SPY Trends and Influencers May 6, 2023

• Posted by Greg Harmon
• on May 6th, 2023

Last week, the review of the macro market indicators saw with the month of April in the books, equity markets showed resilience with a rebound from an ugly start to the week to finish stronger. Elsewhere looked for Gold ($GLD) to consolidate in its uptrend while Crude Oil ($USO) consolidated in a broad range. The US Dollar Index ($DXY) continued to drift to the downside while US Treasuries ($TLT) consolidated in their downtrend.

The Shanghai Composite ($ASHR) looked to continue in consolidation along with Emerging Markets ($EEM). The Volatility Index ($VXX) looked to remain very low and stable making the path easier for equity markets to the upside. Their charts were mixed with the $SPY following the $QQQ higher but with both looking strong on both timeframes. The $IWM however remained stuck in consolidation under resistance.

The week played out with Gold running higher to retest the all-time high and then dropping back while Crude Oil fell to the bottom of the consolidation range. The US Dollar moved sideways at support while Treasuries continued to consolidate in a narrow range. The Shanghai Composite moved up to the top of the consolidation zone while Emerging Markets held in place.

Volatility rose up off of 52 week lows but met resistance and fell back at the end of the week to end slightly higher. This put initial pressure on equities and they responded by with a 3 day move lower to bottom Thursday. All reversed Friday to finish the week. That left the SPY and IWM slightly lower on the week with the QQQ positive. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY came into the week approaching a retest of the February high. It pushed up Monday but could not hold and followed with a 3 day pullback to the April low. Friday saw a gap higher and buying all day drive price back above the 20 day SMA on the daily chart. It ended slightly lower on the week while absorbing more banking crisis and a hawkish possible pause from the Fed following the Wednesday rate hike. The RSI on the daily chart is rising again in the bullish zone with the MACD slowly drifting lower, but positive.

The weekly chart shows a slight trend of the real bodies to the upside and remaining above the end of January high. The RSI on this timeframe is flat over the midline but short of the bullish zone. The MACD is rising and positive though. There is resistance at 413.50 and 417.50 then 420 and 423 before 425.50 and 428.50. Support lower comes at 411 and 407.50 then 405.50 and 402.50 before 400.50. Consolidation.

SPY Weekly, $SPY

With the May FOMC meeting in the books, equity markets showed resilience with a rebound Friday erasing an ugly midweek slump. Elsewhere look for Gold to continue its uptrend while Crude Oil holds in the low end of a consolidation range. The US Dollar Index continues to drift sideways at support while US Treasuries consolidate in their downtrend. The Shanghai Composite looks to continue higher in consolidation while Emerging Markets consolidate.

The Volatility Index looks to remain very low and stable making the path easier for equity markets to the upside. The charts of the QQQ and SPY look strong on the longer timeframe with the IWM in consolidation. On the shorter timeframe both the IWM and SPY look to try to break consolidation while the QQQ heads higher. 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 May 5, 2023

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