Stocks quoted in this article:
With today being the last day of the month, the S&P 500 Index (SPX – 1407.16), Nasdaq Composite (COMP – 3242.2), and Dow Jones Industrial Average (INDU – 10,859.3) all entered this morning's trading sitting close to their respective 20-month moving averages.
The SPX's 20-month trendline is now perched at 1390, just eight points below yesterday's close. The COMP remains beneath its 20-month moving average, which is currently resting at 3400. The technology-laden barometer last finished a month below its 20-month trendline in August 1998. AS for the Dow, it has overtaken its 20-month trendline this morning, as the long-term moving average is at about 10,835.
We view the 20-month moving average as the line of demarcation between bull and bear markets.