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Today, the S&P 500 notched its eighth straight day of gains, bringing its cumulative return during the streak to an impressive +8.7%. This marks the first such streak since last November, and if gains continue tomorrow, it will represent the longest consecutive advance since 2004.

Interestingly, the index has now climbed above its 50-day moving average for the first time since February. However, it still trades about 2.5% below its 200-day moving average—a threshold many technical analysts view as critical for confirming a long-term trend reversal.

Historical analysis by @SubuTrade offers perspective: since 1927, there have been only 8 instances when the S&P 500 closed higher for 8 consecutive days while remaining below its 200-day MA. The short-term outcomes were generally disappointing: the average return over the following month was -3.13%, with positive returns in only 50% of those cases. More notably, within two weeks after such streaks, the average return was -0.72%, and gains were seen in only 38% of cases.

This pattern suggests that current strength may reflect a temporary bounce rather than a sustained breakout—especially when long-term moving averages remain unbroken.

Conclusion
While the current rally inspires optimism, historical evidence urges caution. Investors should view the 200-day MA as a critical technical level and prepare for potential near-term volatility. Proactive risk management will be key as the market tests whether this rally can transition into a lasting uptrend.

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