Are you girding your loins? If long, you should be girding night and day. If you are bullish on the stock market, that means everyone reading this since the only bears remaining are Slim and None and Slim just left town, you need to be very scared.
Comically, or historically if you prefer, the Aroon's on the SPX 2-hour, daily and weekly charts all show 100% of the bulls expecting stocks to go up forever and 100% of the bears expecting stocks to go up forever. If memory serves, that has never happened. The stock market bullishness is off the charts and over the top. Traders and investors are in a euphoric ecstasy for stocks willing to buy any equity with a heartbeat. The Aroon's indicate rampant stock market complacency and fearlessness. The CPCE put/call ratio falls to multi-year lows indicating rampant stock market euphoria, complacency and fearlessness. Sell, Mortimer, Sell!
Last week had Black Monday potential as noted in the last SPX charts. The stock market was topped out and ready to Rock and Roll to the downside a month ago but was stick-saved by the Fed speak and happy inflation and jobs data. Well, that hype is built into the charts now and the SPX is topped out again in the 2-hour, daily and weekly time frames. The stock market is a piece of sh*t ready to receive a negative divergence smackdown. That would be cool to see a Black Monday, or Black Tuesday; you would live stock market history in real-time.
The charts are horrible. As price makes an all-time record high at 5822.12 and all-time closing high at 5815.03, all the chart indicators on all three charts show negative divergence; it is a top. Keystone's 80/20 Rule says 8's lead to 2's on the way up so 5780 opened the door to 5820, which occurs. It is critical for the bears to knock the stock market down from here forward since a sustained price in the 5800-5820 area will open the door to 6200. Many Wall Street analysts have adjusted targets higher to 6K and more as stocks refuse to go down.
The rising wedge patterns are textbook and forecasting a top. The SPX is above the moving average ribbons requiring a mean reversion lower (like July). The pink boxes for the ADX show that the strong trends higher in stocks in the daily and weekly time frames are over. Fini as they say in Fraunce. Stick a fork in it. It's cooked.
The upper bands are violated so the middle bands, that are also the 20 MA's, are downside targets. On the 2-hour, they are 5766 and 5699. On the daily, the downside targets as per the standard deviation bands are 5721 and 5622, and they are 5535 and 5235 on the weekly.
The standard deviation bands on the daily chart are the tightest since June so a sharp strong move is expected over the coming days and weeks. Tight bands do not predict direction but the assumption is clearly down due to the universal neggie d across three time periods.
When Federal Reserve Chairman Powell sings, "the time has come," in Beds Are Burning, he did not mean it was time for an easing path to proceed, he meant it was time for stocks to collapse.
As usual, Keystone is sitting Alone on one side of the boat, strumming his guitar, singing an outlaw love song, the Story of My Life, while everyone buys stocks without a care in the world. They be stupid people. Everyone will come over to this side of the boat once the band begins to play when the neggie d kicks-in. Maybe a Black Monday? Black Tuesday? Bueller? 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.
ATTENTION: A salute to the US Navy on its birthday tomorrow (Sunday). Cher always knew how to entertain the sailors and make sure they knew what they were fighting for. If I Could Turn Back Time. Cher's son, Chaz, is playing guitar; we knew him as Chastity decades ago during the Sonny and Cher Variety Show.
Note Added Sunday Evening, 10/13/24, at 6:34 PM EST: S&P futures are down a handful of points. No biggie. Move along, move along. CNBC commentator Michael Santoli proclaims, "S&P 500 grinds higher to further record highs, finding little to fear in October." Yahoo Finance reporter Josh Schafer talks to Wall Street strategists and says they "believe the bull can keep running wild......the path higher appears to be clear, with earnings growth expected to keep accelerating and the economy on seemingly solid footing as the Federal Reserve cuts interest rates." It sounds like rainbows and puppy dogs every day ahead. BMO's Brian Belski decrees that the SPX will tag 6100 by the end of the year (within 52 trading days; the SPX would need to rally 5.5 points every trading day, with no down days, from now into 2025). Kris Kristofferson croaked a couple of weeks ago on a Sunday. How appropriate considering that Sunday Morning Coming Down was one of the best songs he wrote, that Johnny adopted for his own and made famous. Kris got taken back to the something that he had lost along the way. There's something about a Sunday. You can smell that fried chicken.
Note Added Monday Morning, 10/14/24, at 5:15 AM EST: Happy Columbus Day. The stock market is open but the bond market is closed. S&P futures are up a handful of points. No biggie. Nothing to see here, move along, move along. China decides to go incrementally with the stimulus doing a little, and watching data, then doing a little more, watching data; communist jackasses. Former Fed Chairman Bernanke, the so-called 'student of the Great Depression', learned from his studies that the major mistake after the 1929 stock market crash was not stepping-in and providing stimulus big and fast. That is why Helicopter Ben was dropping piles of cash from the sky in 2009 to save the stock market and protect America's corrupt wealthy class perpetuating the crony capitalism system. It worked. It sinks the US into deeper debt and straddles your kids and grandkids with unmanageable debt but who cares? Live for today. Don't worry about tomorrow. China is making the same mistake the United States made after the 1929 crash that led into the Great Depression, and sick 1930's decade, and then WW II in the early 1940's. Markets were ecstatic last week on China stimulus thinking it was a no-brainer that the PBOC would fire a gargantuan money bazooka showering the entire mainland, as well as the world, with easy money as far as the eye can see, but the communists balk. As world economies struggled in the early 1930's, protectionism took hold and the countries, including the US, slit each other's throat, all riding the same recession/depression bus to Hell until Hitler rose to power in Nazi Germany and WW II started. Oil and copper retreat on the lackluster China stimulus. Invesco's Brian Levitt proclaims, "I think we are in a bull market." For now, all is groovy, 'it's all too beautiful', and it is time for another fun day at Itchykoo Park.
Note Added Monday Evening, 10/14/24, at 7:09 PM EST: What's going on? That is not a Black Monday; it is a mini melt-up Monday. Well, how about a Black Tuesday? Emperor Jensen waved the Blackwell chip in the air again proclaiming limitless demand. The chips sector jumps a couple percent taking stocks higher. Banks are buoyant ahead of GS, C and BAC yearnings in the morning. Traders expect the banks to blow-out earnings like last Friday, especially after the bar was lowered which is the standard fare for the Wall Street game, so investors are tripping over each other to buy stocks at the ask with both fists. The SPX gaps-up this morning and prints a new all-time high at 5871.41 and new all-time closing high at 5859.85. Stocks are on Top of the World. Nothing has changed in the charts; the neggie d remains in play. The RSI on the daily chart creeps higher over the last two weeks so it may try to force price to jog for two days (down tomorrow and then up on hump day for the potential top). VIX remains elevated near 20 at 19.70 so expect big intraday price moves and day to day moves. S&P futures are up +3 as the banks cook the books in the backroom ahead of earnings in the morning. Keybot the Quant remains long and is tracking copper as the most important metric currently impacting stock market direction. If copper futures drop about -1%, the stock market will likely be in trouble so keep a hairy eyeball on the red metal. Copper futures slip negative a few minutes ago.
Note Added Wednesday Morning, 10/16/24, at 4:38 PM EST: Whoopsies daisies. The SPX retreats to end up where it started the week sitting at 5815. What the semi's giveth on Monday, they taketh away on Tuesday. ASML soiled the sheets. The bullish happy talk continues. Bears are as rare as hen's teeth. On Bloomberg, HSBC's Max Kettner remains a raging bull for US equities. On CNBC, Ritholtz Wealth's Josh Brown decrees that stocks are in a bull market with different superstars stepping-up each day. Bespoke's Bill Hickey proclaims that stocks will go up into year-end. A BAC survey reports that investors are the most bullish in 4 years and the overwhelming majority believe that a recession will not occur. BAC says the Fed's rate cut path and China stimulus create optimism that the stock market can only move higher. It is fun to watch. Wall Street analysts are tripping over each other to raise their SPX targets near or above 6K for this year. Stocks actually remain erratic and unstable. Stocks may float higher today into the peak of the full moon that occurs tomorrow morning at 7:26 AM EST. Yesterday's pull back may be the start of the multi-week slump ahead for stocks, if not, the SPX should peak-out any day forward due to the universal neggie d across the hourly, daily and weekly time frames. Git while the gittin' is good. Let it Drop.
Note Added Wednesday Evening, 10/16/24, at 6:40 PM EST: The plot thickens. Buoyancy occurs in stocks under the light of the super moon. Are you ready to call the exact top? We can give it a shot and you can follow up tomorrow and Friday to see how things play out. The SPX charts remain neggie d across the 2-hour, daily and weekly time frames so a spankdown is on tap that leads into a multi-week pullback for equities--as everyone and his bro are triple-leveraged long expecting a huge rally into year-end. Bring up the SPX 2-hour chart. See how price is moving higher today to end the session at 5842 only 18 points shy of the 5860-5870 area that would qualify as a matching price high? Note that if price makes this gain tomorrow morning, it is extremely likely that all the chart indicators (RSI, MACD, histo, stochastics, money flow) will remain neggie d, hence, the top would be locked-in at the time the SPX printed the 5860-ish and higher; you can call the top. Simply watch the chart to make sure it plays out that way. The other outcome would be for stocks to simply begin dropping now and begin the multi-week down move. The 2-hour stockcharts.com charts print candlesticks at the open at 9:30 AM EST, then 10 AM, then 12 PM (munch time), then 2 PM. Rinse and repeat the next day. Thus, let's get cute and say the SPX will rise tomorrow morning (Thursday) and hit the 5860-5870 range within the first two candlesticks so the top in the US stock market will likely occur between 9:30 AM EST and lunch time (noon). The 2-hour chart will tell you. Then you will have a top call under your belt and you will understand the power of neggie d. The bull party continues and becomes more comical each day. Evercore ISI's Julian Emanuel remains committed to SPX 6000 by year-end and his only worry is a contested US election in November. Truist's Keith Lerner decrees that even if hiccups occur in the stock market, the underlying trend will remain positive (up and away). He is still positive on tech stocks and sees no AI bubble. Lerner expects stocks to move higher with earnings moving higher. UBS strategist Jonathan Golub raises their SPX target to 5850 this year and 6400 for the end of next year. Barclays is at 6500 for next year. Pause for laughter. CFRA's Sam Stovall says earnings are expected to keep growing so that means blue skies and rainbows for stocks. He says stay with the winners such as NVDA and MRVL. CNBC commentators are sitting around a table one trying to out-bull the other; they all sound like bull-sh*tters. Tim Seymour proclaims that stocks will move higher into year-end. The Bible says the Lord found it difficult to find a righteous man probably just as difficult as finding a bear on Wall Street. Watch the SPX 2-hour chart; Thursday (tomorrow) should be the top for the stock market followed by many soggy weeks. The US presidential election is 11/5/24 that may add drama as the SPX should be slumping away as the votes are cast for either King Donnie, the orange-headed bloviating carnival clown, an adulterer selling Bibles, or, Cackling Kamala, a progressive interview-challenged wannabe communist. Go for it if you think voting for one criminal or the other is important.
Note Added Thursday Morning, 10/17/24, at 4:54 AM EST: Morning Has Broken on the US East Coast as Cat Stevens, now Yusuf, sings, and the S&P futures are up ..... wait for it ...... wait a bit longer ..... 18 points. If you are bearish the stock market, you want this to occur as explained above. The SPX will print a matching high and the chart indicators will all be out of gas and sloping lower on the 2-hour chart, negative divergence, neggie d, and the top will be in. If a bull, you want price to rally strongly higher today, say, 30, 40, or 50 SPX points or more which can extend the top into early next week (putting off the inevitable). Bears are happy with a rally of 20, even 30 SPX points after the opening bell, to lock-in the top with neggie d. Perhaps today will be a top in the US stock market that we will not see for many weeks, months, and perhaps years forward? It should be an interesting day ahead. S&P futures now up +21 points. The bulls are busy throwing darts at the stock pages to decide what tickers to buy today since everyone, including the doorman, Uber driver, shoeshine boy, and masseuse at the country club, believe that the stock market will go up forever going forward. Irving Fisher's ghost from 1929 says we are at a permanent plateau in the stock market and will only go up, and not down, from here. What do you say?
Note Added Thursday Evening, 10/17/24. at 7:19 PM EST: Robert Smith sings, "Thursday, I don't care about you, it's Friday I'm in love." The stock market top occurs at 9:30 AM EST with a new all-time record high at 5878.46, call it 5878. The top occurs as described above, before it happened. Watch for follow-through to the downside tomorrow, if so, the neggie d spankdown and multi-week slide in US stocks has just begun. The Keybot the Quant robot remains long but has been champing at the bit for 3 days to flip short but the internal parameters will not yet fully latch to permit the move. Maybe tomorrow is the day when the bulls, at the peak of stock market ecstasy, and only six feet from the edge, will take One Last Breath. With all the talk of Black Monday and Black Tuesday, Keystone forgot all about Black Friday. You know, it is still October.
Note Added Tuesday Morning, 10/22/24, at 6:16 AM EST: There were no black days last week. Yesterday, Monday, begins with a 'blackish' Monday. The SPX drops to 5824 but recovers finishing at 5854. The bullish cheerleading continues unabated. Sanctuary Wealth's Mary Ann Bartels proclaims, "We can still go up. We are in a secular bull market......and this may last 15 years. We are going into a super cycle (of growth)." Bartels decrees a SPX 6K target this year and 7K within the next 12 to 18 months. What is she smoking? That must be some good stuff. Pass it around to the rest of us. She's seeing things. The SPX is more likely to be in the 2K to 4K range a year from now than 7K. Citi analysts must be paying attention to Keystone's work because this morning the investment bank proclaims that stock market valuations are excessive and each time they reach these levels, a -10% correction typically follows. S&P futures are slipping away this morning down about -30 points. The 2-year yield is over 4%. Maybe a Black Tuesday? There are 8 more trading days remaining in scary October. Keystone is getting his Halloween costume ready for the town parade and received complements on his ugly mask but unfortunately, he was not wearing one.
Note Added Friday Morning, 10/25/24, at 5:05 AM EST: The SPX prints the all-time high at 5878 on 10/17/24 and then receives the neggie d spankdown dropping to 5784 two days ago now at 5810. Price is trying to hold the 20-day MA support at 5787 but that will fail as the neggie d smackdown continues. The 50-day MA support at 5677 is building strong support with the late September early October price support at the 5680-5700 range. VIX 19.01. The bullish euphoria continues. TSLA earnings are a beat and the stock pops +22% with investors tripping over each other to buy the maker of the glorified golf carts (EV's). CNBC commentator Jim Cramer predicts a bottom in stocks and a buying opportunity in two weeks from Wednesday which is 11/6/24. Why would anyone put a date on a bottom? Simply watch the SPX weekly chart and the bottom will be in when all the chart indicators positively diverge. The US presidential election may create turmoil but the expectation remains for a multi-week move lower for stocks.
Note Added Thursday Evening, 10/31/24, Halloween, at 7:00 PM EST: The SPX drops 108 points, -1.9%, to 5705 today with a LOD at 5702.86. We can call that a mini-Black Thursday. Is Mercury in Retrograde as Sturgill sings? It is Halloween this evening and the new moon peaks tomorrow. The Monster Mash is the Halloween Anthem. The Jobs Report is on tap tomorrow morning at 8:30 AM EST and will set the tone. The neggie d spankdown continues. All the bullish cheerleaders above that liked stocks at SPX 5878, the all-time high, must love them at SPX 5705. The 50-day MA is 5699 so price bounced off this critical support on the first near-touch. For the daily chart, you see price fall out of bed today and all the chart indicators are weak and bleak, so the chart wants lower lows in price on the daily basis going forward. The Jobs report and other drama may sends stocks to and fro but the daily chart is weak. The SPX 2-hour is starting to set up with possie d so look for a bottom in stocks late morning or perhaps after the Jobs Report. So Friday and Monday may provide buoyancy in stocks but price should roll over again and head lower to satisfy the weak and bleak daily chart. The 20-wk MA is 5601 so that 5600-ish may serve as a bottom on the daily basis in early November. Simply watch the hourly and daily charts and you can call that bottom. That will send stocks higher on the daily basis but the weekly chart will likely remain weak and bleak so after that rally on the daily basis, say into late November, or December, that will be a top and then the multi-week slide lower will kick back into gear for more lower lows in the SPX in the weeks ahead and into the new year. The charts will tell you the timing. There is lots more downside fun ahead and you can Sing Along with Sturgill.
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