The S&P 500 is at a key technical level. The bounce-back rally from the March low has failed to surpass the February 18th high. The index is forming a double top, and looks poised to break below its 50-day moving average. A close decidedly below the 50-day average could result in a more extended correction. How big of a correction? On a technical basis, there is minor support for stocks at 1,250 and again around 1,200, but I don’t see meaningful support for stocks until the S&P approaches the 1,100 level—that’s a long ways down from today’s level of 1,312.
Jeremy Jones, CFA, CFP® is the Director of Research at Young Research & Publishing Inc., and the Chief Investment Officer at Richard C. Young & Co., Ltd. Richard C. Young & Co., Ltd. was ranked #10 in CNBC's 2019 Financial Advisor Top 100. Jeremy is also a contributing editor of youngresearch.com.