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Bob’s Stock Market Weather Forecast Newsletter – 8/9/17 – bobsstocks.com

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the measured move technique I showed you some months ago predicted a high of 2485 in the S&P 500 before a correction could occur. Last week the S&P hit a high of 2491 before dropping back. As I write this newsletter the index is at 2475 and looks to be in a setup where a correction or bear market could begin.

August though October is seasonally the weakest 3 month period for the stock market. In recent weeks I have seen the market advance even though the number of stocks confirming new highs in the S&P has been declining. As I have shown you many times, there is a relative strength and momentum divergence vs. S&P price. In other words the price has made new highs on the S&P 500 but the relative strength and momentum are declining. That means the new highs are not being confirmed by more advancing stocks vs. declining ones and the underlying readings of the market are not confirming the new price highs.

These divergences do not necessarily mean the market is going to have a serious fall. It could, click here to read more.