SPY Trends and Influencers May 17, 2025

• Posted by Greg Harmon
• on May 17th, 2025

Last week, the review of the macro market indicators saw With the May FOMC meeting in the books, equity markets showed resilience holding up in their short term rises. Elsewhere look for Gold ($GLD) to continue its consolidation in the uptrend while Crude Oil ($USO) continues to trend lower. The US Dollar Index ($DXY) continues to drift to the upside in a bear flag while US Treasuries ($TLT) consolidate in their downtrend. The Shanghai Composite ($ASHR) looks to continue in consolidation while Emerging Markets ($EEM) consolidate in a broad range just under resistance.

The Volatility Index ($VXX) looks to continue moving back to normal, making the path easier for equity markets to the upside. Their charts show short term strength on both timeframes. On the shorter timeframe the $IWM, the $QQQ and the $SPY are on the verge of breaking higher and a shift to bullish momentum. On the longer timeframe the classic “V” recovery continues to build in all 3 Index ETFs.

The week played out with Gold dropping back to a 1 month low in digestion while Crude Oil met resistance in a bounce in the downtrend. The US Dollar also met resistance and dropped back while Treasuries found support at a retest of the 2025 lows and bounced. The Shanghai Composite stalled at thee top on the consolidation range while Emerging Markets rose to 7 month highs.

Volatility continued to move lower on the week, back into the teens. This eased pressure off equities and they continued to rise. This resulted in the SPY and the QQQ ending less than 4% off their highs, but the IWM losing some momentum and stalling. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY came into the week at a 6 week high and the 161.8% extension of the retracement of the 2022 drop, despite the FOMC decision to continue waiting. It gapped up Monday over both the 100 and 200 day SMA’s, the latter for the first time since early March. It then continued higher all week to end at a 2½ month high. The RSI is deep in the bullish zone with the MACD rising and positive as price rides the Bollinger Bands® higher.

The weekly chart shows the doji candle from last week resolving to the upside and over the 20 week SMA. The RSI is rising off the midline with the MACD negative but crossing up. There is support lower at 593 and 590 then 585 and 581 before 574.50 and 571.50. Resistance above is at 600 and 604 then 609 and 610.25 before 613. Short Term Uptrend.

SPY Weekly, $SPY

With the May Options Expiration in the books, equity markets showed strength gapping up and then running higher. Elsewhere look for Gold to continue its digestion in the uptrend while Crude Oil continues to trend lower. The US Dollar Index continues a short term move to the upside while US Treasuries consolidate in their downtrend. The Shanghai Composite looks to continue in consolidation while Emerging Markets are on the cusp of breaking consolidate to the upside.

The Volatility Index looks to continue to drop and now is in the normal range, making the path easier for equity markets to the upside. Their charts show short term strength on both timeframes. On the shorter timeframe the IWM, the QQQ and the SPY are breaking higher with a shift to bullish momentum. On the longer timeframe the classic “V” recovery continues to build in all 3 Index ETFs as the SPY and QQQ close in on their all-time highs. Use this information as you prepare for the coming week and trad’em well.

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