Weakness has entered US Markets.
Below is a monthly chart of the S&P500 cfd. The 2030 support level needs to break for the bear market in US stocks to be confirmed. If this support level is held and new highs reached above 2120 resistance during the next couple of months - that would put the kybosh on my current bear market synopsis and a ranging stance may ensue until indicators say otherwise.
However, momentum oscillators remain bearish. Since the MACD down-cross during late-2015, the histogram has continued its bearish expansion currently at -15.87 and falling. Note that the last time this indicator was at these levels and falling was during both
early-2001 and mid-2008 prior to markets falling heavily. Also, Stochastics has formed a lower high during late-2015 and is in the process of potentially forming another lower high now - to be confirmed. Note that the last time %K left the overbought region (<80) was during
early-2001 and early-2008, again, prior to these markets falling heavily. These signals remain bearish.
As we are currently within the mid-2016 period, for the bear market theory to remain valid SPX needs to reach mid-year target lows of 1790's no later than July/August and end-of-year lows of 1570's before December, however, no later than January/February 2017. Currently looking like a tall order.. DYOR.
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