A few people have been mentioning SPY so I decided to do a SPY chart. If you want to study the S&P500 index over a long period of time then looking at a SPY chart is a good way to do it. Notice that the 137.18 downtrend line correctly predicts the short-term top made in [...]

A couple important things happened today. First SPY dropped just low enough to fill the gap at 126.21. Second SPY bounced strongly off of trendline A. I don’t think Greece news was the real reason for the end of day rally. If the Bulls lost support from trendline A it could invite even more selling [...]

SPY is set to gap up and open at 134.1. SPY is close to filling the gap from February at 134.53. The large gap up from 131.31 three days ago is worrisome. It’s hard for me to imagine a scenario where SPY makes new highs for the year and runs away towards 138-144 without filling [...]

SPY gapped down yesterday and was unable to fill the gap. Today SPY is set to open around 132.2, close to Monday’s close at 132.46. The gap is acting as resistance. Why? Because an open very close to or above 132.46 could trigger an island reversal- a very powerful reversal signal. For this signal to [...]

SPY has convincingly rallied above 122.98 (the 61.8% retracement level of the drop from 157.52 to 67.1). This is significant because it SEVERELY DECREASES the probability that the rally from the March 2009 lows is just a corrective wave and that a larger wave (illustrated with the orange arrow) will take place in the future.

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Happy New Year! SPY Is set to gap up and open at ~126.7. I’m about 70% confident that today the breadth will be steeply in favor of the bulls and that the stock market will simply rise today. There is some news on construction at 10AM, that’s the only real obstacle that could shut [...]

Existing home prices continue to drop as reported by the S&P/CS report this morning. With 10% unemployment and lackluster home sales, I have a hard time believing the economy will bounce back. Nevertheless, SPY is set to gap up and open at 125.9. This is a small gap up and I expect it to be closed today. Lately [...]

Right around the end of the day yesterdayI tweeted that a short setup was setting up.To be honest, I was doubting my own analysis because of the strength of theup move. But once the market closed, SPY dropped in the 15 minutes of after hours trading and so I left my short open.Now SPY is set to [...]

Here is a long setup on SPY. Early in the day breadth was overly bearish at ~10:1 in favor of bears. We got two -1200 tick signals around117.8, a known support level without much follow through. Subsequently breadth has improved from 10:1 to only 3:1 in favor of bears. Furthermore the drop from SPY 120.23 to 117.74 [...]