SPY Trends and Influencers: Monthly Edition April into May 2013

Last month in this space my Monthly Macro Review/Preview had the monthly outlook suggesting the consolidation for Gold ($GLD) and Copper ($JJC) would continue with both biased lower on a break, while the trend continued lower for Crude Oil ($USO) and Natural Gas ($UNG) continued higher. The US Dollar ($UUP) and US Treasuries ($TLT) continued to be biased higher but with a stronger bias to the Dollar and Treasuries showing signs of weakness. The Shanghai Composite ($SSEC) and Emerging Markets($EEM) looked to continue to move lower with Emerging Markets possibly reversing while the German DAX ($DAX) looked strong while at long term resistance. Volatility ($VIX) could go either way but regardless looked to remain low and near historic lows. With that tailwind, the Equity Index ETF’s $SPY, $IWM and $QQQ were set up to continue higher in the coming months. How does an additional month impact the longer term picture? Let’s look at some charts.

As always you can see details of individual charts and more on my StockTwits feed and on chartly.)

SPY, $SPY
spy

The SPY broke to new all-time highs in April as it pushed to the mid line between the Upper Median and Median Lines of the bullish Pitchfork. Above the mid line, look for the Upper Median Line to draw it higher. As it gets here the RSI is bullish and rising with a MACD that is also rising. These support continued upward price action. All Measured Moves higher have been achieved, but that does not mean it cannot keep going. A 113% extension higher gives a target of 169.25 and 127% beyond that takes it to 181.95. Support lower is found at 153.50 and 145. Continued Upward Trend.

The monthly outlook suggests that the long party for Gold is ending and Copper is joining it lower. Crude Oil looks to continue to move in a tightening range while Natural Gas runs higher. The US Dollar Index also looks to flounder sideways as US Treasuries resume their uptrend. The Shanghai Composite looks to continue to move lower as Emerging Markets continue to consolidate and the German DAX looks better towards new highs. Volatility can go either way but looks to remain low with the VIX heading towards a historic low range. These factors in aggregate support further upside movement for the Equity Index ETF’s, SPY, IWM and QQQ. Treasuries moving higher may seem counter intuitive to rising equity prices but there is historic precedent for it for extended periods of time. Use this information to understand the long term trends in Equities and their influencers as you prepare for the coming months.

For complete analysis of the 13 markets summarized here join the premium service and read Macro Month in Review/Preview April into May 2013 or send me an e-mail requesting a special Macro package.

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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