Bearish Rumbling Underneath the Stock Market Surface – 11-22-21

The 10/03/21 blog “Struggling  to Go Lower – Part Three” noted  the S&P 500 (SPX) on 10/01/21 went below the bottom made on 08/19/21. However, there were less NYSE – new 52 – week lows ($NYLOW) on 10/01/21 than on 08/19/21 – a  bullish signal.  The 10/03/21 blog also mention that while October was seasonally bearish for US stocks that the bottom could be made  anytime in October.  I speculated that a lower SPX bottom could be made on 10/08/21 with the monthly US payroll report. The SPX made a lower bottom on 10/04/21 with another $NYLOW bullish divergence, this ended  the September to October correction.

On 11/22/21 the situation reversed.  The daily  $NYLOW chart courtesy of StockCharts.com updates the action of NYSE – new 52 – week lows. 

With the SPX making  a higher  low, $NYLOW has exceeded  the level recorded on 08/19/21  – a bearish divergence.

The  Nasdaq Composite (IXIC) has an even more stunning bearish signal.   The daily Nasdaq – new 52 – week lows ($NALOW) illustrates  its action since mid – 2020.

Amazingly after only a  one-day decline $NALOW spiked to its highest level since the bull move began in  March 2020.

On 11/22/21 both the SPX and IXIC  made new bull market highs and ended the day down and at the lows of the day. This action by itself is a  bearish signal.  Could a  major top for US stocks be in place as of 11/22/21?  It’s possible, but If the longer-term Fibonacci time cycles are in effect  US stocks could continue to make new highs into December 2021 – please see the 10/24/21 blog “Possible US Stock Market Top – December 2021”

Most likely the action of expanding new lows on 11/22/21 could be  a pre-earthquake shock prior to a big  US stock market earthquake beginning  in  December 2021.  A  big stock market earthquake could be at least a multi month decline of 20% or more from the all-time highs.

Published by Mark Rivest

Independent investment advisor, trader, and writer. Articles have appeared on Technical Analysis of Stocks and Commodities , Traders.com Advantage, Futuresmag.com, and Finance Magnates.

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