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EMA Contradiction

As far as technical indicators go EMA's (exponential moving averages) are used actively to determine trends and trend changes.  Specifically, the 50/200-day EMA is often cited as a major technical indicator, and when the 50 crosses then trends are considered changed.

To date, the 50/200-day EMA has yet to indicate a reversal to a bear market, but the averages have converged leading many to believe a crossover is imminent.  With today's move, the bands are beginning to move away from a crossover, suggesting the Bull Market is intact.

Now, by simply changing the daily chart to a weekly chart, you'll note that the 50 week band has yet to cross above the 200, suggesting that the longer-term view remains with the Bears, meaning that we have yet to reverse the bear market.  I suspect that this particular indicator is reason enough to expect that downside pressure could continue.  If the 50 week band crosses above the 200 week band, then the Bulls are certainly in control, however, we're not there yet.



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