SPY Trends and Influencers September 7, 2024

• Posted by Greg Harmon
• on September 7th, 2024

Last week, the review of the macro market indicators saw heading into the unofficial end of summer and with August in the books, that equity markets showed a preference for some rest after the 3 week move higher. Elsewhere looked for Gold ($GLD) to continue its uptrend while Crude Oil ($USO) consolidated in a tightening range. The US Dollar Index ($DXY) continued to bounce to the upside while US Treasuries ($TLT) consolidated in their downtrend. The Shanghai Composite ($ASHR) looked to continue the downtrend while Emerging Markets ($EEM) consolidated over support in a possible start of a new uptrend.

The Volatility Index ($VXX) looked to remain 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 the week long consolidation left the $SPY with only 2 hours to rocket to just shy of a new all-time high close while the $QQQ and the $IWM ended near the high of the week. All were prepped to start September stronger.

The week played out with Gold holding at the highs in consolidation while Crude Oil broke down to a nearly 10 month low. The US Dollar fell back from its quick bounce while Treasuries rose to test the December 2023 high. The Shanghai Composite fell to a 7 month low while Emerging Markets broke support to hit a 1 month low.

Volatility rose Monday out of the teens and held the rest of the week. This put pressure on equities and they responded by moving lower all week and closing the mid-August gaps. This resulted in the SPY, the QQQ and the IWM confirming lower highs as recession fear overtook the market. What does this mean for the coming week? Let’s look at some charts.

SPY Daily, $SPY

The SPY came into the week holding in consolidation just under the all-time high. It dropped Tuesday touching the 50 day SMA and held there through Thursday before a second big fall Friday closed the mid-August gap down. It closed at the lowest level since August 13th. The RSI is falling below the midline after making a lower high with the MACD crossed down but positive. The Bollinger Bands® are squeezing in with price now closing in on the 100 day SMA.

The weekly chart shows the confirmation of a reversal with a strong move lower following the doji. It ended at the 20 week SMA. There is also a momentum divergence with the RSI making a lower high as price made a higher high. The RSI remains bullish over the midline with the MACD positive but moving lower. There is support lower at 540 and 537 then 534 and 530 before 524.50 and 520.50. Resistance higher is at 542 and 545.75 then 549.50 and 556.50 before 561.50 and 565.50. Broad Consolidation with Possible Change of Character.

SPY Weekly, $SPY

With the first week of September in the books, equity markets reverted to weakness, trending lower all week. Elsewhere look for Gold to continue its uptrend while Crude Oil continues to move lower. The US Dollar Index continues in broad consolidation while US Treasuries show signs of a possible new uptrend. The Shanghai Composite looks to continue the downtrend while Emerging Markets drop back into a short term downtrend.

The Volatility Index looks to shift from low and stable to low and rising making the path more difficult for equity markets. Their charts look weak om the shorter time frame as price pulls back from a lower high, but they remain above making a lower low for now. On the longer timeframe they look stronger, but vulnerable with the SPY strongest then the IWM and the QQQ the weakest. 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 September 6, 2024

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