Chart of the Day - Wednesday, September 20, 2023

Today’s Chart of the Day was shared by John Roque (@daChartLife). Bulls and bears have been at a stalemate for nearly two months, but the bears seized control of the near-term trend today. The S&P 500 appears to be resolving lower out of a narrowing pattern, as it violated the lower bounds of the pattern today. This pattern suggested that pressure was building for a large move, or trend, in either direction. John points out that today's action opens the door for a -4.5% drop to support at 4,200. It would make a lot of sense to revisit 4,200, or "The Mendoza Line," as John calls it. This level coincides with the 200-day moving average, and it's come into play numerous times over the past two years. Remember, we're in the midst of what has historically been the worst two weeks of the year for the S&P 500.