Whey are Monthly Pivots so important ....?

Below you see a brief graphical depiction of Monthly Pivots and Tom DeMark Sequential Setups (I simply use the counting rule, if you want to find more google it and you will find a host of sources.....)

Next we show what are structural features of a bear (and bull) Markets through the lense of the above indicators. You see below 50+ years of the S&P500.

At first sight ,simply visually ,you will notice the strong bear and bull phases.

Interesting for us here is the observation that the we also had in the 70ties bear market a strong intermediary bull campaign which felt like the start of a bull and set up for the most brutal final 10-15month tumble (in terms of the TSDQ counter). This should warn us, given that we just went through a similar imtermediate bull campaign.

(positive values always present bull signals and vice versa).

The next chart shows a close up of the last 15 yrs and combines the TDSQ's with the Monthly Pivots (once we have a confirmed Pivot in place the signal is valid until we see a countersignal).

Key takeaway here is that the Pivots seem to turn earlier (lead the TDSQ) and that they have poduced fairly reliable signals.

The PIVOTS have just turned a again. This is what we mean when we say the structure of the Market has changed to the bearside!!