Shares of the S & P 500 SPDR ETF (NYSE: SPY) did not recover
by the end of last week.
Chart Courtesy of StockCharts.com
U.S. stocks start this week under a cloud of fear and expectations
of more volatility and trouble ahead as the politics, the economy,
and the public begin to show signs of fraying, albeit at the
edges, but nevertheless fraying.
From a chartist's point of view, the S & P 500 is now in bear market territory,
by one definition, given that the index is below its 20-day moving average.
SPX broke below its 20 and 50-day moving average recently, and continued taking
out key support levels all of last week, as investors stepped aside.
The other major indexes were mixed as the Nasdaq Composite also broke below its
200-day moving average while the Dow Industrials stopped just short of doing
so.
We're not ruling out some kind of bounce in the next few days. But the S & P
500 has plenty of upside resistance now, which means that sellers that bought
as the market looked stronger and petered out are not holding onto losses and
looking to sell while the selling is good.
That means that more unsatisfactory results are likely in the next few days.
Beyond that, it's just too tough a call right now.
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