The SPY is Falling Again With More Landmines for the S&P 500 (SPX).
The S&P 500 ETF or SPY was higher on Thursday, despite all of the land mines in the news. The index closed half a percent away from the all-time highs, confirming the strength of the U.S. economy.
Are the markets topping?
The financial media remains steadfast in its commitment to scare the hell out of their audience. Trade worries, dollar strength, commodity weakness, fills the day. The past few months have been unbearable. Still. corporate sales, earnings and guidance have helped buoy the markets.
S&P 500 earnings results have been better than expected.
More than 85% of S&P 500 companies have released their second-quarter results. The majority or nearly 77% reported better-than-expected quarterly profits. Source: FactSet.com.
Technically speaking, SPY is trading near the rising (bullish) 9ema in early trading. RSI has been in the upper half of the indicator all during the rally from May onward. Keep this in mind going forward as major support, VBP and blocks are just below at 281.00 (+/-).
TICK cumulative in the lower panel is still bullish. MACD remains above its signal line. Volume is below average, during the seasonally weakest month of the year.
All things considered, SPY is lower (-0.47%) in pre-market trading.
Starting the Friday session, many investors are watching the S&P500 for a break above 2,872.87 on above average volume, where the index would notch a new record high. Others are focused on the January 26 high as a double top, which will lead to lower levels.
SPY – Additional Considerations.
The VIX fear indicator or volatility index popped 3.78% and remains elevated this morning. A bit more fear is needed before we can assume a short-term bottom is ready to be bought.
To reiterate, earnings and the steady U.S. economic expansion (4.1% GDP, remain our focus.
Happy Trading,
Vinny
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