The 8 and 34 MA crosses are far too frequent and represent abnormal market behavior. A cross should be followed by a few days favoring that direction, then a cross occurs to favor the other side for a few days. Over the last couple months, the market action has become very erratic and unstable. Seven 8/34 crosses have occurred in the last nine days alone, that is ridiculous. In a nutshell, the technical's want to send markets lower but the Fed's money pump keeps bloating the indexes higher. The blue lines show the sideways channel in play over the last month as highlighted with this morning's one-hour chart.
The indicators show a sideways vibe, perhaps traders waiting to see how bad the bank runs are in Cyprus come tomorrow. Interestingly, Portugal said Cyprus is a template moving forward, agreeing with the Dutch finance minister's comments from yesterday, and surprisingly, the SPX remains buoyant. Maybe no one heard the news since it is lunch time and the traders are busy stuffing their faces with hamburgers and french fries. Watch the Portugal yield moving forward.
For the SPX, if price stays below the 8 MA at 1558.36 it will force the 8 to curl over to the downside to head for a bear cross. If bulls keep the SPX above 1558.36, they will float the markets into the closing bell. For now, the 8 MA is above the 34 MA forecasting bullish markets for the hours and days ahead. The more regular relationship of the 8/34 cross, with less crosses occurring, will reappear as the days and weeks play out. Markets remain at an inflection area now. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
