This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

How Low Can the S&P 500 Go?

NEW YORK (TheStreet) -- For short-term traders, last week was rough. It was difficult to make money on either side, long or short. With such a volatile and choppy environment, set-ups are more likely to fail and trying to anticipate the next move is a guessing game.

This week could be no different or worse. We have geopolitical strife with Ukraine. We have the Federal Reserve's Federal Open Market Committee and the ongoing asset-purchase tapering, plus options expiration.

Although I do not believe we have seen the so called "top," and that the bull market has more room to run, I am seeing more to be concerned about in the short term.

First, for the first time in months, I am seeing better short set-ups than long ones. Second, we are not yet considered oversold based on a popular metric measuring stocks below their 20-day moving averages.

Third, the recent breakout in the S&P 500 during the first week of March that took prices over 1880 represented a new 20-day. This high was not confirmed with 20-day highs in stocks, which is considered to be a divergence.

Finally, during last week's drop there was a lot of technical damage done to many high-flying momentum stocks last that deserves our attention.

Not yet considered oversold




New SPX 20-day highs were never confirmed with new 20-day highs in stocks:



Levels to watch:

We are very close to hitting the 50-day moving average  (at 88.30) on the Nasdaq, as seen by the PowerShares QQQ Trust (QQQ), and I would be surprised if we didn't at least visit it. We are a bit further away on the S&P 500 and iShares Russell 2000 Index (IWM), but they are looking more and more likely to be paying a visit in the near term. Read the notes on all three charts.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
YHOO $44.95 0.00%
TSLA $190.57 0.00%
AAPL $126.37 0.00%
FB $83.20 0.00%
GOOG $552.03 0.00%

Markets

DOW 17,976.31 +263.65 1.49%
S&P 500 2,086.24 +25.22 1.22%
NASDAQ 4,947.4410 +56.2220 1.15%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs