SPY Trends and Influencers May 10, 2025

• Posted by Greg Harmon
• on May 10th, 2025

Last week, the review of the macro market indicators saw with April in the books and the FOMC meeting approaching, equity markets signaled that the bottom is in for this correction. Elsewhere looked for Gold ($GLD) to continue to digest its historic move higher while Crude Oil ($USO) resumed a new downtrend under support. The US Dollar Index ($DXY) remained in a short term downtrend, failing to continue a reversal, while US Treasuries ($TLT) consolidated the downtrend. The Shanghai Composite ($ASHR) looked to continue to consolidate in a tight range while Emerging Markets ($EEM) were poised for more upside in broad consolidation nearing resistance.

The Volatility Index ($VXX) looked to remain slightly elevated but moving lower making the path easier for equity markets to the upside. Their charts showed short term strength on both timeframes. On the shorter timeframe the $IWM, the $QQQ and the $SPY were breaking short term resistance on a shift to bullish momentum. On the longer timeframe the classic “V” recovery was showing up in all 3 Index ETFs.

The week played out with Gold making another push higher but stalling at a lower high and facing profit taking at the end of the week while Crude Oil found support at the April low and reversed. The US Dollar floundered in consolidation early before a slight move higher to end the week while Treasuries found support at the bottom of the consolidation range. The Shanghai Composite moved up out of a bull flag while Emerging Markets retested the March high but could not break through.

Volatility continued to move lower after a small uptick early. This, and the FOMC meeting Wednesday, held equities in a tight range early in the week, but they moved higher later as talk of trade deals and lower tariffs came out. This resulted in the SPY, the QQQ and the IWM moving back up to the recent highs. 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 5 week high and over the 50 day SMA for the first time since February 21st. It pulled back slightly Monday and Tuesday and then reversed Wednesday and Thursday and held Friday. A very narrow week at the 161.8% extension of the retracement of the 2022 drop, despite the FOMC decision. The RSI is holding just under the bullish zone with the MACD rising and positive territory as the Bollinger Bands® shift higher.

The weekly chart shows a doji candle for the week. The RSI is holding at the midline with the MACD negative but curling up for a cross. There is support lower at 556.50 and 549.50 then 545.75 and 542 before 540 and 537. Resistance above is at 565.50 and 571.50 then 574.50 and 581 before 585 and 590. Short Term Reversal Higher.

SPY Weekly, $SPY

With the May FOMC meeting in the books, equity markets showed resilience holding up in their short term rises. Elsewhere look for Gold to continue its consolidation in the uptrend while Crude Oil continues to trend lower. The US Dollar Index continues to drift to the upside in a bear flag while US Treasuries consolidate in their downtrend. The Shanghai Composite looks to continue in consolidation while Emerging Markets consolidate in a broad range just under resistance.

The Volatility Index 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. Use this information as you prepare for the coming week and trad’em well.

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