Get 40% Off
👀 👁 🧿 All eyes on Biogen, up +4,56% after posting earnings. Our AI picked it in March 2024.
Which stocks will surge next?
Unlock AI-picked Stocks

U.S. Indices: 200-Day Moving Averages Come Into Play

Published 08/08/2022, 03:25 AM
Updated 07/09/2023, 06:31 AM

There is still plenty of time before it happens, but given markets are making positive gains beyond the last major swing highs in May/June we have to consider the next major test of 200-day MAs. Even if this proves to be a bear rally, each gain firms up the possibility that the June lows *are* the low for this cyclical bear market (the secular low was March 2009, and the secular bear market ended in 2013 - at least for the S&P).

The NASDAQ is leading the indices having handily take out the June swing highs. Accumulation has been climbing with the rising On-Balance-Volume, and the MACD on a new 6-month high.  Stochastics are overbought, which you want to see in a rally (it's when stocastics [39,1] drift out of overbought territory you have to worry).

COMPQ Daily Chart

The S&P hasn't quite made it beyond the June high, but with the 200-day MA not far away there is likely to be a combo breakout-test on the way. If there is a downside, On-Balance-Volume is on a 'sell' trigger, but it came on the start of a buying recovery before the 'sell' trigger. Other technicals are positive.

SPX Daily Chart

The Russell 2000 just edged a close above the June high (and has the most room to run to reach the 200-day MA). Summer trading volume has hit this index harder than others, but the Fall season should see a pick-up - particularly if the 200-day MA can be breached. 

IWM Daily Chart

There has been little pause in this rally since late July, so lets assume the test of 200-day MAs come before a test of the last swing low of this rally (in late July). Buyers have control and likely will keep it until the holiday season is over.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Latest comments

Thanks.
Holiday season is a ways off
Mornings
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.