Chart of the Day - Monday, February 26, 2024
February 26, 2024
🏆 Today’s Chart of the Day was shared by Grant Hawkridge (@granthawkridge).
- ‘The Golden Cross’ often fails as a timing tool or trading signal, but every longer-term rally starts with a golden cross. You can’t have a sustainable uptrend without the 50-DMA crossing above the 200-DMA.
- Grant points out that 73% of S&P 500 stocks are currently on a Golden Cross signal – the most since October 2021.
- It would be a red flag if this indicator were diverging, but it’s hitting multi-year highs, confirming the uptrend in the S&P 500.
The takeaway: This is just one of many data points to consider, and history doesn’t have to repeat itself. But, since the 1950s, this has consistently led to above-average gains with mild pullbacks in the remainder of the year.