At one account I visited in London yesterday, a PM observed: “It’s just crazy that the outlook for the global financial system depends on the whims of 11 million Greeks.” The Greek drama clearly has investors on the edge of their seats. The S&P 500 is also on the edge of its 200-day moving average, which was 1265.39 at yesterday’s close. The actual index is down 6.3% to 1278.36 since peaking this year at 1363.61 on April 29. Last year, it peaked on April 23 and bottomed on July 2 after dropping by 16.0%. Back then it fell below its 200-dma during the summer.
The price of a barrel of WTI crude oil is also on the edge of its 200-dma, which was $92.91 yesterday. This morning, the actual price is $94.03. During the financial crisis of 2008, this price fell below its 200-dma on September 2. It continued to plunge in a free-fall until it bottomed on December 19 at $33.87.