The 50-day moving average has been the parallel bar around which the major indexes are spinning, but today we saw oil stocks help to power the S&P 500 Index through its 50-dma. As I indicated in last night’s video report, this would be constructive as the S&P now joins the NASDAQ Composite Index, which regained its 50-dma last week.
NASDAQ Composite Index pushed further above its own 50-dma on higher volume today in a strong move. It also cleared the April highs, which in my view isn’t necessarily all that meaningful since I pay closer attention to the stocks. With things looking as good as they are, we must be open to the possibility of a pullback. But the good news is that the 50-dmas on all the major market indexes serve as very convenient references for near-term support.
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