Weekly NASI and Divergence of NASI RSI with SPX Price

During the 1st 3 quarters of 2007 (see top chart), the SPX whipsawed up as the NASI RSI (red lines) whipsawed down (divergence). Purple ovals are the Complex NASI Tops. There was a NASI mega-uptick (lower black arrow) in July 2007. The SPX finally turned down in October 2007 (thick vertical black line). A similar weekly pattern is evolving at this time. The green arrow is a routine uptick during a down-leg. We now need to complete a right shoulder (see prior posts) and do run the risk of one of those occasional mega-upticks before the current down-leg resumes. The current down-leg could be significant (>20%), but, based on the prior divergence pattern, could also be interupted by one more run-up in the SPX. The middle chart demonstrates an $NDX RSI(9)>90 during the July 2007 mega-uptick. In 1938 (see lower chart), the RSI went up over 90 during the final uptick just before the 21.72% drop from mid-November 1938 to early April 1939.