If you’ve been hiding somewhere under a rock, you may have noticed the surge in stock market volatility at the end of January. Stock since almost aimlessly chopping back and forth, while the S&P 500 as represented in the spdr s&P 500 in real-time trust (NYSEARCA:spy) is now giving active investors and traders well-defined technical area on the charts to place side bets against long-term profit in the season.
During my so far twenty-year trading career, I found that one of the most important decisions in different time periods in the market is to add to the position or to take a step back. Equally important is the decision whether to play individual stocks or just look at the broad market and play with real-time or futures contract.
At this stage C below the technical installations and, as we head into the earnings season, in my eyes, it makes sense to see the games of the wider market for trade, and not to expose themselves to individual stocks.
Graphics spy in real-time
Click to enlarge
Moving averages legend: red – 200 a week, blue – 100 a week, yellow – 50 a week
On a multi-year weekly chart, we see that after a miss its trading range in January, the spy in real-time in the classical sense-returned to the channel and retest the lower support line. This lower support line around $250 currently also lines up with the yellow 50-day simple moving average, that is, the merge support that active investors and traders can play in the respect index on top for trade.
Two technical “things” of concern, however, are lower highs spy in real time in March and still-not-strong-enough indicator of the MACD oscillator at the bottom of the chart. Because of this, the challenge for me now is to play spy in real time on the rebound, but not in the hope that it reaches new and strong historical highs in the near future.
Click to enlarge
Moving averages legend: red – 200 day, blue – 100 day, yellow – 50 days
On the daily chart note that the 50-week moving average on the weekly chart also lines up with the red 200-day simple moving average as support. Spy in real time is still in the trade at multi-week sideways range with support around 255 $and resistance at about 267$. Considering that on the weekly chart above, the spy in real-time now bounces off the lower boundary of the channel, the trader can make a bet here to see the spy rally up in the mid-high $270 to finding other potentially more lower high.
Any meaningful reversal, and in extreme cases below $255 will be the stop loss.
Check out Anthony Mirhaydari at the Daily market on April 13.
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