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Tuesday, August 21, 2007

SP500 stuck below its 200 day moving average

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While I am at heart a fundamental investor, ignoring the basics of technicals is a fools game. I generally don't chart the markets that much, but with the recent turmoil and with an eye to trying to figure out the market near term, I did pull a SP500 chart and noticed the 200 day moving average (exponential) is around 1453. Even with the rallies the past few days the SP500 has closed below this level the past 2 days, and remains below it today.

Interestingly, the NASDAQ has closed right ABOVE its 200 day moving average (roughly 2495) the past few days, but literally by a few points.

Russell 2000 is well below its 200 day @ 800

Only the Dow itself is firmly above its 200 day, but with its concentration on just 30 stocks, mostly multinationals I only watch it as a sentiment gauge. It's reflection of the market as a whole is misleading.

I'm remaining cautious at this point.

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