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John Mylant
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Residing in Colorado Springs, Colorado. Has been trading and coaching using a self-developed option trading system for 10 years. Philosophically conservative, accurately trades weekly options with a strong risk management approach. Well sought after by investors around the world, he teaches a... More
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SPY Technical Analysis
  • ETF SPY: Watch Earnings Season For Influence 0 comments
    Mar 31, 2013 8:14 AM | about stocks: SPY

    Technically Speaking (NYSEARCA:SPY)

    RSI- even though even though I believe a slow down is coming soon in the markets, the RSI indicator continues to remain well above the 50 line and in bullish territory and appears like it's going to continue to move up. It looks like the stock has finished moving sideways off the outer Bollinger band and will now journey up again like it has been doing.

    MACD-the MACD continues its sideways journey far above its zero line with no well-defined high point or top that I look for to move down when I think a trend change is coming. Back in the end of January I see the stock high point but it hasn't moved down that far everything is still very bullish.

    Bollinger Bands-after moving sideways off the outer Bollinger bands I was waiting to see what the stock would do. As it touched the middle band and it started to move up again which shows me that it hasn't lost any strength. If I believe a slowdown is coming there were no signs given this week that it will be happening soon.

    Conclusions- because of the season coming up I'm still aware of weakness to could occur in the stocks move up. But at this point I see no signs in the charts that it is ready to give up its journey. So far it is still very bullish and doesn't look like it's ready to stop.

    Current Events

    After flirting with an all-time high for three weeks, the S&P 500 (SPX) posted its best closing level in history. But some strategists say Thursday's record could be a harbinger that the stock market rally is running out of steam.

    The increase in volatility we've seen is far more likely to be the sign of a short-term top" than the trend of investors buying on dips. If that volatility persists, then you would need to worry about an intermediate top.

    Speculator positions show a preference for holding long positions. Mike O'Rourke, chief market strategist at Jones Trading, noted that long positions account for more than 65 percent of speculative positions in futures contracts, a point at which rallies can be overextended.

    Cyprus will remain in focus after the government was forced to accept a stringent European Union rescue package to avert default. In a positive sign, there were no runs by depositors on banks after they reopened under tight controls on Thursday.

    Presently, the economy continues in the slow growth stage but the looming threat of a slowdown is ever present before us. With the low expectations corporate profits also continue to improve this is going to be a big factor in this first quarter to see how they perform.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Stocks: SPY
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