NYA NYSE Composite Weekly Chart 40-Week MA Cross Cyclical Bull Market Remains in Place

The first hour of trading on Monday will be critical for the path ahead for the stock market. The importance of the NYA 40-week MA cross cannot be understated. Watch it like a hawk since it tells you who will win over the short and intermediate term ahead, and potentially for the long term ahead. The bears have not shined since 2011 and 2012. The huge stock market gains are due to the ongoing obscene central banker intervention, especially the Fed and BOJ, pumping equities higher with easy money to make the wealthy, that own stocks, wealthier. The stock market gains in 2013 are due to the BOJ bludgeoning the yen as Governor Kuroda runs the printing presses 24/7.

The red rising wedge, overbot conditions and negative divergence created the initial spank down off the top as Keystone forecasted at the time. Price returns higher to print a double top, an M Top, with neggie d remaining across all indicators, so down she goes again as Keystone indicated about one month ago. The red lines show weak and bleak indicators so after any bounce occurs, lower prices would be expected. Note that the RSI has slipped under 50% into bear territory for the first time in two years. The power of the central banks is astonishing, however, and always serves as a wild card, pumping the markets higher and not permitting the stock market to ever correct properly. This creates fluff and air under the stock market that will be reconciled some day forward. The question is whether it is only -10% or -15% of fluff, or is it -80% fluff? The central bankers have pumped markets higher for nearly six years and all asset classes are now inflated with many in bubble territory.

Watch the NYA 10629 level on Monday and you can ignore everything else. If the NYA stays above 10629 it will be a big bull party next week with the Fed wine and BOJ heroin in full supply. If the bears push NYA under 10629, severe market carnage and mayhem will begin. 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 11:30 AM on Monday, 10/6/14: The NYA leaps above 10700 after the opening bell so the bulls punch the bears in the face staying well above the 10630 line in the sand representing the 40-week MA. The broad indexes stagger sideways after a gap and crap. The NYA is 10660 remaining 30 points on the bull side.