Goodnight Irene, Irene Goodnight, by Leadbelly. It has been a multi-week slog waiting for the historic top to finally arrive; it is the Godot Top. The SPX weekly chart officially tops out with negative divergence (red lines). That pesky MACD created the last month of buoyancy in equities and stubborn stocks that refuse to roll over. The MACD is now neggie d (price makes a matching or higher high but the chart indicator is sloping down).
The overbot conditions, rising wedge vibe, and upper band violation are bearish indicators. Price will want to seek the middle band, that is also the 20-wk MA at 6505, sloping sharply higher, and the lower band at the 6116 palindrome, sloping sharply higher, is also on the table. It is time for the multi-week pullback in stocks to begin.
The ADX pink boxes show the strong trend higher in early and mid-2024, that petered out, and then tried to reexert itself this springtime, but failed. Despite the all-time record highs in stocks (all-time high at 6920.34 on 10/29/25 and all-time closing high at 6890.89 on 10/28/25), the ADX is not impressed and no longer considers the stock market rally a strong trend higher.
The Aroon verifies the rampant euphoric bullishness and complacency in the stock market. Traders want to buy all dips and believe that stocks are at a permanently high plateau a la Irving Fisher in 1929. Everyone is drinking the King Donnie, Pope Powell and AI wine, but they do not know that it is sacrificial wine.
Plan accordingly for a few weeks of downside in stocks. The Keybot the Quant trading robot is on the short side currently but is tracking banks and copper as the main metrics impacting stock market direction. XLF, banks, are weaker so the bears are happy. The quant identifies a -0.4% loss in copper futures today as a serious failure that will lead to lower stocks. Copper is flatish so stocks are buoyant. Overnight, futures were higher and then when copper futures slumped to down -0.4% today, boom, futures dropped. Doctor Copper will tell you the story over the next couple days. If you are bullish and plan to hold longs, get on your knees and start praying for the red metal.
Keystone has described the topping drama over the last few weeks. There were many stick-saves by King Donnie and Pope Powell as well as pumps created by AI hype and inflation data. There will be more happy talk but most of this stagecraft has run its course. Maybe the Ukraine War would end or something great like that would send stocks higher but that does not appear on the horizon.
Keystone is holding index shorts that are flat or down currently and as mentioned the Keybot the Quant trading robot is short. The next couple days will be interesting. The full moon is big and beautiful very close to planet Earth this time around. There is a Bad Moon Risin'. The end is coming soon. Hope you got your things together. 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, 11/6/25: SPX 6720.
Note Added Thursday Evening, 11/20/25: The broad stock market sells off for a few days and takes the pipe today with the SPX dropping down to 6538.
Note Added Saturday, 11/22/25: The SPX drops to 6521 intraday Friday and then ends the week at 6603.
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