Attached is the new monthly bar chart of the cash SP500 (bottom pane).
Of continued interest is the pending 9-13-9 “sell” signal generated by DeMark analysis. I use this signal in a conservative fashion – to me it is not activated until we get a price flip. For that to occur in July we would need a closing price below 1569.19 on July 31. On the other hand, this sell signal would be negated on a confirmed and validated break of the 1659.11 level (shown by the horizontal cyan colored line). I will also be watching the Beta-X price pulse trendline on this chart. A confirmed and validated break would be a price pulse “sell” signal.
Also of concern on this chart is the fact that the Composite Index (top pane) has turned down in the same area as it did prior to two other major peaks during the run up from the 2009 low. Now, although the RSI (not shown) is at its highest level since that 2009 low, the composite is next. This is a bearish divergence.
Finally, the wave count based on the price pulses show we are near the end of a complete A-B-C Zigzag pattern. This is another reason I remain wary of equities right now.
