Johnson Controls Spiking Above 200-Day Moving Average; Testing 50-Day Moving Average as Resistance

The moving averages track the previous price action in a stock. In this case, the 200-day moving average compiles the average share price of the last 200 trading days and the 50-day moving average compiles the average share price of the last 50 trading days. Both of these moving averages are considered important to the technical trader. Perspective: Price above the average is perceived as positive while price below the average is negative. Currently, Johnson Controls JCI has broken above the 200-day moving average (a positive), while using the 50-day moving average as resistance. Traders will look to see if an increase in volume is present if shares break above the 50-day moving average, which could send shares higher. Though, shares could move lower from the 50-day moving average and test the 200-day moving average, and a break below the 200-day could send shares lower.