The historical spread between the S&P 500 high and the 125-day moving average is about 5%-6% (click on the chart to enlarge it).
Right now the spread is close to 5%. Does this mean the market is going to decline and touch (or go below) the moving average?
Possibly. Another alternative is for the market to continue rising and maintaining the 5% spread with the moving average.
One thing is sure, however. Eventually the S&P 500 and the moving average will have to touch.
Pick your strategy. PS. The market outlook of our service is not necessarily that provided by this indicator.
George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager
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