stupid people ask the same clueless money managers that were not smart enough to tell them they are about to lose a ton of money starting January in the first place. Right away on the chart, you see the weak and bleak MACD, histogram, stochastics, money flow and ROC. These indicators tell you that the ongoing bear market is going to be around a long time.

One of Keystone's key overall stock market signals, perhaps the most important indicator of all, is the SPX 12-month MA cross. When price lost the 12-mth MA, it was lights out, the Party is Over. This signals a bear market for the US stock market and it will not end until the S&P 500 is above the 12-mth MA now at 4171.

Picking apart the price action in more detail, the SPX has fallen quite a ways off the top and needs a rest. Price violates the lower standard deviation band so a move back to the middle band, also the 20-mth MA, at 4227, is on the table. That would be one Hell of a rally for a few weeks.

The SPX is battling at the 200-wk MA at 3599 and, as the chart above shows, the 50-mth MA at 3536. The stock market is ping-ponging through 3536-3599 deciding to bounce or die. Bulls win big above 3599. Bears win big below 3536.  The low for the year thus far printed last week at 3491.58.

As mentioned, the SPX weekly chart wants to run higher. Remember, in technical analysis you are playing multi-level chess where the time periods are the playing boards. The RSI is flat above (green line). This is considered positive divergence since price continues lower but the RSI is flat. This metric will marry itself to the possie d on the weekly chart and reinforce the idea that a multi-week relief rally is at hand. Ditto the stoch's that are weak and bleak wanting lower lows on price going forward, on the monthly basis, but at the same time are oversold and agreeable to a relief bounce in price.

So the next few weeks look good for the bulls but likely as the year ends and 2023 begins, the stock market is going to fall apart and potentially go into freefall. As previously explained many times, the utilities collapsing is a huge negative for the stock market and places it in a crash profile currently. It is historic stuff happening in real-time.

Keystone calls May 2015 the last legitimate top in the stock market. Everything that has occurred afterwards is garbage so do not be surprised if you see 2K over the next year or two (a retreat to the 200-month MA and undershoot).

For now, if you are bullish, a relief rally is at hand on the weekly basis. However, after that runs its course, and you will know for sure when neggie d forms on the weekly chart, the monthly chart negativity will reexert itself and she will start going down hard again perhaps starting in the Thanksgiving to New Years Day holiday period. First things first. First, a relief rally should occur on the weekly basis say into November and Thanksgiving and then roll over lower for down, down, down December through March. Of course the SPX weekly and monthly charts will refine this analysis as each day plays out. 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 Tuesday Morning, 10/18/22, at 4:18 AM EST: The S&P 500 rallies a big 95 points, +2.7%, on Monday to 3678. S&P futures are up +63 more points this morning. The SPX is testing the 20-day MA at 3685 where it is bounce or die time. It looks like price plans to blow up through and continue the rally. The critical 200-week MA support at 3606 and 50-month MA at 3538 hold over the last month providing hope for bulls that a relief rally has started. The 20-week MA is at 3896 and descending (this was mentioned as a logical upside target in the previous SPX weekly chart post; the lower band was violated on the weekly chart so a move higher to the middle band, which is also the 20-wk MA, is on the table). The 50-day MA is 3924. That is a logical upside target range, call it 3900, as long as the Fed remains quiet and there is no negative news. The first test of the fledgling stock market rally is the 20-day MA at 3685 so focus on that today. A close above will extend the rally higher.