For three weeks in late June and early July, the S&P 500 SPDR Trust (SPY) lingered below a key 50-day trendline.
Ultimately, SPY broke back above its moving average and then rocketed to fresh all-time highs.
Perhaps ironically, the pattern appears to be repeating itself. (Sort of.)
If SPY blasts above 50-day resistance and holds it, one might anticipate brand new records for U.S. stocks.
On the other hand, if resistance at the the 50-day holds for much longer, one should factor in the possibility that SPY could drop 6% from current levels; SPY might trade near the 156 mark.
Gary Gordon is president of Pacific Park Financial, Inc.