SPY Trends and Influencers April 13, 2019

Last week’s review of the macro market indicators saw that as the 2nd Quarter started there was no sell off in equities, rather they gapped higher on the week showing strength. Elsewhere looked for Gold ($GLD) to continue to consolidate while Crude Oil ($USO) remained in an uptrend. The US Dollar Index ($DXY) looked to mark time next week while US Treasuries ($TLT) pulled back in their uptrend.

The Shanghai Composite ($ASHR) and Emerging Markets ($EEM) ere back in their uptrends.  Volatility ($VXXB) was very low and looked to continue there, keeping the bias higher for the equity index ETF’s $SPY, $IWM and $QQQ. Their charts showed the SPY and QQQ now looking like strong uptrends with the IWM turning up to join them.

The week played out with Gold moving higher early but then giving it all back late in the week while Crude Oil moved up Monday and then consolidated. The US Dollar drifted slightly lower while Treasuries consolidated and then gave up some gains Friday. The Shanghai Composite peaked Tuesday and then saw profit taking while Emerging Markets consolidated at the higher high.

Volatility held in a tight range with a small bounce early faded late in the week, keeping the bias higher for equities. The Equity Index ETF’s held their ground early and then started higher mid-week. They ended with the SPY and QQQ pressing to new 6 month highs, while the IWM remains in a consolidation range but approaching the top. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY entered the week moving higher and less than 2% from its all-time high. It started higher and then gave a little back Tuesday. The rest of the week it inched higher but could not manage to reach that all-time high. It ended the week with a move to new 6 month highs and just over 1% from the October top.

The daily chart shows the slow grind higher along the upper Bollinger Band®. The RSI is running along the edge of overbought territory, strongly bullish. The MACD is fairly flat refusing to turn overbought. A grind to the all-time high seems only a matter of time.

The weekly chart shows a two week move higher out of consolidation. The Bollinger Bands have opened to allow a further move. The RSI is rising and bullish with the MACD rising and positive. There is resistance above at 292 and 294. Support lower sits at 289.50 and 287 then 285 and 284 before 282 and 280. Uptrend.

SPY Weekly, $SPY

Heading into the shortened pre-Easter week the equity markets continue to grind higher but remain short of their all-time highs. Elsewhere look for Gold to consolidate in a tightening triangle while Crude Oil advances higher. The US Dollar Index continues to consolidate sideways while US Treasuries pull back retesting their break out. The Shanghai Composite looks to pause in its uptrend while Emerging Markets are biased to head higher.

Volatility looks to remain at very low levels keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. The SPY and QQQ seem ready to retest their all-time highs while the IWM has gotten caught up at resistance and continues to churn sideways. Use this information as you prepare for the coming week and trad’em well.

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