SPY Trends and Influencers August 14, 2021

• Posted by Greg Harmon
• on August 14th, 2021

Last week’s review of the macro market indicators saw, with the first week of August in the books, equity markets showed strength in large caps and tech after a weak start, with the small caps still rangebound. Elsewhere looked for Gold ($GLD) to continue the reversal lower while Crude Oil ($USL) consolidated in a pullback. The US Dollar Index ($DXY) reversed to the upside while US Treasuries ($TLT) reversed lower. The Shanghai Composite ($ASHR) looked to be stalling in the uptrend while Emerging Markets ($EEM) stalled at a lower high.

The Volatility Index ($VXX) looked to remain very low making the path easier for equity markets to the upside. Their charts looked strong, especially on the longer timeframe. On the shorter timeframe both the $SPY and $QQQ looked ready to continue higher while the $IWM continued in consolidation.

The week played out with Gold finding support near the open Monday and reversing higher with strength while Crude Oil also reversed back up toward resistance. The US Dollar met resistance as it touched the July highs and sold off while Treasuries continued to move lower until a rally on Friday. The Shanghai Composite resumed the uptrend but met resistance at the end of the week while Emerging Markets fell back from a lower high.

Volatility fell all week to end near 18 month lows. This put took pressure off equities but the response was mixed. The SPY started higher by mid week making new all-time highs. The QQQ initially fell back from its high only to recover by Friday. The IWM continued to mark time moving sideways as if nothing was happening. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY came into the week at an all-time high. It held there Monday in a narrow range day and followed that up with two more tight range days, both making new all-time highs, Tuesday and Wednesday. Thursday the range expanded with another high and it ended the week with a 4th new high. The SPY was up less than 1% on the week. The daily chart shows the drift higher with the RSI rising in the bullish zone and the MACD lifting above the signal line and positive. The Bollinger Bands® continue to point higher with price near the top of them.

The weekly chart shows the strong trend higher as well. The RSI is pushing into overbought territory, strong in the bullish zone. The MACD is flat at the highs. The Bollinger Bands are starting to get narrower as they point higher on this timeframe. There is no resistance higher but the 200% extension of the retracement of the pandemic drop is at 458. Support lower comes at 441 and 437 then 435.50 and 430.50 before 428.50 and 425.50. Uptrend.

SPY Weekly, $SPY

Equity markets were a mixed bag this week as the market moved into the low volume dog days of August. Elsewhere look for Gold to continue its bounce in the pullback while Crude Oil consolidates in a tight range. The US Dollar Index continues to consolidate after the move to the upside while US Treasuries may be resuming their uptrend. The Shanghai Composite looks to consolidate while Emerging Markets continue to pullback toward long term support.

The Volatility Index looks to remain very low making the path easier for equity markets to the upside. The charts of the SPY and the QQQ both look great on the longer timeframe with the SPY also looking good for more highs in the short run. The QQQ looks to continue to pause and digest at its highs. The IWM continues to look like the party pooper, stuck in a long flat consolidation that is nearing 8 months long without any change in sight. 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 August 13, 2021  

If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.

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.

blog comments powered by Disqus