The privileged elite and upper middle class sycophants that service the wealthy, dance with glee at the never-ending riches they accumulate especially during the last 15 years of Federal Reserve money-printing. YAHOO! They Celebrate with Kool and The Gang cheering America's crony capitalism system as the rest of the country looks on cooking their meals, cleaning their sheets and scrubbing their dirty toilets.
There has not been this wide a separation between rich and poor in America since the 1970's and many of you were not even alive then. That's your loss since the music was great in the 1960's and 1970's. You missed out. San Francisco. Summertime was a love-in there. Those were the days. Now the US is the land of the have's and have-not's again and Dow 40K is for the have's. Did you know that one-half of Americans do not own a single share of stock? No, you didn't.
Enjoy the Dow 40K newspaper and internet headline this week since it should not last long. The chart is a turd floating in the bowl. The only people that should be happy about the sick chart above are the screen printers providing the Dow 40K hats.
The rising red channel is in play for the last decade with price now bumping its head up against the top rail which places the bottom rail at 32K-33K in play going forward on the monthly basis. Price prints a matching or higher high for March, April and now May, so the indicators can be assessed for potential negative divergence. The red lines indicate neggie d across all indicators an extremely bearish indication going forward and remember this is a 'long-term' monthly chart.
The RSI is neggie d across the last 6 years and now over the last 3 months. Ditto the stochastics that are also overbot agreeable to a pullback. Ditto the histogram. The MACD line is neggie d over the last couple years, as price ventures higher for new all-time highs, showing that the fuel tank for more upside is empty. Ditto the money flow but both show a spurt of life with slightly higher highs over the last couple months. Those short green lines represent the ongoing momentum and upside market hype.
Price has violated the upper standard deviation band at 40K+ so a move back to the middle band, that is also the 20-mth MA, at 35358, and the lower band at 30509, are on the table going forward on the monthly basis.
The ADX is down at 16 showing that the big upside rally this year is NOT a strong trend higher. That is not what you hear in business media with one analyst or trader after another proclaiming nothing but blue skies, rainbows, hugs, flowers and kisses ahead. Instead, it is called pump and dump. The analysts and traders are telling Joe Sucka, Jane Winedrinker and Frankie Sixpack that the sky is the limit because they are unloading their shares onto these willing bagholders. You can get people to do anything if you play to their human greed. The blue circles show distribution months three of them over the last year. This is the bigtime smart money dumping shares off to Joe Sucka and Jane Bagholder.
The pink box shows that the last time the Dow Jones Industrials had a strong trend was the rally higher during 2017-2018 that then petered-out in early 2019. As price makes higher highs for the last few years, the ADX moves lower the exact opposite of what you want to see if you are long the market. In other words, as stocks rally to more all-time highs, the ADX tells you that it is not only NOT a strong trend higher for stocks but the trend higher is weakening.
The Aroon green line shows that 100% of the bulls remain 100% bullish the stock market believing stocks will go up forever. In addition, the Aroon red line down at 24 shows that the bears have given up and they too believe that stocks will go up forever. These are contrarian signals against the stock market. The Aroon tells you that everybody and his bro are long stocks and believing that prices will grow to the sky forever. You know what happens when everyone is on one side of the boat partying like its 1999? They will end up hungover. During the holidays near the end of this year, with stocks still in retreat, people looking at their sagging stock statements will be baking cookies that are placed in tins for frugal Christmas presents.
The chart is a piece of crap. The Dow 40K all-time high is good news only for people that own stock and are long the market. One-half of the country is left behind with their noses pressed against the front window of the fancy restaurant watching the have's snacking on caviar and sipping fine wine. The wealthy and upper middle class send thank-you notes to the Fed for maintaining easy money policies that have made them all filthy rich (and supporting the current bifurcated economy). The middle class, that is now defunct with these folks falling into the lower middle class, poor, elderly, handicapped, single Mom's, and homeless, the have-not's, suffer mightily under the weight of crony capitalism.
All of you long-time followers of Keystone remember how he calls the May 2015 stock market top the last legitimate stock market top. The case could still be made that fundamentals and technicals mattered back then but as the Federal Reserve went full-blown nutso printing money like crazy, the stock market launches higher rocketing to the moon. This is not capitalism, folks. It is filthy crony capitalism, trash, be glad that it is in its last throes.
The expectation is that after a couple years of falling stocks and sogginess, the Dow Jones will return to Earth which is a landing target in the 16K to 22K zone. Enjoy the Dow 40K but like beauty, nothing lasts forever. Benny. 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.
HAPPY ARMED FORCES DAY TO ALL YOU VETS. Cher knew how to keep the boys happy when overseas letting them know what they are fighting for. If I Could Turn Back Time.
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