Technicals | Aug 30 2022
By Michael Gable
The bounce in stock prices is a memory now and we are back to seeing a lot more cautiousness in the market.
We have an updated chart of the S&P500 Index in today's report to further show how we are seeing it all play out.
Despite the market looking more bearish again, energy stocks continue to look strong. Last week, we made the point that energy stocks were on the move again and we had a few buying opportunities.
We turned positive on the S&P500 Index in July. Our commentary since then has noted that it needed to clear 4200 and then the next stop was the 200-day moving average, which would offer strong resistance.
We can see that the market has clearly found resistance at the 200-day moving average (blue line) and is now consolidating. The risk for now is the downside, but having said that, the strength of the June-August rally suggests that the June low may hold.
We are likely to see the S&P500 Index consolidate further for a few more weeks before we get the next turning point.
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Michael is RG146 Accredited and holds the following formal qualifications:
• Bachelor of Engineering, Hons. (University of Sydney)
• Bachelor of Commerce (University of Sydney)
• Diploma of Mortgage Lending (Finsia)
• Diploma of Financial Services [Financial Planning] (Finsia)
• Completion of ASX Accredited Derivatives Adviser Levels 1 & 2
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