Last week, the S&P 500 breached that level for the first time since November 2012, which predictions that once the S&P 500 fell below about 1,905 it would keep dropping playing out.
But in the last few days stocks have rebounded, and now we are back at the 200-day moving average, putting the market at a bit of a show-me point.
In an email on Tuesday, Tom Fitzpatrick and the technical analysis team at Citi said, “The S&P 500 is testing decent resistance at 1,904-1,907 where the 200 day moving average converges with the August low. A close above here would add weight to the bias that the correction seen over the past month has likely ended.”
In early trade on Tuesday, the S&P 500 was up about 14 points to 1,918, popping above the resistance level mentioned by Citi.
So now we see if it holds.