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S&P Poised to Bounce at 2855 Support; See Choppy Action

February 28, 2020
S&P Poised to Bounce at 2855 Support; See Choppy Action

It’s been a rough week and I think the market is deeply oversold on a wide range of technical metrics, two in particular. Both traders and investors should be aware of these two, following this week’s historic decline in equities. (For more see page 1.)

First, short-term technical indicators are at extreme levels, which have historically supported a rebound. However, while my expectation is for a trading rebound to develop from here, there is no meaningful evidence to state a bottom is developing.
Every technical analyst is taught that support levels are meaningless unless price responds to those levels. The Standard & Poor’s 500 index slicing through theoretical support at its 50- and 200-day moving averages is a case in point.

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