S&P Tests and Moves Below the 100-Day MA
01/07/2015 9:00 am EST
Greg Michalowski, of ForexLive.com, demonstrates how the S&P index—which continued to move lower on Tuesday—is being tested and he highlights how a second dip below the 100-day MA in less than a month is a worry and worthy of a cause for pause.
The S&P (SPX) index continued the move lower in trading on Tuesday.
Weaker US data is not a help. Also, in a Bloomberg article, Janus’ Bill Gross said:
“With global expansion still sputtering after years of interest rates near zero, investors will gradually seek alternatives to risky assets.”
“When the year is done, there will be minus signs in front of returns for many asset classes.”
- The S&P price held topside trend line last week. Sellers leaned against the level. Bearish.
- The price fell below the 50-day MA Monday at 2040.61 currently (bearish), and is now
- Moving below the 100-day MA at the 2003.68 level (see blue line in the chart above).
In mid December, the price fell below the 100-day MA before the Fed meeting buy rallied up with a strong Christmas rally. A second dip below the 100-day MA in less than a month is a worry and worthy of a cause for pause. Has the stock run their course?
The 200-day MA is at the 1960.09 level. A move to this level would be a 6.35% decline from the top. That certainly is within the realm of possibilities. A 10% decline targets 1884.
The S&P is currently trading at 1998.57 as selling intensifies.
By Greg Michalowski of ForexLive.com