Suddenly the Market Stopped Moving!
The S&P 500 had its biggest drop since March last week, bounced hard and now it’s dead in the water. What’s happening?
Several things, it turns out.
This chart shows how SPX has been trapped inside Tuesday’s candle for the last two sessions. But it’s holding the 8-day exponential moving average (EMA), which suggests the short-term trend is still positive.
The index also had a false breakdown under both its 200-day simple moving average (SMA) and the psychologically important 3,000 line. The fact it held those levels is potentially positive over the longer term.
Finally, why is SPX stuck here? Take a look to the left and you can see how the current range matches the pivot high from early March. At that time, the market was crashing and had one final bounce before blitzing back through 3,000. That level is now becoming resistance.
But will it last? SPX is currently in the midst of its best quarter since late 1998. The economy is reopening (see Empire index, consumer sentiment, NAHB sentiment) and the Fed is going full throttle. All those considerations may lay the groundwork for bullish window dressing into quarter-end -- now just eight sessions away.
Several things, it turns out.
This chart shows how SPX has been trapped inside Tuesday’s candle for the last two sessions. But it’s holding the 8-day exponential moving average (EMA), which suggests the short-term trend is still positive.
The index also had a false breakdown under both its 200-day simple moving average (SMA) and the psychologically important 3,000 line. The fact it held those levels is potentially positive over the longer term.
Finally, why is SPX stuck here? Take a look to the left and you can see how the current range matches the pivot high from early March. At that time, the market was crashing and had one final bounce before blitzing back through 3,000. That level is now becoming resistance.
But will it last? SPX is currently in the midst of its best quarter since late 1998. The economy is reopening (see Empire index, consumer sentiment, NAHB sentiment) and the Fed is going full throttle. All those considerations may lay the groundwork for bullish window dressing into quarter-end -- now just eight sessions away.
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