Wednesday, August 10, 2011

Here comes the 50/200 dma cross...

One indicator that always seems to get armchair technicians fired up is when the 50 day moving average crosses the 200 day on the S&P 500.  This phenomenon is often affectionately referred to as the "death cross" because of the carnage that may follow.  Certainly there will be some chatter about this over the next few days as we approach the cross; however, we did have a cross last year during 2010's summer swoon.  That proved to occur almost exactly at the 2010 lows, so it's not a fool proof measure by any means.

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