SPY Battles Broken Support and Key Retracement

The bulls simply refuse to give up. SPY opened lower with a gap below 129, but the bulls quickly entered the market and pushed stocks higher. SPY surged back to Monday's high, DIA exceeded Monday's high and tech stocks showed relative strength on Wednesday. With yesterday's recovery bounce, SPY established a reaction low upon which to based short-term support. The indicator window shows RSI hitting resistance at 65 this week. A break above this level would turn momentum bullish for the first time since February 18th.

110324spyi

110324spyd




Key Economic Reports/Events:

Thu - Mar 24 - 08:30 - Initial Claims
Thu - Mar 24 - 08:30 - Durable Orders
Fri - Mar 25 - 08:30 - GDP Estimate
Fri - Mar 25 - 09:55 - Michigan Sentiment

Charts of Interest: Tuesday and Thursday in separate post.

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This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it comes to trading our own accounts. First, it is the only way to really learn. Second, we are the only ones responsible for our decisions. Think of these charts as food for further analysis. Before making a trade, it is important to have a plan. Plan the trade and trade the plan. Among other things, this includes setting a trigger level, a target area and a stop-loss level. It is also important to plan for three possible price movements: advance, decline or sideways. Have a plan for all three scenarios BEFORE making the trade. Consider possible holding times. And finally, look at overall market conditions and sector/industry performance.

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