Traders Cooperative

[Jerry Olson]

Just a headsup here!

Next i want to bring to your attention what i would consider a major potential blow to this whole market. The Bullish percent of the SPX my proxy for the markets is in real trouble as of today. Let me lay this out for you all. 1. Weekly Momentum is now negative for just 1(one) week and could stay this way for another 6-7 weeks which is not a good thing. 2nd On the chart of the SPX Bullish Percent we have a chart pattern called a "Bullish Signal Reversed" which is bearish. After breaking out and touching 70% recently it promptly sold off to break a double bottom at 52% falling all the way to 46%. Last week this BP reversed back up 3 boxes to 52 again, off that feeble counter trend rally when the SPX hit 877 on the chart a lower high from 945. The problem is folks, that we could see this indicator quickly reverse that 3 box move back up by breaking below 46% at 44%. in other words. We would get massive selling that would break that 46% low and then catapult down to a potential of the Nov lows on this chart at 2%. I know it sounds nuts and do not think we'll get that low again on this move down but if we take out 46% on a print of 44% then my down side target would be around 24% on this chart. What this means is the entire stock market would be in free fall over the next 30-60 days with selling all rallies on the way. Here's the chart of the SPX Bullish percent currently at 47% on the chart a move below 44% is the death blow to the whole market. http://www.screencast.com/users/JerryO34/folders/Snagit/media/91d324a0-8687-43a1-b41f-294586ff3568