SPX S&P 500 Monthly Chart; Multi-Month and Potentially Multi-Year Stock Market Top At Hand if MACD Cooperates

This juncture is reminiscent of the end of April. All the chart indicators on the SPX monthly chart went neggie d identifying a major long-term top but there was one caveat. The MACD line topped out dead flat. This qualifies as negative divergence (price is higher) but the stock market may want to play around for another month or two with a jog move to firmly lock in the neggie d with the MACD undeniably sloping lower.

Whazzat? Whozzit? What did he say? That sounds like Greek to me. The Sound of Silence. Artists rarely receive accolades for singing cover songs and they never sound as good as the original. Disturbed received a thumbs up from Paul Simon about their rendition of the song; that would be a highlight of any music career. There is only one language that is universal worldwide among all peoples. Music. It is the only one. The words of the prophets are written on the subway walls, and tenement halls.

Anyhoo, the maroon lines above show the neggie d at the end of April that should have started the long-term smackdown. Alas, here comes the calvary with the AI albatross being hyped for the umpteenth time and also happy talk about the end of the Iran War pumping stocks higher. Equities stagger around these record highs and may have already placed the major and historic top this month.

Everything hinges on the MACD line (green circle). The SPX price prints a matching or higher high in June versus May so the indicators can be assessed for negative divergence to see if it is time to call the top. The red lines are set up just like the maroon lines were at the end of April. All the chart indicators are in neggie d, and the RSI and stochastics are overbot also wanting a pullback, except for that pesky MACD line. It is like herding kittens and the MACD line is not yet cooperating. If you squint, and blink a few times, the MACD line in that green circle is still sloping higher by a single hair. The bulls know how to stretch out a party.

But the above is background for your homework assignment. Obviously, you have to watch that green circle like a hawk on Monday and Tuesday. June ends at 4 PM EST Tuesday so this month's candlestick, and the MACD line, will be cast in concrete, and July trading begins on hump day when a new monthly candlestick will begin. Thus, mathematicians say thus a lot that is why Keystone was shunned by neighbor Karen and not invited to the block party, The Coverups showed up instead, the next 2 days tell you if the major top is locked in, or not. The bears have 2 days to turn the MACD line either flat or sloping down, and the top can be called, and the multi-month and multi-year spankdown will begin.

What happens if that pesky little MACD cat remains sloping higher. That means there are still a few fumes in the tank to take price higher again. However, considering that the universal neggie d had already displayed at the end of April and all those chart indicators remain negative, the POS can fall apart at any time. It is exciting stuff. It would be a good forecast to say the long-term multi-month and potentially multi-year stock market top is in and if not, it will be in July.

Just think, you are witnessing a major and historic top that will be talked about for decades to come. You are seeing it unfold in real-time and watching the top call come into view as it occurs. The next 2 days are bigtime important and the first candlestick for July on Wednesday will also reveal a lot about the chart.

Are you starting to understand why Keystone is telling all of you idiots, especially you young idiots, to get out of you long positions? There are many months of downside ahead for equities and considering that we are crossing over into the second half of the year, that weakness in stocks that will begin at any time should run at least into 2027. Probably anyone that bot stocks over the last couple years will be flat or have lost money a few months or a year from now. If you were smart, get out of your longs and let that dough sit in your brokerage account and enjoy the summer. Take a look at things in the Fall to see what happened. Let everyone else, especially the smart money, hold the bag.

Price violates the upper band so the middle band, that is also the 20-mth MA at 6486, rising sharply, is on the table, as well as the lower band at 5359 rising sharply. When stocks start falling apart, the 10-mth MA at 6971, and rising, soon to be 7000, is an early warning signal that the stock market is in major trouble. If the 12-mth MA at 6876 and rising, call it 6900+, fails, equities fall into a cyclical bear market when historic damage and carnage will occur.

This is fun. When do you get a chance to see economic and stock market history occur right before your eyes in real-time? Watch that MACD line. The Strokes have a new one out called Going Shopping with Julian going overboard with the AutoTune. 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.