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Straits Times 3,116.90 -10.84 -0.35%
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S&P 500 Achieves “Golden Cross”
Trend Spotting | 17 June 2009
By: Xavier Lim
Articles (51) Profile

On 01 Jun-09, the S&P 500 topped the 200-day moving average for the first time since Dec-07. The jump followed a bounce in the 25-day moving average crossing beyond the 200-day moving average, which was also a first since Nov-07.

The aforesaid, coupled with the fact that short-term averages are higher than long-term averages, indicates that this stock rally is for real (only for short-term based on daily chart). The outperformance of these shorter term averages signals trading momentum is likely to remain positive and once the S&P 500 recovers after some pullback, the index may continue its upward trend until around the psychological level of 1,000.

3-year period daily chart for S&P 500
Armed with an arsenal of investment knowledge, Xavier is the Senior Research Editor at Shares Investment.

Please click here for more information about this author.


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