SPY Trends and Influencers April 20, 2024

Last week, the review of the macro market indicators saw heading into the April options expiration, equity markets showed some cracks in the uptrends. Elsewhere looked for Gold ($GLD) to continue its uptrend, but with perhaps a short term pause while Crude Oil ($USO) consolidated the move higher. The US Dollar Index ($DXY) looked to break to the upside while US Treasuries ($TLT) resumed their downtrend. The Shanghai Composite (ASHR) looked to consolidate in its move higher while Emerging Markets ($EEM) consolidated in a broad channel.

The Volatility Index ($VXX) looked to continue to slowly move higher keeping pressure on equity markets. The $QQQ looked the strongest, especially on the longer timeframe as it consolidates while the $SPY digested its strong move with a pullback. The $IWM seemed to have given up any chance of breaking out of the long consolidation as it fell back into the channel.

The week played out with Gold pushing up to 2400 per ounce and consolidating while Crude Oil moved lower out of consolidation. The US Dollar paused in its move higher while Treasuries printed new 5 month lows. The Shanghai Composite continued to consolidate around its moving average at resistance while Emerging Markets fell to fresh 2 month lows.

Volatility continued to rise in a slow fashion, reaching the October highs. This continued the pressure on equities and they moved lower all week. This resulted in the SPY, IWM and QQQ ending at 2 month lows and continuing to look weak. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY came into the week sitting on the 50 day SMA on the daily chart after a slow rolling pullback from a top at the end of March. It dropped down through that 50 day SMA Monday and continued lower the rest of the week. It closed Friday just above the 100 day SMA after a 6 day losing streak. This was the first time it had dropped 6 days in a row since marking the October 2022 market bottom, the last time. It is approaching a 38.2% retracement of the leg higher since October 2023. The RSI is falling in the bearish zone and about to push into oversold territory with the MACD negative and dropping.

The weekly chart show nearly a bearish Marubozu candle, suggesting more downside, ending at the 20 week SMA. The RSI is falling toward the midline in the bullish zone with the MACD crossed down and dropping. There is support lower at 495 then 491.50 and 488 then 478 and 473.50 before 470 and 466. Resistance higher is at 498.50 then 501.50 and 503.50 before 510 and 513.50. Pullback in Uptrend.

SPY Weekly, $SPY

With the April options expiry in the books, equity markets have finished the week black and blue after taking a beating. Elsewhere look for Gold to continue its consolidation at all-time highs in the uptrend while Crude Oil pulls back in its uptrend. The US Dollar Index continues to drift to the upside while US Treasuries pullback in their downtrend. The Shanghai Composite looks to continue the consolidation in its short term uptrend while Emerging Markets drop in broad consolidation.

The Volatility Index looks to remain low but rising keeping the pressure on equity markets. Their charts look weak, especially on the shorter timeframe. On the longer timeframe both the QQQ and SPY remain above break out levels from the start of the year, not a problem yet. The IWM has fallen back into its long channel consolidation though, a failed break out. These often lead to fast moves lower. 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 April 19, 2024

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
Dragonfly Caps Blog