The S&P 500 Index’s 2.1% drop in morning trade Wednesday has taken it 10.2% below its 200-day moving average, which currently extends to 2,052.49. That’s the farthest below the widely-watched long-term trend indicator the index has traded at since October 2011 correction, according to data provided by FactSet. During the mini-crash in August 2015, the S&P 500 fell to a low of 10.05% below its 200-day MA before recovering. While many might see the S&P 500’s current distance from its long-term trend as a sign that the stock market is technically oversold, there’s a saying among many technicians, that oversold doesn’t mean the selloff is over. On Oct. 3, 2011, the S&P 500 bottomed 14.08% below its 200-day MA. During the Great Recession, the S&P 500 had plunged as much as 39.6% below its 200-day MA on Nov. 20, 2008. At the depths of the dot-com crash, the S&P 500 has 22% below its 200-day on Sept. 21, 2001.
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