The trouble with the utilities continues a harbinger of doom and gloom for the United States stock market. Utes are key as per Norm Fosback's technical work decades ago. As Keystone has explained many times, most recently with the 2/20/23 trap-door and 3/2/23 UTIL charts, the 50-wk MA and the weekly uptrend dictated by the closing price 15 weeks ago are the two key parameters. When they fail, the stock market will begin collapsing bigtime either coincidentally or within 2 months. Trouble, as Ray laments.
The 50-week MA is at 967 moving sideways lower. Price is down at the 909 palindrome a far way away from 967. The blue circle shows the closing price from 15 weeks ago and with price down at 909; the utilities are obviously in a weekly downtrend which is bad news for US stocks.
You can do the 15-week lookback comparisons on the chart to see that the weekly downtrend started 4 weeks ago. Thus, both utility parameters are negative for a month so the stock market is in prime shape to begin dropping a huge way. The utility negative signal is not for a run of the mill pullback in stocks. It is the big enchilada, the kahuna; it tells you that a really big move lower for stocks is at hand.
If you want to remain bullish and not lose your money during the weeks ahead, you desperately need UTIL to regain the two metrics above as fast as possible. The purple box shows that all the closing prices that will be used for the 15-week lookback and trend assessment are above 960. The 50-wk is 967 so take a big purple crayon and draw a thick line across the chart at 960-967. Keystone likes purple crayons because they taste the best.
The chart indicators are mixed. The oversold and possie d stochastics create the rally in utes last week but the MACD and money flow remain weak and bleak preferring to see more soggy prices ahead.
The low CPC and CPCE put/call ratios verify the excessive complacency and fearlessness in the stock market. Traders, analysts, pundits and the shoeshine boy are all worried about stocks proclaiming fear but 10 minutes later they are buying stocks. This behavior jives with the utes and forecasts some serious gloom and doom ahead.
With Powell on tap, stocks may rally strongly which will create great opportunities to short into, or, Jerome may lay an egg today and begin the pending market turmoil. Bulls must focus on UTIL above 960 like a laser beam it is the only way they can save the day and prevent blood and carnage over the next few weeks.
The failure with utilities indicate that the SPX is going to fall a long ways from current levels for several weeks forward (hundreds of points lower). Keep your guard up. Be nimble my friend. Like water. 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, 3/23/23, a palindrome day, 32323, at 8:10 AM EST: UTIL collapses to 890. That's ugly. Goodnight Irene, Irene goodnight.
Note Added Friday Morning, 3/24/23, at 4:05 AM EST: UTIL collapses to 882 with a LOD at 877 not seen since last October 5 months ago. It's All Over Now Baby Blue.
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