Is the market signaling a bottom is in?
The S&P 500 breached a very important technical milepost this week. That could put a floor on any losses.
The stock market is little changed this month.
But without much fanfare, the market told investors this week that the bottom that came in March was real.
That could mean the market has a good chance of heading higher. Here's why.
On Tuesday, the 50-day moving average of the Standard & Poor's 500 Index ($INX) moved above the index's 200-day moving average.
The last time the index saw what some analysts call the golden cross was in March 2003, which was when a big breakout occurred after the dot-com bust.
This is a very important technical signal. The Nasdaq crossed over in May; the Dow Jones industrials ($INDU) could see the cross in the next few weeks.
In December 2007, when the 50-day moving average dropped below the 200-day average, the bear market erupted. With force. With extreme pain.
This is not to say that the market is poised to shoot sharply higher.
As noted, the market is now trading sideways.
The Dow and the S&P 500 are up only slightly this month compared with gains of 7% or more in March and April and 4% and 5%, respectively, in May. The Nasdaq jumped 11% in March, 12.44% in April and 3.3% in May.
But it does suggest that any sell-offs could be modest.
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[BRIEFING.COM] Equity indices closed out the month of August on a modestly higher note. The Russell 2000 (+0.6%) and Nasdaq Composite (+0.5%) finished ahead of the S&P 500 (+0.3%), which extended its August gain to 3.8%. Blue chips lagged with the Dow Jones Industrial Average (+0.1%) spending the bulk of the session in the red.
The final week of August represented one of the quietest stretches for the stock market so far this year. The first four sessions of the week produced the ... More
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