SPY Trends and Influencers September 9, 2023

Last week, the review of the macro market indicators saw heading into the unofficial end of summer Labor Day holiday, equity markets showed resilience with a rebound higher off support ending the downtrend. Elsewhere looked for Gold ($GLD) to continue to consolidate near its high while Crude Oil ($USO) looked to start a trend higher. The US Dollar Index ($DXY) continued its short term trend to the upside while US Treasuries ($TLT) stalled in their pullback. The Shanghai Composite ($ASHR) looked to pause in the downtrend while Emerging Markets ($EEM) consolidated.

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 $QQQ and $SPY also looked better to the upside. The $IWM looked strong on the shorter timeframe but stuck in consolidation on the longer scale.

The week played out with Gold drifting lower to support while Crude Oil rose early in the week and then met resistance and consolidated. The US Dollar continued to the upside while Treasuries held lower in a narrow range. The Shanghai Composite jumped early but then gave up all the gains by Friday while Emerging Markets moved lower.

Volatility rose early but then fell back Friday to end little changed. This put initial pressure on equities and they responded by starting the week moving lower. All but the IWM found support by Thursday and reversed Friday. The IWM remained weak all week. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY came into the week moving higher off a pullback on the daily chart. It started lower Tuesday though, reversing the direction at a lower high. It continued lower touching the 20 day SMA Thursday before bouncing and holding Friday. The RSI has pulled back to the midline with the MACD positive but heading lower. The Bollinger Bands® on this timeframe are now flat.

The weekly chart shows an inside week. The Bollinger Bands on this longer timeframe are still open higher with the RSI in the bullish zone and the MACD level after crossing down and moving lower in the bullish zone. There is support at 444 and 437.50 then 435.50 and 430 before 428.50 and 425.50. Resistance higher is at 447 and 451 then 454 and 457 before 460 and 463.50. Pullback or Consolidation in Longer Uptrend.

SPY Weekly, $SPY

Heading into the September options expiration, equity markets showed some exhaustion after a promising move higher the prior week. Elsewhere look for Gold to continue its pullback while Crude Oil continues to move higher in a break out. The US Dollar Index continues to move to the upside while US Treasuries continue their pullback. The Shanghai Composite looks to continue to move lower while Emerging Markets consolidate in a range.

The Volatility Index looks to remain low making the path easier for equity markets to the upside. Their charts look strong still on the longer timeframe. On the shorter timeframe both the QQQ and SPY have put in lower highs on the bounce, and this gives some pause. The IWM continues to wallow in broad consolidation on both timeframes. Use this information as you prepare for the coming week and trad’em well.

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