Monthly time frame:
- The rally from the March 2009 is aging but there is no indication of a top yet.
- So far from the March 2009 low SP500 is up 220%
- The 10 month moving average can be used as a simple rule in order to delimit a bullish cycle from a bearish cycle. During a bearish cycle the 10 mma acts as resistance while in a bullish cycle it acts as support. Therefore as long as SP500 does not print a monthly close below the 10 mma which today stands at 2050 the trend remains up. An end of month print below the 10 mma could open the door to a multi-year bearish cycle with a retest of the break out zone (2000 – 2007 highs) which today is “only” 26% below this month ATH