Monday, January 30, 2017
SPX S&P 500 Daily and Weekly Charts; Over Extension Above Moving Averages
The SPX daily chart shows price above the 20-day MA above the 50 MA above the 100 above the 150 above the 200. The SPX weekly chart shows price above the 20-week MA above the 50 MA above the 100 above the 150 above the 200. The moving averages are above each other and price is up at the tippy-top with its face pressed into the ceiling. A mean reversion lower is desperately needed where price comes back down to earth to kiss a moving average or two.
Further, which is very important for those managing money long term, the SPX monthly chart shows price above the 20-month MA above the 50-mth MA, above the 100 MA above the 150 above the 200. The charts indicate that a multi-year top for the stock market is very likely to occur in the weeks and months ahead. If you are Joe Six or Ma and Pa Kettle, or Aunt Jane or Uncle Paul, it is likely prudent to scale-out of the long side positions as the weeks play which is the opposite of what the television pundits say.
Just think, in a year or two, or three, price has to return to earth and when it does the moving average ribbon rolls over to the downside as well. In the future, the SPX will be under the 20 under the 50 under the 100 under the 150 under the 200. You can imagine how far down that will be. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added 8:38 PM EST Monday Evening: The SPX sells off today but recovers into the closing bell ending at 2281. The LOD is 2268 and price tags the 20-day MA at 2273; at least one moving average was back kissed today, for now.