SPY Trends and Influencers July 6, 2024

Last week, the review of the macro market indicators saw with the 2nd Quarter of 2024 in the books and heading into the holiday shortened week, equity markets showed resilience with a rebound from a pullback and large caps and tech names holding at the highs. Elsewhere looked for Gold ($GLD) to continue in consolidation after the record move higher while Crude Oil ($USO) consolidated in a broad range. The US Dollar Index ($DXY) continued the short term move to the upside while US Treasuries ($TLT) continued in their secular downtrend. The Shanghai Composite ($ASHR) looked to continue the downtrend while Emerging Markets ($EEM) consolidated under long term resistance.

The Volatility Index ($VXX) looked to remain very low and stable 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 were showing signs of a possible reset on momentum measures as both were extended. The $IWM continued to lag in a long term channel.

The week played out with Gold pushing up out of the descending triangle while Crude Oil moved up out of consolidation. The US Dollar met resistance and pulled back while Treasuries found short term trend support and bounced. The Shanghai Composite had a weak bounce and fell back while Emerging Markets moved up towards the May high.

Volatility held near the lows of the year. This created a positive environment for equities and by Tuesday they started rising. This resulted in the SPY and QQQ printing 3 more all-time high closes to end the week. The IWM continued to move to its own drumbeat though and fell back Friday, all within the long consolidation range. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY came into the week in a digestive consolidation after making the top in mid-June. It continued Monday getting tighter to the 20 day SMA on the daily chart. Tuesday it moved higher, printing a new all-time high, and followed that up with new highs Wednesday and Friday. The Bollinger Bands® are opening higher now with the RSI strong and bullish and the MACD crossing back higher and positive.

The weekly chart shows the break higher from the short consolidation. The RSI is strong and bullish with the MACD positive and rising. The target from the Cup and Handle at 560 is above with the 161.8% extension of the retracement of the 2022 drop at 562 and the 200% extension at 613 above that. Support lower sits at 549.50 and 545.75 then 542 and 537 before 533 and 530. Uptrend.

SPY Weekly, $SPY

With the first week of July in the books, equity markets showed strength from the large cap and tech focused S&P 500 and Nasdaq 100, but continued churn from the small caps. Elsewhere look for Gold to continue its consolidation in the uptrend while Crude Oil consolidates in a tightening range. The US Dollar Index continues to drift to the downside in consolidation while US Treasuries move lower in their downtrend. The Shanghai Composite looks to continue the short term move lower while Emerging Markets remain in broad consolidation.

The Volatility Index looks to remain very low and stable making the path easier for equity markets to the upside. The charts of the SPY and QQQ look strong, especially on the longer timeframe. On the shorter timeframe both the QQQ and SPY have reset momentum measures and both are also looking strong upon reversing. The IWM continues to be dead money, going on 30 months now. 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 5, 2024

If you like what you see sign up for more ideas and deeper analysis using the Get Premium button above.   

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