SPX Seeks Support: Will the 100-DMA Hold or is a Deeper Dive Coming?
$S&P 500(.SPX)$ $SPDR S&P 500 ETF Trust(SPY)$ at a Crossroads: Historical Pullbacks Offer Clues
SP500 is currently navigating a significant decline, recent overextensions offer valuable insights into potential support levels. While past pullbacks often found support at the 50 DMA (Purple) or the 100 DMA (Green), the descent to the 125-DMA (Red) wasn't always a straight line down.
For this analysis, an overextension relative to the 125 DMA is when SPX has been 8% or more above that average.
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Recent Bounce Points:
The chart highlights historical pullbacks (marked by purple and green arrows) where the SPX found support at either the 50-DMA or the 100-DMA after reaching an overextended peak.
Current Situation:
On Friday, $SPX found some support at the 100-DMA, and the RSI indicator currently sits at 31, suggesting oversold conditions.
Fear Gauge:
The current distance to the 125-DMA, which is a component of the Fear and Greed Index, currently reads as "Neutral." This stands in contrast to the more fearful readings on other components of the index.
The Road Ahead:
Will the 100-DMA hold as support, or will the SPX experience a deeper decline towards the 125-DMA?
More charts to navigate the upcoming week in Bio.
Worth Noting:
125DMA currently sits at $4842, far from the popular $4600
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