Chart courtesy of FusionIQ
Sometimes the KISS method (Keep It Simple Stupid) works the best. In an era of high tech math, computational algorithms and new data streams sometimes something simple works the most effective. That said the S&P 500 has been and continues to trend lower below its’ down sloping 30-day moving average. This average (for whatever reason) has provided short-term resistance like clockwork since the decline began back in August and once again repelled the most recent rally off the lows on Monday.
However, this is the shallowest pullback from the 30-day moving average resistance and the quickest subsequent attempt to move back above it (after a decline) since this all began. That said we will be watching trading activity closely the next couple days. We would view it technically significant from a near-term (trading) perspective if this index could finally move back above its’ 30-day moving average (and the 900 level on the S&P) as it would suggest a tradeable rally (from the long side) may ensue.
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