S&P 500 right back to the 200 day. Wrong side of it – but it’s something. pic.twitter.com/e0HpB2yvPu
— Jay Woods (@JayWoods3) January 28, 2022
Today’s Chart of the Day was shared by Jay Woods (@JayWoods3). It’s a daily candlestick chart of the S&P 500 over the past year. Despite all the volatility this week, the S&P 500 actually managed to close slightly higher on the week by 0.77%. Jay points out that we closed a hair below the 200-day moving average. We broke below it last Friday, and couldn’t close above it all week. Contrary to popular belief, the S&P 500 has performed quite well after breaking the 200-day moving average in the past. According to Schaeffer’s Investment Research, the S&P 500 has broken below its 200-day moving average 34 times since 1990. One month later, the index has historically been higher 74% of the time for an average gain of 1.80%. Check out the full backtest results here.