Let’s take a look at our Simple Moving Averages charts. First up the short term SMAs. CLICK CHARTS TO ENLARGE
All SMAs are pointing down and the fastest SMA has now dropped below the slowest. Hence, a lot of “bad” things are happening, but that is no surprise with the SPX now 4% below it’s ATH made over a month ago. Zooming out we see that over the past year, however, this type of SMA setup has happened before, and the current ST SMA chart by itself is not unique or specifically bearish.
Moving on to the Long Term SMA chart, we see that of all bad things that can happen (43 total: price below SMAs, SMAs flattening out, SMAs dropping, SMAs bearishly stacked), several have happened, and as such we can’t value the chart as 100% bullish anymore: price is at the 3 slowest SMA, and the faster moving averages (on top, 7) have flattened out. As such the LT SMA chart is now 81% bullish. If these SMAs are starting to point down, we’ll have to downgrade the chart further depending on how many SMAs start to decline and below which SMA price is.