One Final Moving Average Study

Though I have complained recently that we’re now above some key moving averages that have contained bear markets historically, let’s look at one more.

I generally prefer to use the 250-day EMA because it more closely hugs the price action and gives fewer “whipsaws,” lets look at the more common 200-day SMA, understood by many to be the major institutional moving average.

If my confluence of fibs just above us align with our next good target (here), I do find it of interest to note that that closely coincides with the 200-day SMA above us as well:

SPX

So, let’s see what happens if we get there. Despite now being over the 250-day EMA (which past bear markets didn’t really do—the GFC went above it a little), and above the 89-week SMA (which is less of a concern because it being a weekly average allows us to spend a bar or two above it with some less concern), we still have yet to breach the 200-day SMA, and that may cap our advance and it coincides nicely up above with my confluence of fibs.


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