SPX S&P 500 Monthly Chart; Battle at 12-Mth MA at 3962 Testing the 1-Year Cyclical Bear Market

The saga with the SPX monthly chart continues. The 10-mth MA at 3928 and 12-mth MA at 3962 are critically-important numbers. The 12-mth MA at 3962 dictates whether the US stock market is in a cyclical bull market or cyclical bear. The cyclical bear market is ongoing for the last year but the battle between bulls and bears started in December.

Price poked above the 10-mth MA in November which told you a test of the uber important 12-mth MA was likely, and it occurs in December, but is met with a strong spankdown. The bulls pick themselves up, and dust themselves off, as they put away the New Year's Eve party favors for next year, and push stocks higher again. January is a big rally month with the 10-mth again taken out so a test of the 12-mth resistance is on tap, and occurs, and price pokes up through.

Bulls are walking around with chin's high and chest's puffed, proclaiming a new bull market. Not so fast. After spiking to 4200, the SPX collapses back through the 12-mth MA stating that the 1-year cyclical bear market remains king.

Note how price comes down to tap on the 10-mth MA over the last 2 months and then recovers (the lower shadows of the candlesticks come down to tease the 10-mth). The bulls prevail on the back kisses (support holds) with price now poking back above the 12-mth MA at 3962 so a cyclical bull market is back on the table. March is a long month and a lot will happen over the next 4 weeks.

The battle continues. The utilities failed portending serious bad stuff coming down the pike for the US stock market, to begin at anytime over the coming days and weeks so the expectation would be for the SPX to fail through both of the moving averages again going forward.

The SPX fell to the 10-mth at 3928 yesterday for that back test of support and recovered strongly above the 12-mth MA at 3962 but most of the folks buying are robots and day-trader's. The US Monthly Jobs Report is next Friday, late this month, so Heaven help us if we have to endure another week of choppy slop until a firm directional commitment occurs. The whole year is chop suey so far chopping up bulls and bears alike especially those playing leveraged ETF's.

Also, watch the 20-week MA support at 3957 and 50-week MA resistance at 4002.

Bulls will rally euphorically above 4002. Bulls win big above 3957-3962. Bears will reexert their negativity below 3957-3962. Armageddon for stocks begins if 3928 is lost. 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.