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As of Friday morning, the spread between the price of the DJIA and its 50-day moving average [DMA] was -6.29%, the lowest level since March 2003, indicating a severely oversold market.

While this means the index is due for a short-term bounce, it also means we are in new territory for the current bull market. Until the index can break back above its 50-day moving average, we are treating this as a trading range market.

click to enlarge

Source: Dow 50-DMA Spread At Lowest Level Since 3/03