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This is the S&P chart as of yesterday 1/7/2022. An analyst said that the S&P had reached its 50-day low and if it does not go higher, it will reach its 100-day low.

My questions are:

  1. Who is controlling the 50-days & 100-days chart to follow this pattern? Are they Fund Managers from various investment firms?
  2. Is this Moving Average pattern trustable so the S&P can't crash below the 100-days average?
  3. Are these drops expected like a few times every year or it is trigged by some major events?

enter image description here

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    You see that little dip in Sep/Oct? That's below the 100day average which pretty much answers your 2nd question. More importantly though, do you know what a "moving average" means?
    – csiz
    Jan 9 at 20:48
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    If it were so easy to make a profit by buying at a point in time that anyone can calculate in 5 minutes with a spreadsheet, then everyone would be doing it. There are no easy methods like this for making money in the markets; anyone who tells you otherwise is either trying to sell you something or doesn't know what they are talking about.
    – JBentley
    Jan 9 at 22:50
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Who is controlling the 50-days & 100-days chart to follow this pattern? Are they Fund Managers from various investment firms?

No one "controls" these patterns - they are just reflective of market prices based on all trading activity. The analyst was making a prediction, not an assertion. They could likely be wrong.

Is this Moving Average pattern trustable so the S&P can't crash below the 100-days average?

No. It could go up a lot, go up a little, stay the same, go down but not past the 100-day average, or it could indeed go down and crash through the 100-day average. There's nothing that would prevent it from going through the 100-day average.

Are these drops expected like a few times every year or it is trigged by some major events?

It depends on whether you believe that technical analysis is deterministic or not (I do not). It might tend to happen every few years, but whether that's just coincidence or not is hard to know, since there are thousands of factors that affect the stock market as a whole.

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    "but not past the 100-day average, or crash through it." Are you saying that a security cannot crash through the 100-day moving average? Please see SPY on 3-9-2020.
    – chili555
    Jan 10 at 15:36
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    No, that was a distinct 5th option. Poor placement of modifiers - edited.
    – D Stanley
    Jan 10 at 15:52
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I agree fully with D Stanley's answer but wanted to add one more thing:

"An analyst said that the S&P had reached its 50-day low and if it does not go higher, it will reach its 100-day low."

In other words: if the price doesn't go up, it will go down.

That is a profound as: if we don't win the game, we will lose.

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  • It can reach to the 100-day low and then will bounce back from there to up is what he meant. Jan 15 at 15:41
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No one directly controls these moving averages. Price is a function of supply and demand. Moving averages are just arbitrary lines drawn on a chart.

In trending up markets like 2021, they work very well. In corrections, they perform poorly (see late 2018 when the market was spooked by the [prospect of a trade war with China as well as the deep Covid correction in March of 2020).

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