Having fun yet? King Donnie Trumpski has created the worst supply shock in global history with his war against Iran. Donnie was not ready for the drone warfare or the Strait of Hormuz closure spinning out of control. The US and Israel, with some Allies, are shooting at Iran and Lebanon, and Iran is shooting at its Middle East, or Western Europe as it is called by the people that live there, neighbors. Russia is supplying intelligence to Iran to target US assets. Ukraine is the top drone expert in the world due to the never-ending Ukraine War, that Trumpski was supposed to stop in 24 hours but he failed, and supplying this technology to Israel and the United States. Hey, do you know what? It sounds a lot like World War III.
And we do not even have Country Joe McDonald anymore; he passed away a few days ago. Woodstock. F war (harsh vulgar language). What are we fighting for? Don't ask me I don't give a damn, next stop is Vietnam. Be the first one on your block, to have your son come home in a box. And the world repeats.
Anyhoo, as mentioned in the past, two key metrics are the 10-mth MA at 6674 and the 12-mth MA at 6518. A drop below the 10-mth MA at 6674 is a warning signal that the stock market is in serious trouble and starting to fall apart. Old-timer's watch this number and many algorithms have it programmed into models so it is important. Price is at 6681 as this is typed lower than the 6698 on the chart but above the key 10-mth MA at 6674 so bulls are holding on by a single fingernail. If the SPX finishes today below 6674, and you are long the market holding on, you will get your pants pulled down going forward.
The low is at 6636 so the 10-mth was ruptured, perhaps weakened, you will have to watch. If the failure of the 10-mth sticks, next watch the 12-mth MA at 6518. This is where a longer term cyclical bear market begins. It signals lots of pain, misery and blood and carnage on Wall Street going forward. You know, fun times. Are you ready? At least you know what to watch. The 6674 is key today since price is sneaking around this level to and fro. One side or the other will win today and chart a path of happiness (staying above 6674) ahead or a future of doom and gloom (closing below 6674 trending lower to the 6500's). Ohio. Tin soldiers and Donnie's coming. It feels like Kent State all over again. 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 6:14 PM EST: The SPX drops to the 10-mth MA at 6671.84 at the closing bell. Of course it did. You could smell that one coming. Note that as price fell, the moving average calculation continues to adjust so the 10-mth MA sits at 6672 with SPX price at 6673. The LOD, in the last minute of trading, was 6670.40.Thus, the S&P 500 sits exactly at the 10-month MA warning signal at 6672-6673. Bounce or die. Tomorrow is a big decision day. Perhaps a Black Friday on Friday the 13th? The bulls will celebrate and throw confetti into the weekend if the SPX remains above 6672 heading higher. It hints that a relief rally is at hand The bears will rejoice if the SPX drops below 6672 since that is the go signal to start dumping stocks at a faster pace. The 12-mth MA is at 6516 that marks the start of a cyclical bear market. Lots of drama is ahead and the script writer's could not develop a better story line. The stock market pauses at a critical long-term line in the sand, the 10-mth MA at 6672, and the move from this level dictates the fate of the stock market ahead. The bulls and bears are in their camps preparing for a big battle at daybreak. A lonely harmonica echoes across the valley. Both sides listen to the sobering sound of Shenandoah and wonder if they will win, or lose their shirt tomorrow. Black Friday on Friday the 13th has a nice ring to it.
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