summary
The stock market has come back to life after some scary moments last week. Over the past three days, the S&P 500 (SPX) has gained almost 3%, while the Nasdaq and Nasdaq 100 (QQQ) have regained more than 3%. SPX is up 3.6% from last Friday’s intraday low, Nasdaq is up 4.5% and QQQ is up 4.2%. SPX is rapidly regaining its 50-day average, and the crossover between the 5-day and 13-day exponential moving average (EMA) is approaching a bullish direction. The NASDAQ and QQQ 5-day/13-day EMAs have already returned to bullish territory. All three indexes have recovered more than 61.8% of their recent losses and are not far from new all-time highs. An indicator similar to Bollinger Bands is the price channel. The daily chart uses a 20-day price channel. The upper channel is equal to the 20-day high and the lower channel is equal to the 20-day low. The center channel is the midpoint of the other two channels. There are many ways to interpret price channels. These can be used for support and resistance, overbought and oversold areas, the start of a strong uptrend breaking out of the upper channel, or vice versa. Since October 2023, SPX fell below the lower channel, but quickly rebounded
