The market battle continues to be a technical one with short-term moving averages acting as resistance and certain moving averages acting as support starting to fail. Yesterday the S&P closed below the 50-day moving average for the first time since March. Things can get interesting in this specific technical situation as it is often a “go or don’t go” scenario. In 2021 price fell below the 50-day moving average several times only to bounce back quickly above the 50-day and continue the longer-term trend. Other similar instances in recent years saw quick downward movement once this support level gave out. It is an important technical battle to say the least and one where patience over boldness is good advice.

There are certainly headlines that are “causing” the downward price movement. China seems to be in a lot of market headlines the last couple of days. So many mainstream financial headlines are attributing the downward movement to China and the economic woes going on in that country. However, China’s central bank just injected the largest short-term cash to the financial system since February. If we rally tomorrow, will it be because investors magically developed faith in China’s central bank overnight? Of course not. Price tends to create the narrative of the market and one should pay attention to the technicals over everything right now. They will tell you the true story.

We will break down this technical battle on the market today along with a preview of the Fed minutes, economic data released today, discuss Tesla price cuts, Target earnings and much more! Come join a truly informative hour!

S&P 500 2021 (SPY)

In 2021 during that beautiful bullish uptrend price would come down to the 50-day average several times, breaking it occasionally, only to quickly recover. However, in previous years the breaking of the 50-day moving average was met with swift price action to the downside. This is always a pivotal and interesting time on the charts.

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