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The charts and comments in my Blog (posted in Eastern Time) represent my technical analysis and observations of a variety of markets...
*World Indices *U.S. Indices *Futures *U.S. Equities & Sectors *ETFs *Commodities *Forex
...an expanded version of the "Observations" section in my private Daily Trading Journal.

*** N.B. to my readers: Although I stopped trading in July 2013, I still take a peek at the markets now and then and post the occasional article here on my Blog.
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Sunday, December 02, 2012

Moving Averages of the Major Indices

The 10-Year Daily chartgrid below shows only the 50, 100, and 200 smas of the Dow 30, S&P 500, Nasdaq 100, and Russell 2000 Indices, without the candles.

All three moving averages are still in an uptrend on the daily timeframe; however, the 100 and 200 smas are beginning to flatten, the 50 sma has hooked down, and they are merging...a possible sign of a reversal-in-the-making. In fact, the 50 sma has crossed below the 100 sma on the Nasdaq 100 Index, and is getting close on the other three Indices...reflective of recent weakness and profit-taking, particularly in the Technology index.

A 20 sma has been added on the next close-up shot of the chartgrid. This moving average has crossed below the other three smas on the Dow, Nasdaq, and Russell, but not on the S&P, yet. Looking at these four moving averages, they are all still in uptrend (higher highs and lows). However, I'll be keeping a close eye on the 20 sma on the SPX, in particular, to see whether it crosses below the 200 sma, and I'll be watching to see whether price on the SPX breaks and holds below the important 1400 level mentioned in my post of November 30th. A failure of the 20 sma to cross back up above the 50, 100 and 200 smas would likely signal that further weakness has entered the markets, with the potential to see it make a lower low.

Below are Weekly and Monthly charts showing the 20/50/100/200 smas. The Weekly smas are still clearly bullish (but the RUT is struggling), but the Monthly smas are starting to look a bit messy. This coincides with what I said in my last post.