Wednesday, October 29, 2008

Time for a Rally to the 50 Day Moving Average of 1130?

On Tuesday, October 28, 2008 the S&P 500 had a very good day, going up 10.79% from an open of 848.92 to close at 940.51.

In a previous blog, we also speculated the S&P would re-test the previous lows.

On October 17, it appears as if we hit an intra-day low which is almost as low as the low on October 10. If we look at the SPY, the S&P 500 ETF, the SPY did successfully test the low on October 10.

The 50 Day moving average on the $SPX is 1130, and the closing price on Tuesday, October 28, is around 940. The S&P 500 is around 20% below the 50 day moving average, which is an overextended amount.

There will be a time when we do rally, and the S&P 500 will approach the 50 day moving average.

Is now the time for a tradable rally?

Today's Stock Chart

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