On the simple moving averages we bounced off the 200 day moving average, on schedule yesterday and rallied before selling off late in the day. The problem for the bull case here is the 200 day (simple) moving average is moving down at a rate of 2-3 points a day - yesterday it was 906, today 904.
On the exponential moving average yesterday was just a blah day, a bounce after a relatively dramatic drop.
Very cloudy with 2 sets of data points telling us different things. In both charts you will see the 50 day moving average below and within a week or so I'd expect it to "cross" the 200 day simple moving average. Normally that is bullish but usually that happens when the 200 day moving average has an upward slope, not a downward.
For now it is sort of no man's land as long as we hold the 200 day simple moving average... tonight we have Research in Motion (RIMM) earnings after the bell which will affect the mood tomorrow and then next week is our last week ahead of the quarter. The market for a few years now has been infamous for rallying in the few days before quarter end so fund managers books look better than they really are. We shall see if that plays out next week. That';s the 40,000 point of view - the action under the surface centers around the commodity / reflation trade that is overowned, and I'd argue very premature. But that's where much of the money has been made so it will continue until it blows up.
