The S&P 500 Index continues to find support near its 200-day moving average and recently bounced near the early February lows. Additionally, the retest of the February lows took place on lower volume, which is a positive sign that we could be nearing the end of this bottom process.
“The last time we made a major bottom it took nearly six months, from August 2015 to February 2016. One major difference between then and now is we were in an earnings recession in 2015 and credit markets were flashing potential recessionary warnings. Fortunately, this time earnings are expanding nicely and credit markets have remained fairly calm,” according to John Lynch, Chief Investment Strategist.
In fact, we are seeing signs that higher prices could be on the horizon. Find out why in this week’s Weekly Market Commentary due out later today.
The S&P 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
The 200-day moving average (MA) is a popular technical indicator which investors use to analyze price trends. It is the security or index’s average closing price over the last 200 days.
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