Trapped In A Trading Range

Hello traders everywhere. There was no doubt that the market would bounce back today after a losing day on Tuesday, after all, that's the cycle we've been in for a while now. But more importantly, it's the trading range that we're currently stuck in. Not familiar with the term "trading range?"

A trading range occurs when a security trades between consistent high and low prices for a period of time. The top of a security's trading range often provides price resistance, while the bottom of the trading range typically offers price support. In this case, we will be looking at the 50-day and 200-day moving averages. With that definition mind, let's take a look at the major indexes.

All three major indexes, the S&P 500, DOW and NASDAQ, are all stuck in a trading range between the 50-day and 200-day moving averages. This range began almost exactly one month ago on August 5th, where we saw all three indexes lose roughly -3%. The NASDAQ led the way with a daily loss of -3.4% with the S&P 500 and DOW close behind with losses of -2.9%. Since then they have failed to break out above their 50-day MA's, the level of resistance, while the 200-day MA is providing a level of support.

Key Levels To Watch This Week:

Every Success,
Jeremy Lutz and