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Chart courtesy of StockCharts.com
- $SPY sits at +3.04% year to date. It hasn’t delivered much return in 2016 for all the risk that has been taken on during the drawdowns.
- $SPY continues to stay inside a large trading range since late 2014.
- All-time highs were rejected last week.
- The Brexit possibilities are starting to send jitters into the equity markets, giving bulls an excuse to lock in profits.
- $SPY gapped down Friday and never closed the gap. This is a downside signal short term.
- $SPY lost the 10-day EMA Friday, showing a reversal in the short term time frame.
- MACD is still bullish but it is starting to turn over.
- Slow Stochastic is under a bearish cross in the short term time frame.
- 55 RSI is still bullish.
- Long term is still bullish, and likely that we break out to new all-time highs in coming weeks. However, the odds are on a pullback in the indexes to work off the overbought conditions. A 50 RSI and 50-day SMA convergence would be the first possible dip buy level for my system.