The stick of stock market dynamite grows longer during this unprecedented top identified by the low put/calls (signaling rampant complacency and euphoric bullishness in the stock market) and negative divergence in the SPX charts. That probably means when she blows it is going to cause serious damage. The fuse only has an inch remaining before igniting the TNT that will blow the stock market to smithereens. Blood and Roses.
Keystone can never recall a time where the stock market did not roll over and die after the low CPC put/call ratios within a couple weeks at least a month. Never. The CPC signaled complacency in May and we are in August still looking for the Godot top. It is a two-month top going on three months. The SPX charts remain negatively diverged agreeable to a significant and historic top occurring right now.
The daily King Donnie happy talk keeps the bulls buying especially the Joe Retail crowd. Also, the constant drum-beat of rate cuts with Treasury Secretary Bessent now calling for a 50-bip cut, and the ongoing AI hype, continue pumping equities higher especially tech stocks allowing the major indexes to eke out new record highs. What, Me Worry? as Alfred E Neuman would say.
It is all systems go for the downside going forward but someone needs to tell the stock market. Do not be surprised if you wake up any morning going forward and your world is rocked if you remain long. 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.
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