"This recent correction – a long overdue correction – is an outstanding place to put money to work for those who have been waiting for just this type of a pullback," says Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson. "Yesterday's low of 1,772 is a great place to put that money to work."
(Read: Wall Street eyes emerging markets, Fed announcement)
According to Ross' charts, the S&P 500 has been trading with a single trend line as support for well over a year. That trend line has roughly matched the 100-day moving average since the S&P 500 last tested both in August 2013. On Monday, the index's low was 1,772.88, less than nine points above the 100-day moving average. For Ross, that's the best prices investors will get for the index for the near future.
"I think this is a great place to put your money to work," says Ross. "I would be a buyer here of the S&P, the broad market, and those individual names that you've been waiting to buy on a pullback."
While Ross may have a trend line, CNBC contributor Andrew Busch, editor and publisher of The Busch Update, sees a full trend channel in recent charts of the S&P 500. That channel is 165 points from top to bottom, with the top part hitting between 1,849 to 1,850 back in December.
Like Ross, Busch sees a short-term entry level roughly around the 100-day moving average (on Busch's charts, it's somewhere around 1,768 or just four points below Ross').
Busch sees the current bottom of the trend channel as a potential intermediate- or longer-term entry level. Currently, that price is 1,704.
"We've had such a significant rally," says Busch about the S&P 500's 2013 performance. "We're backing off a little bit. The data's coming out as a little bit weak. And, of course, we get the Federal Reserve this week which will continue tapering. My guess is the first quarter of this year will be pretty soft for the S&P…. If you haven't put your money to work yet, I would wait until the lower level of 1,704 for the S&P."
Due to the technicals, Richard Ross believes the recent pullback in the S&P 500 was inevitable. Attempts to cite recent trouble in emerging markets as a catalyst for the drop in the S&P 500 is unfair, he says.
(Watch: Who will pay the price for the emerging market mess?)
"Emerging markets and their corresponding currencies have been week for months and years," says Ross. "This is not a new story here. This is just a convenient scapegoat for a long overdue pullback. Put those fears aside and you want to be a buyer over time. If it pulls back to 1,700, that's even better not for short-term traders but for longer-term investors. "
To see the full discussion on the S&P 500 by both Ross and Busch on the technicals, watch the video above.
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