Technical Analysis – US 500 index drifts lower, crosses back below 200-day SMA
November 15, 2018 5:26 pm
The US 500 index fell sharply in recent sessions, crossing decisively back below its 200-day simple moving average (SMA) on November 12, which has turned the near-term bias to negative.
Short-term oscillators support the notion. The RSI is below 50 and pointing lower, detecting accelerating negative momentum. The MACD, already below zero, is currently testing its red trigger line; a move below it would be a bearish signal.
Further declines in the index could stall initially near the 2632 level, defined by the lows of October 30. A downside break may open the way for the 2602 zone, the October 29 trough, before the April 4 bottom of 2560 comes into view.
On the flipside, a recovery could meet resistance around 2714, which capped the declines on November 5 and 12. If the bulls pierce above it, the next barrier may be the 2755 area – note that the 200-day SMA at 2763 is also part of this zone. Another upside break would turn the bias to neutral, perhaps seeing scope for a test of 2818, the November 7 peak.
Overall, both the short-term and medium-term pictures appear negative at the moment.
The US 500 index fell sharply in recent sessions, crossing decisively back below its 200-day simple moving average (SMA) on November 12, which has turned the near-term bias to negative.
Short-term oscillators support the notion. The RSI is below 50 and pointing lower, detecting accelerating negative momentum. The MACD, already below zero, is currently testing its red trigger line; a move below it would be a bearish signal.
Further declines in the index could stall initially near the 2632 level, defined by the lows of October 30. A downside break may open the way for the 2602 zone, the October 29 trough, before the April 4 bottom of 2560 comes into view.
On the flipside, a recovery could meet resistance around 2714, which capped the declines on November 5 and 12. If the bulls pierce above it, the next barrier may be the 2755 area – note that the 200-day SMA at 2763 is also part of this zone. Another upside break would turn the bias to neutral, perhaps seeing scope for a test of 2818, the November 7 peak.
Overall, both the short-term and medium-term pictures appear negative at the moment.
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