The S&P 500 crashes below 3,000 moving conclusively below the 200 DMA
- The S&P 500 has pushed 0.61% lower adding to the crash seen on Thursday.
- The price has broken the 200 daily period Simple Moving Average to the downside.
S&P 500 daily chart
The S&P 500 has pushed lower again on Friday after trading in the black at the start of the session. The major US index sold off heavily on Thursday after news that the coronavirus cases could be increasing again in the US.
This seems like a strange narrative given the fact that the US has never got to grips with the COVID-19 pandemic from the get-go. It seems the market will attach itself to whatever themes it deems fit at the time.
Looking closer at the technicals now, the price has moved below the psychological 3K level. Not only that, the 200 Simple Moving Average has now conclusively been broken to the downside.
Those traders and analysts that look at wave patterns might not be too convinced though. A lower high has not been printed yet so this could just be a deep retracement but time will tell.
On the indicator front, the Relative Strength Index has finally pulled away from the overbought zone and the MACD has printed red. The only ray of hope is the fact that the signal lines on the MACD are still above the mid-line.
The trendline had a textbook retest and break lower on the lower timeframes. You can see the red diagonal line was broken on Thursday but on the hourly, it becomes apparent that the price came back to retest the zone before pushing lower. This is often the case when it comes to trendline breaks.
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Author
Rajan Dhall, MSTA
FX Daily
Rajan Dhall is an experienced market analyst, who has been trading professionally since 2007 managing various funds producing exceptional returns.
