Saturday, April 25, 2015

SPX S&P 500 30-Minute Chart 8/34 MA Cross

The 8 MA is above the 34 MA on the SPX 30-minute chart signaling bullish markets for the hours ahead, however, price is under the 8 MA which will curl it downwards for a potential negative cross. Bears got nothing until they receive the negative 8/34 cross. The bears were in great shape last weekend with the 8 MA under the 34 MA but the Chinese pumped global stock markets higher with the bank triple R cuts last Sunday. On Monday, 4/20/15, stocks gapped higher and the central bankers save the day again as they always do. The red lines highlight the negative divergence that creates the initial spank down off the top.

The expectation is for a move lower for stocks going forward especially since the CPC put/call at 0.76 indicates uber complacency and a market top at hand. 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.

SPX 1-Hour Chart 200 EMA Cross Overbot Rising Wedge Negative Divergence

The bears were in good shape last weekend with the SPX under the critical 200 EMA signaling bearish markets for the hours and days ahead, however, the Chinese cut the bank triple R rates to goose the stock market and the bears were punched in the face to begin last week's trading on 4/20/15. The central bankers are the market. The SPX is above the 200 EMA on the 60-minute chart at 2091.44 signaling bullish markets for the hours and days ahead.

The red lines, however, indicate negative divergence across all indicators and the stochastics are overbot both wanting price to selloff. The CPC is down to 0.76 signaling uber complacent markets so a market top is at hand. The prior SPX 2-hour chart leaves the door open for a couple more hours of upside so if that occurs the purple path should play out with price printing once more in the apex of the rising wedge before rolling over. The blue path is the scenario where price simply begins selling off from here.

Watch the MACD cross, currently positive favoring bulls. If the MACD cross turns negative you will know that the bears are driving the bus going forward. As markets selloff, the bears got nothing unless they push price under the 200 EMA at 2091. When price approaches 2091 a critical bounce or die decision will occur determining the fate of markets going forward. 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.

SPX S&P 500 2-Hour Chart Overbot Negative Divergence

The SPX 2-hour chart is overbot with negative divergence (red lines). The MACD line is too close to call (is it flat or sloping higher or sloping lower over the last couple hours?) so the SPX may play around for another 1 to 4 hours before rolling over. The upper standard deviation band is at 2123 so if price does begin the week on the upside at 2118-2124 it is likely creating a very good short opportunity for the near-term. The CPC put/call ratio drops to 0.76 indicating that a market top is at hand (see previous chart). The expectation is for a pull back to occur and it should begin at anytime in the trading hours ahead. As always, the central bankers are the market, and the wild card, so if they decide to goose stocks that will temporarily create more lift before the selling begins. 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.

SPX S&P 500 Monthly Chart Rising Wedge Overbot Negative Divergence

The monthly charts will receive new prints on Thursday for the EOM. April began at 2068 so the month is positive with four days remaining. Keystone has posted this chart over the last year providing the play-by-play waiting for the multi-year top to print. Note how price fell out of the rising wedge last month (March) but now recovers in April to back kiss the wedge trend line from the underside for a bounce or die decision.

The red lines show negative divergence across all indicators (bearish). It took a long time for the chart to set up for the bears. The MACD cross is negative. If April finishes here or higher the indicators should remain negatively diverged pointing towards a weak May ahead. Price is extended above the moving averages requiring a mean reversion lower. The collapses from rising wedge patterns can be quite dramatic.

The 18-year cycle is the most reliable cycle with a secular bull from 1982 to 2000 and markets are currently in a secular bear market from 2000-2018. It is normal to have strong cyclical rallies inside secular bears. The chart set-up hints that the bears will finally begin growling again to finish off the secular pattern into 2018. It would not be surprising to see the stock market down say 3 of the next 4 years. The chart can be revisited after April's print is finalized later in the week ahead. The expectation is for a multi-year top to occur now; it is actually a bit surprising to see the SPX print a new record high last week as the indicators are already spent showing a lack of oomph available moving forward.

The Nasdaq monthly chart is similar except for the MACD continuing to slope slightly higher which indicates that the tech stocks may need a couple more months to officially top out for a multi-year top and this juice in tech stocks helps to elevate the SPX and Dow which are wanting to simply call it quits to the six-year rally going forward. The broad stock market is expected to top out at current levels with all indexes peaking and rolling over now through July. The market bears need a little more patience but their long multi-year wait for weaker markets for the weeks, months and likely a year or three ahead is very near.

Pay attention to the 10-month and 12-month MA's at 2033 and 2018, respectively, since these levels signal the official end to the six-year rally. The 10-month MA is an early warning signal that the old-time traders use and many algorithms, including the Keybot the Quant algorithm, Keystone's proprietary algo, program the 10-month MA into the computer models. Markets go off a cliff when the 12-month MA fails. 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.

SPX S&P 500 Weekly Chart Rising Wedge Overbot Negative Divergence

The SPX weekly chart trucks higher with a rising wedge pattern (bearish), overbot stochastics and negative divergence (red lines). The green lines for the RSI, stochastics and money flow, however, show the momentum over the last month with the bulls wanting to squeeze out a little more upside juice. Overall, in the multi-week and multi-month time frames price is running out of oomph to move higher. A rupture of the lower red trend line at 2100-ish will create downside momo.

The 20-week MA is 2068 the same level as where April began with only four days remaining in the month. This level has to be respected as a possibility for the week ahead. Watch the MACD cross, currently negative, to see if the bulls can squeeze out anymore upside juice, or not.

The blue circles show the volume behavior over the last few months. The new record price highs come with far less volume than mid-March when the same price levels were explored. A strong market should have easily surpassed the prior volume in March. Ditto the strong volume behavior in December at highs near 2100-ish. Price keeps moving to new highs above 2090 but each time the volume weakens rather than strengthens hinting at a lack of conviction.

Note the strongest volume candlestick for the selling event last October. This is when the global central bankers colluded to stick-save the markets and prevent a crash. It is prudent to expect price to revisit the 1825-1910 area to see how volume stacks up against the October candlestick.

The near-term momo (green lines) may allow the bulls to play around in the apex of the rising wedge (after a near-term selloff occurs due to the uber complacency with the CPC put/call) but the expectation is for price to roll over to the downside moving forward. Price is extending above the moving averages which will create a mean reversion to the downside. 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.

SPX S&P 500 Daily Chart Moving Average Ribbon Mean Reversion Upper Band Violation Negative Divergence Rising Wedge Overbot

There is lots going on for the spaghetti chart above. First, the pink dots show the extension of the moving averages (price above the 20-day MA at 2089.56 above the 50-day MA at 2089.67 above the 100 above the 150 above the 200) where a top occurs and a mean reversion lower is required. Currently, the 20-day MA is actually a hair under the 50-day by pennies but this chart on Monday will send the 20-day above due to the price momentum late last week.

Price is tagging the upper standard deviation band which indicates a near-term top is at hand. The extreme market complacency indicated by the CPC put/call ratio at 0.76 signals a market top at any time any day forward so if price further tags the upper band at 2123 that is likely a gift for the short side with prices expected to fall perhaps dramatically.

With the new all-time record highs occurring with price on Friday, the red lines show negative divergence across all indicators in the multi-week and multi-month time frames (bearish). Over the last few days, however, the green lines for the MACD, stochastics and money flow show momentum that may permit the bulls to squeeze out one or two days more of upside juice. The stochastics are overbot.

Despite all the euphoria at the tail end of last week with the new record highs, volume could not surpass the selling volume from one week ago in the sub SPX 2104 price candlestick. Therefore, it is prudent to expect price to drop to retest this area under 2104. Note the high volume print in mid-March due to central banker pumping with price in the 2090-2115 range. The SPX returns to this level last Wednesday through Friday but none of the three days even come close to that prior volume strength. The price move higher lacks conviction.

The red lines show a rising wedge pattern which is bearish and a failure at the 2090-ish level would indicate trouble ahead for markets. Continuing the red rising wedge into the future targets August as the apex and the bulls may be able to hold on for 2 to 4 months if they can hold the 2090-ish level during the expected pending selloff.  Factoring in the above mumbo-jumbo and the low CPC put/call ratio, a bearish strategy going forward is prudent. The VIX is 12.29 showing that traders are not bringing on protection since no one expects a a market pull back to occur and that is when a pull back occurs. Get protection and bring on shorts. Ditch any longs you do not plan to hold for several years. 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.

SPX Support, Resistance (S/R), Moving Averages and Other Important Levels for Trading the Week of 4/27/15

SPX (S&P 500) support, resistance (S/R), moving averages and other important levels are provided for trading the week of 4/27/15. Levels shown in bold are strong resistance and support. Bold and underlined levels are very strong and important S/R. The SPX all-time intraday high is 2120.92 on 4/24/15 and the SPX all-time closing high is 2117.69 on 4/24/15. The low for this year is 1980.90 which identifies the starting point of the huge February rally a stick-save created by the global central bankers.

For Monday with the SPX starting at 2118, the bulls only need three points, to touch the 2121 handle and bingo, a multi-handle upside acceleration will occur into the mid 2120’s. Bears need to push under 2113 to accelerate the downside. A move through 2114-2120 is sideways action to begin the week. The SPX began the year at 2059 so stocks are positive on the year up +2.9%. April began at 2068 so the month is currently positive with four trading days remaining; Thursday, 4/30/15 is EOM (end of month).

The bulls are punching out new highs fueled by the collusion of the global central bankers. The ECB is juicing the markets with QE (quantitative easing). The Federal Reserve will likely not announce the first rate hike until September, perhaps not until 2016, so the easy money party continues. Last week, China announced the triple R cut for banks which blew the market bears out of the water before the Monday bell could ring to begin the week. Lower triple R’s permit the Chinese banks to lend more which stimulates the economy and sends stocks higher. The market bulls simply need 2121 and higher and the party continues.

On the lower side, the market bears must push down through the strong 2117 support and then through Friday’s low at 2113 to get their mojo back. The failure at 2113 will immediately test the strong 2110 support for a bounce or die decision. If 2110 ruptures, price will next target 2104 S. Note the strong support gauntlet at 2089-2091. Bears can start to create damage if this area fails.

There are four days remaining in April which began at 2068 and note the support cluster at 2065-2068. Considering the ominous forecast for stocks with the low CPCE put/call ratio (see previous chart), a price move down to 2065-2068 is a realistic possibility for the week ahead and this lower price level may serve as a magnet for the SPX during the middle and late week of trading. Consumer Confidence hits on Tuesday and the FOMC Announcements and GDP is out on Wednesday so there is high drama ahead.

Looking at the big picture the strongest S/R is 2121, 2120, 2118, 2117, 2110, 2104, 2091, 2081, 2076, 2067, 2061, 2046, 2040, 2038, 2032, 2030, 2023, 2019, 2011, 2002-2003, 1997-1998, 1993, 1988, 1985-1986 and 1982. The SPX moves choppy sideways through 1990-2120 for the last six months with price now at the top of the range. Stocks will slide lower if 2110 fails. The situation will grow bleaker if 2104 fails. Markets will begin deteriorating dramatically if 2089-2091 fails and market mayhem will begin if 2065-2068 fails.

2121 (4/24/15 All-Time Intraday High: 2120.92)
2120.92 Previous Week’s High
2120.92 Friday HOD
2120 (2/25/15 Intraday High: 2119.59)
2118 (4/24/15 All-Time Closing High: 2117.69)
2117.69 Friday Close – Monday Starts Here
2117 (3/2/15 Closing High: 2117.39)
2115
2113
2112.80 Friday LOD
2111
2110
2108
2107
2105
2104
2103
2101
2100
2099
2097
2094 (12/29/14 Intraday High: 2093.55)
2091.44 (200 EMA on 60-Minute Chart a Keystone Market Turn Signal)
2091 (12/29/14 Closing High: 2090.57)
2089.67 (50-day MA)
2089.56 (20-day MA)
2089
2084.11 Previous Week’s Low
2082
2081
2079 (12/5/14 Intraday High: 2079.47)
2076 (11/28/14 Intraday High: 2075.76)
2075 (12/5/14 Closing High: 2075.37)
2073 (11/26/14 Closing High: 2072.83)
2072
2071 (11/21/14 Intraday High: 2071.46)
2069
2068.00 (20-week MA)
2067.89 April Begins Here
2067
2066.55 (100-day MA)
2065
2063
2061
2058.90 Trading for 2015 Begins Here
2057
2056 (11/18/14 Intraday High: 2056.08)
2054
2052
2050
2046 (11/13/14 Intraday High: 2046.18)
2041
2040
2039.63 (150-day MA; the Slope is a Keystone Cyclical Signal)
2038
2034
2033.59 (10-month MA; a major market warning signal)
2032
2030
2024
2023.35 (200-day MA)
2023
2021
2019 (9/19/14 Intraday High: 2019.26)
2018.31 (12-month MA; a Keystone Cyclical Signal) (the cliff)
2018
2016
2014
2012
2011.85 (50-week MA)
2011 (9/18/14 Closing High: 2011.36) (9/4/14 Intraday High: 2011.17)
2009
2007 (9/5/14 Closing High: 2007.71)
2005 (8/26/14 Intraday High: 2005.04)
2004
2003 (8/29/14 Closing High: 2003.37)
2002
2001
1999
1998
1997
1995
1993 (1/15/15 Closing Low for 2015: 1992.67)
1992
1991 (7/24/14 Intraday Top: 1991.39)
1988 (7/24/14 Closing High: 1987.98)
1986 (7/3/14 Intraday Top: 1985.59)
1985 (7/3/14 Closing High: 1985.44)
1983
1982
1981 (2/2/15 Intraday Low for 2015: 1980.90)
1979
1978
1976
1973
1970
1968 (6/24/14 Intraday Top: 1968.17)
1965
1964
1963 (6/20/14 Closing High: 1962.87)
1962
1961
1960
1958

CPC Put/Call Ratio Daily Chart Signals Significant Market Top At Hand

The drama with the put/call ratio continues. Complacency is rampant. Traders are completely fearless buying any stock long without any fear or worry. The global central bankers are acting in collusion to keep stock markets elevated to make the rich, that own stocks, wealthier. The Federal Reserve, democrat and republican politicians, upper middle class and elite, company CEO's and business executives are an incestuous club and the common American is the bag holder. The ECB quantitative easing (QE) program is the latest player in the easy money party game a six-year orgy so obscene that Caligula would blush.

For a detailed description of the current complacency and market euphoria reference Keystone the Scribe's daily chronology (a link is in the right margin). Scroll down to the end of Friday's narrative and a couple paragraphs explain the ongoing market fearlessness which typically occurs at market tops. Everyone is giddy drinking wine each day and buying stocks with total disregard for price or valuation.

Keystone first highlighted the market complacency with the 4/15/15 low print (eight trading days ago). As Keystone has noted over the years, the low prints in the CPC and CPCE put/calls indicate a market top either right away or within a few days time. This time around is a little more tricky with a triple bottom in the CPC occurring over the last several days. The first low print resulted in the SPX dropping from 2113 to 2072. Surprisingly the bulls recovered very quickly; typically you would expect a bit more selling. China lowered the triple R requirements last Sunday, 4/19/15, which provided jet fuel for global stock markets all week long. The central bankers are the market.

The market euphoria continues with the middle low print at 0.79 on 4/20/15 (last Monday) warning of another market top. A small pull back occurs from SPX 2110 to 2090 only 20 handles and much of the move is intraday action so if you walked away from the computer for a cup of coffee or to visit the can you missed the move. The party atmosphere continues during the week and the Nasdaq explodes higher on Friday due to the joyous earnings with AMZN, GOOGL, MSFT and SBUX. It is this euphoric party atmosphere that dumps the CPCE to the 0.76 low a low not seen since December four months ago. That prior low in late December identified the market top to begin the year where the SPX dropped from 2095 to 1991 a downward move of 104 handles over five days (that was a quick flush).

The CPCE put/call ratio is at 0.60 and did not sink to new lows to match the CPC above, thus, the bulls may be able to pull off another day or two of upside juice where the CPCE will drop lower although this is not absolutely necessary. The triple lows in the CPC is extremely ominous.

If you did not buy puts for protection, or inverse ETF's such as SH, SDS, DOG, DXD, QID, and TWM, or short stocks and indexes, or exit your long positions, you made a mistake. If markets do drift higher early in the new week of trading consider it a gift and immediately implement your bearish strategy going forward. Markets are poised to sell off beginning any day forward and a reasonable expectation is for the SPX to drop from 40 to 100 handles as April finishes and early to mid-May occurs. The stock market is expected to sell off until the CPC prints above 1.20 to show that sufficient fear has returned to create a near-term market bottom.

As mentioned in the prior CPC message, scaling into the short side is prudent and despite the run-up in the indexes with the SPX back above 2100 and now printing new all-time record highs above 2120, continue scaling into the short side since the market top is nigh. Strap yourself in for a wild ride ahead to the downside. 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.

COMPQ Nasdaq Composite 5-Minute Chart New All-Time Record Closing High 5092.08

The Nasdaq prints a new all-time record closing high at 5092.08 besting the prior day's all-time record closing high at 5056.06. The all-time record intraday high remains at 5132.52 from 3/10/00 and is not yet violated. The COMPQ tagged 5100 in yesterday's trading only 32 points from the highest print in Nasdaq history during the dotcom bubble. 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.

SPX S&P 500 3-Minute Chart New All-Time Record Intraday High 2120.92 and Closing High 2117.69

The SPX prints a new all-time record high at 2120.92 at 12:33 PM EST on Friday, 4/24/25, and new all-time closing high at 2117.69. The prior records are 2120.49 from the day before (Thursday, 4/23/15) and 2117.39 from early March, respectively. The new intraday high bests the prior day by 43 cents and the new closing high beats the prior record by 30 pennies. The central bankers are powerful. 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.