SPY: Trend Analysis and Next Support Levels to Watch. (D&W)
The SPY chart presents an interesting mix of price action and technical signals. On the daily chart, the ETF recently encountered resistance around the 565.16 level, which is marked by an all-time high. Now, it is in a bear trend, as the price is making LH/LLs, while it trades below the 21 EMA. Its next technical support is the $537.01, and in the lack of technical evidence suggesting a bottom signal, SPY is supposed to get there.
On the weekly chart, the bearish engulfing pattern that appeared after reaching the all-time high has been a notable signal. This pattern suggests a potential shift in market sentiment, with sellers gaining control after an extended uptrend. The weekly chart also highlights the importance of the 21-week EMA, currently around 529.09, which has historically acted as a dynamic support level. This EMA is a crucial line to watch, as its breach could signal a deeper correction.
The combination of the daily and weekly signals indicates a market in a state of flux. The bearish engulfing pattern and the inability to sustain a rally above the recent highs suggest caution. We can say that SPY is in a mid-term bear trend, while in a long-term uptrend. It all depends on how it'll react around its next support levels, namely the $537.01 (D) and the 21 EMA (W).
For more detailed technical analyses and insights like this, be sure to follow my account. Your support helps me continue providing valuable content to help you make informed trading decisions.
Remember, real trading is reactive, not predictive, so let's stay focused on the key points described above and only trade when there is confirmation.
“To anticipate the market is to gamble. To be patient and react only when the market gives the signal is to speculate.” — Jesse Lauriston Livermore
All the best,
Nathan.
On the weekly chart, the bearish engulfing pattern that appeared after reaching the all-time high has been a notable signal. This pattern suggests a potential shift in market sentiment, with sellers gaining control after an extended uptrend. The weekly chart also highlights the importance of the 21-week EMA, currently around 529.09, which has historically acted as a dynamic support level. This EMA is a crucial line to watch, as its breach could signal a deeper correction.
The combination of the daily and weekly signals indicates a market in a state of flux. The bearish engulfing pattern and the inability to sustain a rally above the recent highs suggest caution. We can say that SPY is in a mid-term bear trend, while in a long-term uptrend. It all depends on how it'll react around its next support levels, namely the $537.01 (D) and the 21 EMA (W).
For more detailed technical analyses and insights like this, be sure to follow my account. Your support helps me continue providing valuable content to help you make informed trading decisions.
Remember, real trading is reactive, not predictive, so let's stay focused on the key points described above and only trade when there is confirmation.
“To anticipate the market is to gamble. To be patient and react only when the market gives the signal is to speculate.” — Jesse Lauriston Livermore
All the best,
Nathan.
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