SPX S&P 500 60-Minute Chart with 200 EMA Cross

One of Keystone's standard short-term signals is the SPX 60-minute with 200 EMA cross. Say what? What is this odd language he speaks? Tell this guy to speak English. You can see last Friday how the bottom fell out after the job report, gapping down and violating the 200 EMA at 6255 opening the door to a short-term bear market going forward.

Alas, the bulls eat their spinach and come to play Monday morning with the SPX gapping-up with a dip-buying orgy so obscene it would make Caligula blush. Traders were buying any stock with a heartbeat and the bulls win back control of the stock market with price back above the 200 EMA at 6255.

The SPX sits at 6299 so bears need 44 points and more of downside to show that they mean business. The bears should be thankful for the recovery move since it filled the orange gap from Friday morning. This buttons-up the topside and allows price to move steadily lower from here without worries about having to move higher to fill a gap. The gap from Monday will want to be filled and that would take place if/when price goes down for another test of the 200 EMA at 6255.

The 20-day MA is 6311 and price plays to and fro along this important moving average the last couple days. Thus, putting it all together, the 6299 price is below the 20 so the door is open for the SPX to drop and fill the lower gap and retest the critical 200 EMA at 6255. This behavior will dictate if a short-term bear market is locked-in going forward, or not.

If the SPX recovers back above 6311, the bulls will stick a thumb, er hoof, into the bears eye and not worry about any downside ahead. If 6255 fails, stocks will be falling like rocks. Are we going back to Rockville? Don't Go Back To Rockville. 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.