SPX S&P 500 Monthly Chart with 12 MA Cross; 1-Year Cyclical Bear Market Being Tested

The stock market bears had lots of fun in 2022 riding the cyclical bear market south. The bulls are making noise, however, and threatening to overtake SPX 4036-4040 unleashing an upside orgy in stocks so obscene it would make Caligula blush. The SPX begins today at 4016 about 20 to 25 points below the significant bull/bear line in the sand.

The SPX 12-month MA is the single-most important technical metric of the US stock market. It tells you if stocks are in a cyclical bull or bear and tells you how your portfolio should be balanced and weighed.

Adding to the drama are two other metrics that are now identifying a cyclical bull market in progress going forward. The NYA 40-week MA cross was first to turn bullish signaling a cyclical bull market. Next, only a couple days ago, the slope of the SPX 150-day MA begins moving higher signaling a cyclical bull market ahead.

2 of the 3 metrics dictate that a cyclical bull market has started but King Daddy, the SPX 12-mth MA cross, is not there yet. Since the cyclical bear market is ongoing for the last year, the benefit of the doubt must be given to the bears still yet. The gamechanger would be if the SPX takes out the 4036-4040 resistance gauntlet.

The SPX tested the 12-mth MA at 4036-4040 on Monday but was spanked down. This behavior typically sets up another attack or two of the coveted 4036-4040. The days ahead and couple weeks will tell the tale.

If the SPX fails to signal a cyclical bull market over the next couple weeks and starts trending lower, watch the NYA 40-wk MA cross and the SPX 150-day MA slope. If either of these revert back to a cyclical bear that tells you that the US stock market is going into a crash profile. If the SPX loses the 10-mth MA at 3952 shown above, that spells major trouble for stocks. Don't worry. It will be fun. You simply have to make sure you are holding shorts.

For now, however, the bulls are puffing their chests out proclaiming that they can defeat the 1-year cyclical bear market. Can they? The next couple weeks and 4036-4040 will provide the answer. 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 5:18 PM EST: The SPX explodes higher blowing up through the critical 4036-4040 gauntlet in an upside orgy so obscene it does make Caligula blush. The SPX 12-month MA is at 4038 so that is the exact number to focus on. This is such a critical level that price will likely play around here for a while. The SPX will need to come down for a back kiss at 4038 and it will make a bounce or die decision then so there is still some drama to play out before the cyclical story is told. As of tonight, the US stock market has returned into a cyclical bull market but give it a few days since it may chop above and below 4038. Price also blew up through the 50-wk MA at 4031 another bigtime number that will likely need a back test. The bulls are walking around with their chests puffed out. All you have to do is watch SPX 4038 (4031-4038) and know that it decides the future direction of stocks.

Note Added Monday, 1/30/23, at 12:00 PM EST: The SPX 12-mth MA is at 4038 and the SPX price is at 4038. The battle continues.

Note Added Tuesday Morning, 1/31/23, at 9:00 AM EST: SPX drops to 4018 in the Monday session. Bears cheer.

Note Added Tuesday at Munch Time, 1/31/23, at 12:02 PM EST: SPX pops to 4044. Bulls cheer.