The S&P 500 made fresh all-time highs at the end of November, continuing the string of new highs it has been making since April of 2013, when it broke the old pre-crisis high of 2007, the 1576 level.
Following the new highs just above 1811, a modest correction has followed, driving the S&P back by around 1.5%. The uptrend is still in place.
Should the correction continue, a number of levels are likely to provide support. First of all, the 50-day moving average at 1767 is a little below current price action. Failing that there is a support zone between the 1726 and 1736 levels.
If these levels fail, there is the 200-day moving average at 1665. The S&P has not challenged its 200-day average for more than a year – since November of 2012 – such has been the strength of this upswing.
The MACD is looking bearish, as although it is positive, it is on a declining trend and it’s below the red signal line. The MACD is signaling some caution.
To sum up, a modest correction is underway and the uptrend will resume when the index makes new highs above 1811. This correction could become a more serious affair if the 50-day average does not hold and then the 1726 level fails. But barring such negative events, higher prices should follow.
(Click to enlarge)
The S&P 500 made fresh all-time highs at the end of November, continuing the string of new highs it has been making since April of 2013, when it broke the old pre-crisis high of 2007, the 1576 level.
Following the new highs just above 1811, a modest correction has followed, driving the S&P back by around 1.5%. The uptrend is still in place.
Should the correction continue, a number of levels are likely to provide support. First of all, the 50-day moving average at 1767 is a little below current price action. Failing that there is a support zone between the 1726 and 1736 levels.
If these levels fail, there is the 200-day moving average at 1665. The S&P has not challenged its 200-day average for more than a year – since November of 2012 – such has been the strength of this upswing.
The MACD is looking bearish, as although it is positive, it is on a declining trend and it’s below the red signal line. The MACD is signaling some caution.
To sum up, a modest correction is underway and the uptrend will resume when the index makes new highs above 1811. This correction could become a more serious affair if the 50-day average does not hold and then the 1726 level fails. But barring such negative events, higher prices should follow.
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