Financial SPDR ETF Approaching 200-Day Simple Moving Average
05/08/2009 12:01 am EST
The banks have had a nice run up from their lows in 2008. However, I noticed today that the industry ETF is coming precariously close to the 200-day simple moving average.
These things tend to self-fulfill simply because lots of traders are watching this key indicator.
A trend line indicates that it could break through, so be sure to get a few candles for confirmation, but if it does bounce off and head downward, it might be nice for a short play—but only for a few days. And be sure to set your stop just above that line.
By Tim Bourquin, Trading Content Director, MoneyShow.com