Last week SPX drove up to the 200 day moving average and then dutifully pulled back from it. Ah, but it is never that easy (or cut and dry) over short time frames. SPX left a gap last week and is rising to close that gap this morning in pre-market.
Hence, nothing whatsoever has changed. The S&P 500 is on a relief rally and it is below the SMA 200, which is the next key resistance level we are watching. From here, with all due grinding, whipsaws, headfakes and other short-term noise it is either going to fail back into its downtrend or it is going to negate that trend in favor of a resumed bull market.
It sounds simple enough, but it is easy to get carried away in the events of any given day or week. So this update is just a reminder that the status is as it has been; relief rally in progress. The rally by SPX and several other indexes are very close to changing trend, but have not yet done that. So why don’t we let the market tell us what it plans to do? The next bullish objective for SPX would be to take out and hold the SMA 200. Meanwhile, it is below that objective still.