The major US stock indices are giving back some of their gains. Although they are still higher on the day, there has been some damage done technically.
Looking at the S&P index, it opened today and moved above its 100-day moving average at 5309.32. The high price for the day reached 5330.64 but has since rotated back to the downside and currently trades at 5269.91 still up 29.93.or 0.56% but back below is 100-day moving average. That is a problem technically. Bearish.
Recall from yesterday, the price briefly moved above the 100-day moving average but quickly rotated to the downside. So if this persists, it will be the second consecutive day of a failure, and could shift the bias back to the downside after the correction off Monday’s lows.
For the other major broad index the Nasdaq index, it moved above a key swing area between 16442 and 16538 in treating today. The high price reach 16709.81, but has since rotated lower.
The price of it is currently trading at 16464. The low reach 16444 just above the low of that swing area. If the price moves below that level, the 38.2% retracement at 16330.47, would be targeted. Fall below it, and more selling can be expected. The NASDAQ index did not get up to its 100 day moving average (blue line on the chart below).
UPDATE. The S&P index is now up just 6.40 points or 0.12% at 5245.89. The NASDAQ index is up only 23 points or 0.15% at 16392.90, and getting closer to the 38.2% retracement target 16330.47.
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This article was written by Greg Michalowski at www.forexlive.com. Source