SPY Trends and Influencers July 22, 2017

A weekly excerpt from the Macro Review analysis sent to subscribers on 10 markets and two timeframes.

Last week’s review of the macro market indicators noted heading into July options expiration and the height of summer earnings, the equity markets were looking very strong. Elsewhere looked for Gold ($GLD) to continue its recent move higher while Crude Oil ($USO) bounced in a channel. The US Dollar Index (DXY) continued to look weak while US Treasuries ($TLT) continued their consolidation in a channel.

The Shanghai Composite ($ASHR) remained in a slowly rising uptrend as Emerging Markets ($EEM) continued their break out to the upside. Volatility ($VXX) looked to remain at extremely low levels keeping the bias higher for the equity index ETF’s $SPY, $IWM and $QQQ. Their charts supported this view as well on both the daily and weekly timeframes.

The week played out with Gold continuing the push higher with Crude Oil moving up as well but finding resistance and falling back late in the week. The US Dollar continued the move lower while Treasuries broke consolidation at support to the upside and kept going higher. The Shanghai Composite tested support in the rising trend and bounced while Emerging Markets continued to new 2 year highs.

Volatility stayed in a tight range around 10 after the strong move down last week. The Equity Index ETF’s started the week stable, but then all moved higher by Wednesday. The QQQ and SPY moved to all-time highs Tuesday and IWM joined them Wednesday. All printed another all-time high Thursday before giving a little back Friday. What does this mean for the coming week? Lets look at some charts.

SPY Daily, $SPY

The SPY came into the week after a record high close. Monday saw it digest the move over the prior 6 days to get there with a small body candle that brought the price back inside the Bollinger BandsĀ®. Tuesday pushed to a marginal new high followed by higher closes again Wednesday and Thursday. The weak intraday action Thursday was a foreshadowing of the gap down Friday, but the price moved back up intraday.

It ended the week at a new weekly closing high, just off the 248 Measured Move and the Thursday print, after a small range week of less than 3 points. The RSI continued higher in the bullish zone and the MACD also moved higher on the daily chart. The weekly chart shows the break out clearly over prior resistance. The RSI on this timeframe is strong and bullish with the MACD running flat but turning up to cross up in the short run.

There is resistance at 247.10 the all-time high and a Measured Move to 248 above that in the short term. Longer term there is a Measured Move to 255. Support lower comes at 245 and 242 followed by 240 and 238. Continued Uptrend.

SPY Weekly, $SPY

With July Options Expiry and 1 full week of earnings behind them, the Index ETF’s are looking strong and ready to move higher. Elsewhere look for Gold to continue in its uptrend while Crude Oil pulls back lower in the short run within the longer term drift higher. The US Dollar Index continues to weaken and move lower while US Treasuries strengthen and move higher. The Shanghai Composite continues to drift up while Emerging Markets move higher with strength.

Volatility looks to remain at extremely low levels keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. In the short run their charts look to consolidate or pullback but all look strong and ready to continue higher in the longer timeframe. Use this information as you prepare for the coming week and trad’em well.

Join the Premium Users and you can view the Full Version with 20 detailed charts and analysis: Macro Week in Review/Preview July 21, 2017

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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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