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The bulls passed the test of the 50 day moving average on the S&P 500 during this morning’s brief dip. In essence, the price action has quieted down significantly compared to what we saw over the past several weeks. After a sharp 7% correction earlier this month, followed by a stunning upside reversal, a more subdued market is naturally next in the line of progression.
My thinking remains that we have some clear parameters for a trading range, with 1300 representing the lower boundaries, while 1330 should act as resistance. We also seem to have to have the type of underlying price action that one would associate with a trading range, seeing as some areas of the market are notably weak, while others are impressive in strength. Either way, we know where our lines in the sand are.
