The S&P 500 (SPX), Dow Jones Industrial Average, and Nasdaq Composite daily charts have their 50 – day Simple Moving Average (SMA) lines crossing below their 200 – day SMA lines. This is called a “Death Cross” and is usually a signal for more downside action.
The daily SPX chart courtesy of Trading View shows what happened.
After the Death Cross on 04/14/25 the SPX has moved lower. However, it has moved beyond the time window for a possible crash. Please see the 04/08/25 blog “The 55 – day Crash Phenomenon”.
Could an important bottom have been made on 04/07/25? It’s possible, sometimes in a fast-moving market significant lows can be made before a Death Cross.
Daily momentum oscillators argue against this scenario. Note that on the SPX lowest closing price made on 04/08/25 both RSI and MACD had maximum downside readings. Most of the time significant stock market bottoms are made with at least one bullish momentum divergence.
There’s also significant overhead resistance just above the powerful 04/09/25 peak. In the short term if SPX can rally into this zone there could be heavy selling by trapped bulls that bought in that area.
The daily SPX chart from the 2022 bear market may reveal clues about what may happen in the coming weeks.
Note that in June 2022 the SPX made an important bottom without any bullish momentum divergences.
Later SPX went below the June 2022 bottom and terminate the bear market with bullish RSI and MACD divergences.
Assuming SPX does not rally back to the overhead resistance zone, there’s a good chance SPX goes below the 04/07/25 bottom sometime in the next few weeks.
Four Dimension Trading 