S&P 500 Cash Equity (SPY)
Hi all, I AM BACK!!! Sorry for stop
updating the site due to some personal reasons, but I am bringing the site back
up again, so please come check it out from time to time. I will do my best to give
you reliable support/resistance levels and underlying trend in the market.
(Weekly)
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The SPY hasn’t broken the uptrend
channel yet, so I expect it to continue higher within the channel. And more
supporting strength should be found as the candlesticks moving closer to the
bottom of the channel
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On top of that, the 50 week
moving average (50 SMA, grey in color) supported the stock around $128.59 for the
last 3 weeks. The 50 SMA offers an extra layer of support if the SPY tries to
drop again.
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The SPY closed on a 3 week high
last Friday, showing some strength in the market. But there is a resistance
level @ $135, which comes from the head and shoulder pattern of last year. If
SPY is able to clear the $135 level, the next major level will be the double
tops resistance/breakout level @ $141.87.
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And notice that the trading
volume in 2012 is quite low comparing to last 3 years. Investors are afraid to
invest due to the European debt crisis; right now they are either keeping their
money off the table or shifting their investments into safer asset classes.
Therefore, I think making short term trade is better off at the current
situation.
(Daily)
-
The SPY tried to breakdown on
the consolidation range and push lower, but then the stock immediately gapped
back up to the range, resulting in a 3 day bear trap that trapped all the short
sellers who shorted the stock underneath the range bottom @ $129.66. A bull/bear
trap is a false breakout and it usually signals a short term trend reversal.
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The rising 200 day moving
average (200 SMA, white in color) is a major support to watch; as it
comes closer to the gap support level @ $129.66, the SPY should be able to stay
above the bottom of the range for a short period of time.
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There are also 2 medium term
supports. The first one is the gap support @ $129.66, which is also the
consolidation range bottom, and the second one is the bear trap low @ $127.14. Once
the SPY breaks below the gap support level @ $129.66, look for a quick gap fill
@ $129.25; and if the selling pressure persists, the stock most likely will retest
the level @ $127.14.
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The news on Greek election came
out on the optimistic side today, so I'm expecting the SPY to push up a little
bit higher this week. However, multiple resistance levels seeing here: range
top resistance @ $134.22, shoulder tops resistance (from weekly chart) @ $135,
and the declining 50 day moving average (50 SMA, grey in color) @ $135.09.
Therefore, I'm looking for a peek-a-poo new high outside of the range here and
an immediate retracement back inside the range.
(Hourly)
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In a smaller time frame chart, you
can see the SPY was trading within a smaller consolidation range @ $131.25 -
$134.22 in the last 7 trading days. This gives us a range reference for next
week’s move.
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If you take a look at the left
side of the chart, you should see an unfilled gap that started around @ $134.5.
If the stock breaks above the shoulder top resistance level @ $135, expect the
SPY to quickly push another $.52 cents and fill the gap @ $135.52.
-
A bullish golden cross appears
in this chart, signaling a continuous bullish trend in the near future. A bullish
golden cross happens when the rising 50 SMA crosses above the declining 200 SMA.
If you look at the left side of the chart, you will see a bearish golden cross
where the 50 SMA crossed below the 200 SMA, the bearish trend continued for
about 3 weeks from thereon.
I hope this post offers you some insight, thank you for reading and please feel free to give me some feedback.
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