Direction- the SPY is slowing down. It peaked and now has bearish tendencies.
Bollinger Bands- the ETF SPY has rested in this daily chart on the middle Bollinger band. In the last 2 weeks we have developed many gaps, and each gap has been filled. If we are going to continue in this direction up, we need to see the SPY move bullishly now and define the middle band as a support area. This will show strength if it can do this.
RSI- the SPY has gained much support lately from the RSI. We will be looking for a negative divergence in the RSI at some point to define a reversal coming up soon. But, as of yet, we do not have anything but bullish support.
MACD- as with the RSI, the MACD is supporting the bullish move of the SPY. The high peak that is now moving down will be very important. We are watching for one of two things. Either we will now start back up and continue to show strength, or we will see another peak that is not quite as high while the candlestick pattern continues to move up. This may create a negative divergence we will be looking for.
Chart- the SPY is forming a rising wedge pattern here. The rising wedge is a bearish pattern that begins wide at the bottom and contracts as prices move higher and the trading range narrows. In contrast to symmetrical triangles, which have no definitive slope and no bullish or bearish bias, rising wedges definitely slope up and have a bearish bias. Even though this article will focus on the rising wedge as a reversal pattern, the pattern can also fit into the continuation category. As a continuation pattern, the rising wedge will still slope up, but the slope will be against the prevailing downtrend. As a reversal pattern, the rising wedge will slope up and with the prevailing trend. Regardless of the type (reversal or continuation), rising wedges are bearish. So we are waiting for the RSI & MACD to give us a negative divergence to confirm and support this possible reversal