Data Driven…

Equities got walloped today as weak economic news hit the wire along with the continuing turmoil in the middle east. What’s more is the Dow chart, the S&P 500 chart and the Nasdaq chart all have broken through and closed below their 50 day moving averages. On Sunday’s blog we spoke about “the moving averages” and how this is a technical analysis tool utilized by many market technicians and institutional investors. For the better part of 6 months these leading indexes have managed to comfortably trade above their 50 day and significantly above their 200 day moving averages. So what does all this mean? Well the coming days will tell us whether or not this was a one day violation of the 50 day or if this is the beginning of a extended sell-off?

I think for now the markets will continue to be hyper-sensitive to the incessant data and news flow especially out of the middle east. Patience is key especially in an emotional market like the one we find ourselves in.

Have a good evening.