Author: OptimizedValue

SPY, the SPDR S&P 500 ETF had the weakest week of the major four indexes, gaining only +1.11%, while the VIX finished the week at 16.15, indicating a one day implied move of +/-1.02% & an implied one month move of +/-4.67% for the S&P 500.

Their RSI is currently at 63.7 & has curled over bearishly after Friday’s session which will be something to keep an eye on moving into this week.

SPY’s MACD is still bullish following Thursday’s gap up session, however it should be noted that Thursday’s gains were only due to the gap up & their closing price was lower than their opening price.

Volumes were still weak, finishing the week -12.16% below the past year’s average (59,568,000 vs. 67,816,126), which is problematic given that two of the week’s three highest volume sessions were declining sessions.

The week began on a note of uncertainty, as Monday’s session was a tight range advance on the week’s lowest volume that barely closed above the previous Friday’s close.

Tuesday continued this theme, as despite a gap up on the open, the day closed lower, although still higher than Monday’s close & the candle’s lower shadow shows that there was a bit of appetite to the downside compared to the upside.

Wednesday is when weakness began to show itself as the session tested higher than Tuesday’s high before ultimately giving everything back & resulting in a decline on higher volume than the previous two days as market participants were eager to take some chips off of the table.

Thursday gapped higher on the second highest volume of the week, but resulted in a long-legged doji indicating uncertainty among market participants.

It should be noted that the session closed lower than it opened on Thursday, which indicates that the day’s open was deemed to be too high by investors.

Friday solidified this sentiment, as the day opened on a gap lower on the highest volume of the week as folks were eager to remove risk before heading into the weekend.

Friday tested more to the downside than upside based on the length of the day’s candle’s lower & upper shadows but the session only closed down -0.17%.

Heading into this week there are still a handful of earnings calls including Costco, as well as a plethora of economic data & Fed speakers which should make for an interesting week.

All eyes will be on the $562.48-563.43 support zone this week, as a ~1% downside move will test these support levels that have developed over the past two months when prices reached new peaks & began declining.

As noted in last week’s market review note, this will occur in the event of a throwback following a false breakout.

Prices have broken out but not progressed much higher & have declined since setting the new all-time high.

This looks possible given the lack of strength behind the mid-to-end of week performance of SPY last week.

Watch the MACD histogram for clues into this, as if the bars begin to get lower day-over-day it will signal that there is not much steam left & that there is an impending decline.

In the event that this happens, it will be interesting to see where support is found, as while the $560-565 price zone is 10:1 Buyers:Sellers historically, it is still relatively untested, given that it is home to the recent resistance level that was not broken through until Thursday of last week.

There is -1.77% difference between the current price of SPY & their 10 day moving average, with an additional -1.66% difference between the 10 & 50 DMAs for support, which if the support zone mentioned above breaks down will likely see a test given that the $555-559.99 price window is seller dominated 1.25:1.

Based on the weakness/uncertainty of the past two sessions it is uncertain as to how much higher SPY can climb in the event of positive news, as market participants look to be on edge at these current price levels & after the past few months.

SPY has support at the $563.43 (Volume Sentiment: Buyers, 10:1), $562.48 (Volume Sentiment: Buyers, 10:1), $558.19 (10 Day Moving Average, Volume Sentiment: Sellers, 1.25:1) & $553.17/share (Volume Sentiment: Buyers, 1.92:1) price levels, with resistance at the $571.13/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 added +1.49% last week in a week that looked similar to SPY’s.

Their RSI is currently at 59.71 & is also curling over bearishly after Friday’s session, while their MACD is still bullish.

Volumes were very weak for QQQ, coming in -16.08% below the previous year’s average (35,988,000 vs. 42,884,111), which as has been noted in previous weeks’ posts is particularly low given that volumes as a whole have been lower than average compared to years prior since April 2024.

The support of the 50 day moving average held up for QQQ on Monday, as the session tested down towards it but was able to close as a dragonfly doji, indicating uncertainty among market participants, but the open & close were concentrated near the top of the day’s range on the lowest volume of the week.

Tuesday this theme continued, as the day opened on a gap up but ultimately closed lower than it opened on the second lowest volume of the week.

Tuesday’s lower shadow indicated that there was some downside appetite, but the bulls were able to push through & it did not go as low as Monday’s lower shadow.

Wednesday opened about midway through Tuesday’s candle’s real body & tested higher before ultimately nosediving to close near the bottom of Tuesday’s lower shadow, but still well above the support of the 50 DMA.

Much like SPY, QQQ enjoyed a gap up open on Thursday, except QQQ’s was on the week’s highest volume.

While the day’s high was able to break above the resistance level of $485.54, there is a lot of uncertainty & doubt in the air as the session ended as a spinning top candle that closed lower than it opened, indicating that there was some bearish sentiment brewing.

Friday this theme continued, as the day opened lower & wound up resulting in a doji candle, indicating uncertainty & risk-off sentiment heading into the weekend.

Something to keep an eye on this week is the 10 & 50 day moving averages which recently just had a bullish crossover, as last month when this happened it only lasted briefly & preceded a decline.

While that is not necessarily going to happen again, the uneasiness of market participants that QQQ’s candles are showing makes it a possibility that shouldn’t be ignored, particularly when you look at their RSI now vs. back in August at the time.

In the event that QQQ declines to begin filling in the window created by Thursday’s gap up session the next two price levels have been dominated by Sellers (1.05:1 & 1.08:1) which makes it likely that the next two support levels will not be able to hold up QQQ’s price, leading to a test of the support of the 50 day moving average.

Should that support level not hold up there isn’t another for another -1.83% at the $459.85, which also happens to be in a seller dominated price zone (1.63:1).

The upside price levels of $485.54 & $486.23 should be watched for in the event of an advance as they will be the nearest resistance levels for QQQ.

QQQ has support at the $475.55 (Volume Sentiment: Sellers, 1.08:1), $471.43 (10 Day Moving Average, Volume Sentiment: Buyers, 1.58:1), $468.44 (50 Day Moving Average, Volume Sentiment: Buyers, 1.58:1) & $459.85/share (Volume Sentiment: Sellers, 1.63:1) price levels, with resistance at the $485.54 (Volume Sentiment: Buyers, 1.6:0*), $486.23 (Volume Sentiment: Buyers, 1.6:0*) & $503.52/share (All-Time High, Volume Sentiment: Buyers, 0.6:0*) price levels.

IWM, the iShares Russell 2000 ETF had the strongest week of the major four index ETFs, advancing +2.19% for the week.

Their RSI is at 63.7 & has flattened out after Friday’s session, while their MACD is still bullish.

However, much like SPY, IWM’s Thursday session’s gap up contributed greatly to their MACD’s continued bullishness, but the session closed lower than it opened on that day, indicating bearishness & uncertainty/a lack of confidence given it resulted in a doji candle.

Volumes were +3.17% above the previous year’s average (36,580,000 vs. 35,454,783), bucking the continued below average volume trend of SPY, QQQ & DIA.

IWM’s week looks a lot different than that of SPY & QQQ, but still is riddled with uncertainty.

Monday kicked the week off with a gap up session that resulted in a doji candle on the week’s lowest volume, indicating that there was a great deal of uncertainty in the market.

Tuesday this theme continued, as IWM gapped up again, only to close as a doji, but this time closer to the lower end of the day’s range (but not as a gravestone doji).

Wednesday saw the highest volumes of the week, as well as the highest price level of the week, but the session closed as a doji near in line with Tuesday’s candle’s real body.

While IWM was able to test much higher based on the day’s upper shadow, the bulls were unable to hang on & or all bailed to take profits during the day forcing the close to be on the low end of the day’s candle.

Thursday managed to open higher near the high end of Wednesday’s upper shadow, but ultimately saw a lot of selling action that forced the day’s low end of the range to test almost halfway down the upper shadow of Wednesday’s candle before settling as a hanging man candle that closed lower than it opened.

Friday confirmed this bearish sentiment as the session opened on a gap down & continued lower throughout the day on volume that was average for the week, echoing the risk-off sentiment of SPY & QQQ & closing below the support level of $222.45.

Friday’s close sets IWM up to enter a Seller dominated price zone if they decline down to the $219.99 price level, where until $216 the Sellers have been the dominant force at a rate of 3.3:1.

This is important to note as the next support level is currently the 10 day moving average, which happens to be below $216 & sits just atop the 50 DMA’s support after recently crossing it bullishly.

Like noted above, watching the angle that those moving averages move at in the coming week(s) will lend clues to where price direction is headed, but the current sentiment remains cautious.

As has been noted in previous months’ posts, the consolidation ranges that IWM has spent much of December 2023 until July of 2024 in contain multiple support zones, but given that their 200 day moving average has advanced as high as it has to the midway point of this range it will be interesting to see what happens in the event of a decline.

Should we see a significant decline that breaks down through the 200 DMA it will undermine the strength of sentiment at the other local support levels, which could see the $190.81/share support level

IWM has support at the $215.62 (10 Day Moving Average, Volume Sentiment: Buyers, 1.69:1), $215.04 (50 Day Moving Average, Volume Sentiment: Buyers, 1.69:1), $211.29 (Volume Sentiment: Buyers, 2:1) & $209.29/share (Volume Sentiment: Buyers 2:1) price levels, with resistance at the $222.45 (Volume Sentiment: Buyers, 2.86:1), $224.94 (Volume Sentiment: Buyers, 1.6:0*) & $228.63/share (52-Week High, Volume Sentiment: NULL, 0:0*) price levels.

DIA, the SPDR Dow Jones Industrial Average ETF climbed +1.36% for the week, mostly on account of Thursday’s gap up session.

Their RSI is approaching overbought levels & has flattened out at 67.87, while their MACD continues on bullishly.

DIA’s MACD continuing higher can be attributed to Thursday’s gap up session, but like SPY & IWM they closed Thursday’s session lower than where it opened on a spinning top candle, indicating uncertainty with a touch of bearishness.

Volumes were -7.22% below the previous year’s average (3,316,000 vs. 3,574,071), which is not s sign of strength given that three of their five sessions last week resulted in advances.

Monday kicked DIA’s week off on an uncertain note, as the day resulted in a spinning top & set up the next two day’s consolidation range.

Tuesday the uncertainty continued, as a low volume declining session also resulted in a spinning top as investors awaited the FOMC announcement on Wednesday afternoon.

Wednesday set up the end of the week’s new all-time high as prices rallied during the day, but ultimately closed lower for the day as investors were eager to take profits off of the table.

Thursday opened to a gap up, but the uncertainty & uneasiness theme remained in play as the session closed lower than it opened & closed as a hanging man candle, which is a sign of bearishness.

Thursday saw the highest volumes of the week as well, which was likely due to profit taking by folks who benefitted from the gap up to the all-time high.

Friday the uncertainty continued, when an average volume session resulted in an advance of +0.1% & closed in a spinning top candle heading into the weekend.

DIA has the most Buyer dominated support levels of the four major index ETFs primarily due to the slow ascent it has taken in the wake of the rapid climb it took in Q4 2023.

This has also benefitted it by creating more support levels along the way than the other index ETFs enjoy, which makes sense as investors have run to blue chip names in recent history.

With that said, there has not been much downside testing against the more recent price levels, as can be seen in the table below where the denominator (Sellers) is 0 for the first few price levels.

With this in mind, it would be wise to be cautious in the event of a decline for DIA, as there has been limited downside testing above $403.99/share.

While this does not mean that shares will necessarily tank between the current price & $400/share, it is entirely possible that market participants who got in above this level will leave in droves to protect their profits (~5% from $400).

It would also be wise to be cautious if in the coming days a new all-time high is hit but volumes are weak, as that would set up a prime time for a price reversal, especially with DIA’s RSI nearing the overbought level.

DIA has support at the $415.32 (Volume Sentiment: Buyers, 0.8:0*), $413.53 (10 Day Moving Average, Volume Sentiment: Buyers, 0.8:0*), $412.11 (Volume Sentiment: Buyers, 0.8:0*) & $412.11/share (Volume Sentiment: Buyers, 0.8:0*) price levels, with resistance at the $421.53/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Monday the week kicks off with Atlanta Fed President Bostic speaking at 8 am, S&P Flash U.S. Services PMI & S&P Flash U.S. Manufacturing PMI data at 9:45 am, Chicago Fed President Gooslbee speaking at 10:15 am& Minneapolis Fed President Kashkari speaking at 1pm.

AAR Corp reports earnings after Monday’s closing bell.

Fed Reserve Governor Bowman speaks at 9 am Tuesday, with the S&P Case-Schiller Home Price Index data coming out at 9 as well, followed by Consumer Confidence data at 10 am.

Tuesday morning’s earnings reports include AutoZone & Thor Industries, with KB Home, Progress Software, Stitch Fix & Worthington Enterprises scheduled to report after the session’s close.

Wednesday brings us New Home Sales data at 10 am & at 4pm Fed Governor Kugler speaks.

Cintas reports earnings Wednesday morning before the opening bell, followed by Micron Technology, Concentrix, H.B. Fuller, Jefferies & Worthington Steel after the session’s close.

Initial Jobless Claims, Durable-Goods Orders, Durable-Goods minus Transportation & GDP (second revision) data come out Thursday morning at 8:30 am, followed by Fed Governor Kugler & Boston Fed President Collins speaking together at 9:10 am, Fed Governor Bowman speaking at 9:15 am, Fed Chair Powell delivering opening remarks at 9:20 am & Fed President Williams speaking at 9:25 am.

In a busy morning Pending Home Sales data is released Thursday at 10 am, Fed Vice Chair for Supervision Barr speaks at 10:30 am, as does Fed Governor Cook & at 1pm Fed President Kashkari & Chair for Supervision Barr speak together at 1 pm.

Accenture, CarMax, Jabil & TD Synnex are all schedule to report earnings on Thursday morning before the session opens, with Costco Wholesale, BlackBerry & Vail Resorts due to report earnings after the closing bell.

Friday brings another busy day on the data front, with Personal Income, Personal Spending, PCE Index, PCE Year-over-year, Core PCE Index, Core PCE Year-over-Year, Advanced U.S. Trade Balance in Goods, Advanced Wholesale Inventories & Advanced Retail Inventories data due out at 8:30 am, followed by Consumer Sentiment (final) at 10 am & Fed Governor Bowman speaking at 1:15 pm.

There are no major earnings reports due out on Friday.

See you back here next week!

*** I DO NOT OWN SHARES OR OPTIONS CONTRACT POSITIONS IN SPY, QQQ, IWM OR DIA AT THE TIME OF PUBLISHING THIS ARTICLE ***

What a week it’s been; a 50 bps cut from the FOMC, fresh all-time highs for the S&P 500 & Dow Jones Industrial Average & the usual gloomy month of September has been ok for stocks thus far, although the VIX sits at 16.8, indicating an implied one day move of +/-1.06% & an implied one month move of +/-4.86%.

Many of the same elements of political uncertainty in the U.S. & abroad remain or have escalated since our last index ETF price level:volume sentiment check in from July & as a result volatility looks to remain elevated in the coming months.

This makes it a prime time to check in on historic Buyer:Seller (or Seller:Buyer) sentiment at the price levels that each index ETF has traded at over the past few years in order to assess the strength of each’s support & resistance levels.

Due to the aforementioned new high price levels that each index ETF has been experiencing & the subdued volumes that we have seen since April many of the higher range price levels are still “NULL”, meaning that they are not 0, but there is not enough data currently to work with in terms of assigning buyer:seller (Seller:Buyer) strength ratios.

Additionally, you will notice as you go through the numbers that the higher prices tend to skew more towards the buyers, as there have been limited downside tests against these price levels, and the low volumes have not helped this.

Similarly, you will notice that there tend to be more sellers towards the lower ends of the price ranges.

Upon retests of a price level these numbers will become evened out more, but in the meantime the strength (weakness) of each level’s ratio can be used like a barometer to assess how strongly buyers & sellers have historically felt at each & how that may impact their decisions in the future.

Each section below contains a view of each index ETF’s chart (for a technical breakdown of each ETF’s chart please see this past weekend’s market review note), as well as a list of their current one year support & resistance levels with the volume sentiment noted beneath it on the table.

There is an additional table beneath this table with each price level’s sentiment, as well as a typed text version below that is able to be copied & pasted.

Note that “NULL, 0:0*” values denote areas that each name has traded at but with limited volume data to work with from a comparison standpoint in terms of creating a ratio of buyers:sellers (or vice versa).

Also, prices that do have a ratio of Buyers:Sellers (Sellers:Buyers) where the denominator is 0 are denoted with an asterisk “*” as well.

In the written lists of the price levels & volume sentiments the price levels that contain support & resistance levels are marked in BOLD.

Recall that at price extremes such as the highs that we have recently hit there will tend to be skewed data due to the small sample size & factor that into how you interpret each price level’s reported sentiment.

This is intended to serve as an additional tool to use during your due diligence process & is not meant to replace doing your own research & is not financial advice.

Price Level:Volume Sentiment Analysis For SPY (S&P 500) ETF

SPY, the SPDR S&P 500 ETF hit an fresh all-time high today despite closing -0.3% yesterday in the wake of the FOMC interest rate announcement.

While recent price movements have been more volatile over the past couple of months it has helped them establish more nearby support levels to their current price than what they had during July’s check-in.

Still though, with the low volumes that we are seeing there is not much reason to celebrate just yet & as a result it is worth having an understanding of the strength of their support levels.

This is especially true as in the event of a 10% correction for SPY their price enters a Seller dominated zone which may possibly lead to further downside movements as support levels are weak in these price zones.

Below is a list of the volume sentiments at each price level SPY has traded at over the past 2-3 years.

$570 – NULL – 0:0*, +1.54% From Current Price

$565 – NULL – 0:0*, +0.65% From Current Price

$560 – Buyers – 10:1, -0.24% From Current Price – Current Price Level*

$555 – Sellers – 1.25:1, -1.13% From Current Price

$550 – Buyers – 1.92:1, -2.02% From Current Price – 10 & 50 Day Moving Averages**

$545 – Buyers – 1.67:1, -2.91% From Current Price

$540 – Sellers – 1.4:1, -3.81% From Current Price

$535 – Buyers – 2.33:1, -4.7% From Current Price

$530 – Buyers – 1.67:1, -5.59% From Current Price

$525 – Buyers – 5.6:1, -6.48% From Current Price

$520 – Buyers – 1.06:1, -7.37% From Current Price

$515 – Buyers – 1.3:1, -8.26% From Current Price – 200 Day Moving Average*

$510 – Even – 1:1, -9.15% From Current Price

$505 – Sellers – 1.19:1, -10.04% From Current Price

$500 – Sellers – 2.33:1, -11.64% From Current Price

$496 – Sellers – 1.69:1, -12.36% From Current Price

$492 – Buyers – 1.6:1, -12.36% From Current Price

$488 – Buyers – 1.27:1, -13.07% From Current Price

$484 – Buyers – 1.22:1, -13.78% From Current Price

$480 – Buyers – 1.4:0*, -14.49% From Current Price

$476 – Buyers – 1.14:1, -15.21% From Current Price

$472 – Buyers – 2.25:1, -15.92% From Current Price

$468 – Buyers – 1.1:1, -16.63% From Current Price

$464 – Sellers – 1.35:1, -17.34% From Current Price

$460 – NULL – 0:0*, -18.06% From Current Price

$456 – Buyers – 1:0*, -18.77% From Current Price

$452 – Buyers – 2.5:0*, -19.48% From Current Price

$448 – Even – 1:1, -20.19% From Current Price

$444 – Buyers – 3.47:1, -20.91% From Current Price

$440 – Buyers – 1.11:1, -21.62% From Current Price

$436 – Buyers – 1.25:1, -22.33% From Current Price

$432 – Buyers – 1.15:1. -23.04% From Current Price

$428 – Buyers – 1.1:1, -23.76% From Current Price

$424 – Buyers – 1.02:1, -24.47% From Current Price

$420 – Sellers – 1.24:1, -25.18% From Current Price

$416 – Sellers – 2.68:1, -25.89% From Current Price

$412 – Buyers – 1.86:1, -26.61% From Current Price

$408 – Sellers – 1.22:1, -27.32% From Current Price

$404 – Buyers – 1.8:1, -28.03% From Current Price

$400 – Sellers – 1.56:1, -28.74% From Current Price

$396 – Sellers – 1.98:1, -29.46% From Current Price

$392 – Buyers – 2.14:1, -30.17% From Current Price

$388 – Buyers – 2.27:1, -30.88% From Current Price

$384 – Sellers – 1.04:1, -31.59% From Current Price

$380 – Sellers – 1.95:1, -32.31% From Current Price

$376 – Sellers – 2.54:1, -33.02% From Current Price

$372 – Sellers – 1.65:1, -33.73% From Current Price

$368 – Sellers – 1.23:1, -34.44% From Current Price

$364 – Sellers – 1.69:1, -35.16% From Current Price

$360 – Sellers – 1.79:1, -35.87% From Current Price

$356 – Buyers – 1.11:1, -36.58% From Current Price

$352 – Sellers – 4.25:1, -37.3% From Current Price

$348 – Sellers – 2.9:0*, -38.01% From Current Price

$344 – Sellers – 0.6:0*, -38.72% From Current Price

$340 – NULL – 0:0*, -39.43% From Current Price

Price Level:Volume Sentiment Analysis For QQQ (NASDAQ 100) ETF

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 has begun to show more weakness than SPY after months of trading in similar manners.

While lower interest rates are more beneficial to this tech-heavy index, the size of yesterday’s cut indicates that there may be more weakness in the QQQ index components that in the medium-term may become more apparent compared to their SPY counterparts.

QQQ’s current price level is a seller dominated zone, as is the one directly below it & it is faced with a similar set up in the event of a 10% decline as SPY was noted to have.

Another item to note on QQQ’s chart is the proximity of price to the three moving averages shown, as a sudden movement downward would cause the price to become wedged in between all three, with the 10 & 50 day moving averages providing resistance from above & moving downwards, while the support of the 200 DMA would be pushing upwards, which may cause increased volatility.

There will be more on that in this weekend’s market review note; below is QQQ’s volume sentiment at each price level it has traded at for the past 2-3 years, as well as their support & resistance levels with the sentiments noted.

$505 – NULL – 0:0*, +7.14% From Current Price

$500 – Buyers – 0.6:0*, +6.08% From Current Price

$496 – Buyers – 2.4:0*, +5.23% From Current Price

$492 – Buyers – 0.7:0*, +4.39% From Current Price

$488 – Sellers – 3:1, +3.54% From Current Price

$484 – Buyers – 1.6:0*, +2.69% From Current Price

$480 – Buyers – 1.4:1, +1.84% From Current Price

$476 – Sellers – 1.05:1, +0.99% From Current Price

$472 – Sellers – 1.08:1, +0.14% From Current Price

$468 – Buyers – 1.58:1, -0.71% From Current Price – 50 Day Moving Average & Current Price Level**

$464 – Buyers – 0.9:0*, -1.56% From Current Price – 10 day Moving Average*

$460 – Buyers – 1.19:1, -2.4% From Current Price

$456 – Sellers – 1.63:1, -3.25% From Current Price

$452 – Buyers – 1.78:1, -4.1% From Current Price

$448 – Sellers – 2.4:1, -4.95% From Current Price

$444 – Buyers – 14.25:1, -5.8% From Current Price

$440 – Buyers – 1.84:1, -6.65% From Current Price – 200 Day Moving Average*

$436 – Buyers – 1.36:1, -7.5% From Current Price

$432 – Sellers – 2.93:1, -8.34% From Current Price

$428 – Buyers – 1.71:1, -9.19% From Current Price

$424 – Sellers – 1.04:1, -10.04% From Current Price

$420 – Sellers – 1.83:1, -10.89% From Current Price

$416 – Buyers – 2.1:0*, -11.74% From Current Price

$412 – Sellers – 2.5:0*, -12.59% From Current Price

$408 – Buyers – 1.85:1, -13.44% From Current Price

$404 – Buyers – 4.1:1, -14.29% From Current Price

$400 – Sellers – 1.03:1, -15.13% From Current Price

$396 – Buyers – 1.14:1, -15.98% From Current Price

$392 – Buyers – 2.67:1, -16.83% From Current Price

$388 – Buyers – 3.1:0*, -17.68% From Current Price

$384 – Sellers – 1.83:1, -18.53% From Current Price

$380 – Buyers – 2.75:1, -19.38% From Current Price

$376 – Buyers – 3.67:1, -20.23% From Current Price

$372 – Sellers – 1.08:1, -21.07% From Current Price

$368 – Sellers – 1.44:1, -21.92% From Current Price

$364 – Buyers – 1.52:1, -22.77% From Current Price

$360 – Buyers – 1.17:1, -23.62% From Current Price

$356 – Buyers – 1.21:1, -24.47% From Current Price

$352 – Sellers – 1.65:1, -25.32% From Current Price

$348 – Buyers – 2.84:1, -26.17% From Current Price

$344 – Buyers – 1.42:1, -27.02% From Current Price

$340 – Sellers – 1.17:1, -27.86% From Current Price

$336 – Buyers – 1.2:0*, -28.71% From Current Price

$332 – Buyers – 2:1, -29.56% From Current Price

$328 – Sellers – 1.19:1, -30.41% From Current Price

$324 – Buyers – 4.83:1, -31.26% From Current Price

$320 – Buyers – 2.59:1, -32.11% From Current Price

$316 – Buyers – 1.01:1, -32.96% From Current Price

$312 – Sellers – 2.7:1, -33.8% From Current Price

$308 – Buyers – 1.41:1, -34.65% From Current Price

$304 – Buyers – 2.14:1, -35.5% From Current Price

$300 – Sellers – 1.17:1, -36.35% From Current Price

$296 – Buyers – 1.25:1, -37.2% From Current Price

$292 – Buyers – 3.52:1, -38.05% From Current Price

$288 – Sellers – 1.39:1, -38.9% From Current Price

$284 – Even – 1:1, -39.74% From Current Price

$280 – Sellers – 1.3:1, -40.59% From Current Price

$276 – Buyers – 1.18:1, -41.44% From Current Price

$272 – Sellers – 1.85:1, -42.29% From Current Price

$268 – Sellers – 1.14:1, -42.14% From Current Price

$264 – Buyers – 1.04:1, -43.14% From Current Price

$260 – Sellers – 1.9:1, -44.84% From Current Price

$256 – Sellers – 6.4:0*, -45.69% From Current Price

$252 – NULL – 0:0*, -46.53% From Current Price

Price Level:Volume Sentiment Analysis For IWM (Russell 2000) ETF

IWM, the iShares Russell 2000 ETF has been unable to retest their 52-week high set just before our last check in in July, but their recent volume levels have jumped compared to the previous handful of months.

This index trades in a much more consolidated range-bound fashion & slowly advances while oscillating around a price range compared to how SPY & QQQ trade, so their list of price levels for the past 2-3 years is shorter than the previous two ETFs.

This is beneficial for them though, as it provides them with more local support levels, which are outlined in the data below.

$228 – NULL – 0:0*, +3.92% From Current Price

$224 – Buyers – 1.6:0*, +2.1% From Current Price

$220 – Buyers – 2.86:1, +0.27% From Current Price

$216 – Sellers – 3.3:1, -1.55% From Current Price – Current Price Level*

$212 – Buyers – 1.69:1, -3.37% From Current Price – 10 & 50 Day Moving Averages**

$208 – Buyers – 2:1, -5.2% From Current Price

$204 – Buyers – 1.69:1, -7.02% From Current Price

$200 – Even – 1:1, -8.84% From Current Price – 200 Day Moving Average*

$198 – Buyers – 2.08:1, -9.75% From Current Price

$196 – Buyers – 1.25:1, -10.67% From Current Price

$194 – Buyers – 1.29:1, -11.58% From Current Price

$192 – Sellers – 3.96:1, -12.49% From Current Price

$190 – Buyers – 1.08:1, -13.4% From Current Price

$188 – Sellers – 1.46:1, -14.31% From Current Price

$186 – Buyer – 4:1, -15.22% From Current Price

$184 – Buyers – 3.55:1, -16.13% From Current Price

$182 – Buyers – 1.04:1, -17.05% From Current Price

$180 – Sellers – 1.23:1, -17.96% From Current Price

$178 – Sellers – 1.26:1, -18.87% From Current Price

$176 – Buyers – 1.97:1, -19.78% From Current Price

$174 – Buyers – 1.4:1, -20.69% From Current Price

$172 – Buyers – 1.22:1, -21.6% From Current Price

$170 – Sellers – 1.93:1, -22.52% From Current Price

$168 – Sellers – 1.65:1, -23.43% From Current Price

$166 – Sellers – 3.1:1, -24.34% From Current Price

$164 – Sellers – 3:1, -25.25% From Current Price

$162 – Buyers – 1.36:1, -26.16% From Current Price

$160 – NULL – 0:0*, -27.07% From Current Price

Price Level:Volume Sentiment Analysis For DIA (Dow Jones Industrial Average) ETF

DIA, the SPDR Dow Jones Industrial Average ETF trades in a manner that is more similar to IWM than to SPY or QQQ.

As a result, they too have more local support levels than SPY or QQQ, as the blue chip index tends to be an investor favorite.

This leads them to have a great deal of Buyer support, which in the event of a decline we will see their ratios become more diluted than they are currently in the data below from the past 3-4 years.

$420 – NULL – 0:0*, +0.9% From Current Price

$416 – Buyers – 0.2:0*, -0.06% From Current Price – Current Price Level*

$412 – Buyers – 0.8:0*, -1.02% From Current Price

$408 – Buyers – 3.4:1, -1.98% From Current Price – 10 Day Moving Average*

$404 – Buyers – 1.2:1, -2.95% From Current Price – 50 Day Moving Average*

$400 – Sellers – 2:1, -3.91% From Current Price

$396 – Buyers – 3.2:1, -4.87% From Current Price

$392 – Buyers – 1.9:1, -5.83% From Current Price

$388 – Buyers – 1.36:1, -6.79% From Current Price

$384 – Buyers – 1.07:1, -7.75% From Current Price – 200 Day Moving Average*

$380 – Buyers – 1.31:1, -8.71% From Current Price

$376 – Even – 1:1, -9.67% From Current Price

$372 – Buyers – 1.8:1, -10.63% From Current Price

$368 – Buyers – 2.11:1, -11.59% From Current Price

$364 – Sellers – 1.5:1, -12.55% From Current Price

$360 – Buyers – 0.3:0*, -13.52% From Current Price

$356 – Even – 1:1, -14.48% From Current Price

$352 – Buyers – 0.2:0*, -15.44% From Current Price

$348 – Buyers – 14:1, -16.4% From Current Price

$344 – Buyers – 1.03:1, -17.36% From Current Price

$340 – Buyers – 1.24:1, -18.32% From Current Price

$336 – Buyers – 1.5:1, -19.28% From Current Price

$332 – Buyers – 1.34:1, -20.24% From Current Price

$328 – Buyers – 1.04:1, -21.2% From Current Price

$324 – Buyers – 1.08:1, -22.16% From Current Price

$320 – Sellers – 2.19:1, -23.12% From Current Price

$316 – Buyers – 1.09:1, -24.09% From Current Price

$312 – Sellers – 1.2:1, -25.05% From Current Price

$308 – Sellers – 2.58:1, -26.01% From Current Price

$304 – Buyers – 1.36:1, -26.97% From Current Price

$300 – Sellers – 1.44:1, -27.93% From Current Price

$296 – Sellers – 2.33:1, -28.89% From Current Price

$292 – Sellers – 1.36:1, -29.85% From Current Price

$288 – Even – 1:1, -30.81% From Current Price

$284 – Sellers – 3.33:1, -31.77% From Current Price

$280 – Sellers – 12:1, -32.73% From Current Price

$276 – NULL – 0:0*, -33.7% From Current Price

*** I DO NOT OWN SHARES OR OPTIONS CONTRACT POSITIONS IN SPY, QQQ, IWM OR DIA AT THE TIME OF PUBLISHING THIS ARTICLE ***

SPY, the SPDR S&P 500 ETF gained +4.01% last week, while the VIX closed at 16.56, indicating an implied one day move of +/-1.04% & an implied one month move of +/-4.79%.

Their RSI is currently between neutral & overbought sitting at 59.02, while their MACD crossed over bullishly on Friday, but the histogram is not indicating that it was a particularly strong move.

Volumes were -28.58% below average last week compared to the previous year’s average (48,658,000 vs. 68,131,937), which is a warning signal given that all of the five sessions of the week were advancing.

Monday kicked SPY’s week off on an uncertain note, as the session opened midway between Friday’s candle’s real body & wound up closing as a spinning top on the week’s second lowest volume, forming a bullish harami with Friday’s candle.

It’s worth noting that the 50 day moving average’s resistance was not tested during this session.

Tuesday the trend continued, as the session opened on a gap higher, tested below the real body of Monday’s candle, before closing just beneath the resistance of the 50 DMA, creating a dragonfly doji on the week’s weakest volume.

The bulls won on Wednesday though, as SPY opened in line with the 50 DMA, tested lower, before ultimately rallying higher & closing above the 50 & 10 day moving averages, turning their resistance levels to support.

Wednesday had the strongest volume of the week by far, however it also covered the widest range of prices throughout the session by far as well for the week, including the need to push past the two resistance points created by the moving averages.

It is also worth noting that the low point on Wednesday’s session was near the $540/share price level, which is roughly in line with the previous Friday’s close, indicating that there was still enough bearish appetite left in the market to push prices back in that direction.

Thursday the rally continued & SPY edged higher, solidifying the 10 DMA’s support on its test on the daily low, but again, the volumes were still very light (despite being the second highest of the week).

Friday was the most interesting day of the week, where the middle of the pack volume accompanied a gap up spinning top, indicating a big lack of confidence at the current price level.

This is further confirmed by the inability of the day’s high to break above the $564.20/share resistance level, which is the next closest one to the all-time high of $565.16.

This sets the market up for an interesting new week for SPY, as another key area to note is that the bottom is even more narrow on the “Adam scallop” recovery from the early September declines, indicating a lack of confidence in the leg higher.

Broadening patterns tend to perform better than those that are more narrow, as more price levels are tested, new support & resistance levels are created & there is more validity behind each price level tested.

Additionally, Friday’s gap up may set the stage for an evening star reversal (bearish) in the event of weakness on Monday’s session.

This week volume will continue to be a major theme, along with what Monday’s session sets up the rest of the week for, as there will be a handful of earnings reports & the FOMC Interest Rate cut decision due Wednesday.

There is 0.56% upside from Friday’s closing price & SPY’s all-time high that was set in July 2024, meaning that for the most part any further bullishness would reset SPY’s all time high.

Given that the high in August of $564.20 was unable to reach the ATH & there has been limited good news since then it is hard to see SPY taking off much higher here.

However, investors should keep their eye open in the event of a move higher to be sure that it is not a false breakout that throws back into the current price range/begins a decline.

It will also be important that in the event of any downside movement that market participants watch the support zone between $549.73-$554.87, as in the event that it breaks down there is another 2% of space for their price to decline before another support level is found.

Keep an eye on SPY’s RSI this week as well, as it is approaching its highest levels of the past month, which may indicate that there is some selling on the horizon.

SPY has support at the $554.87 (Volume Sentiment: Buyers, 2:1), $552.74 (10 Day Moving Average, Volume Sentiment: Buyers, 2:1), $549.73 (50 Day Moving Average, Volume Sentiment: Buyers, 2:1) & $539.44/share (Volume Sentiment: Buyers, 0.7:0*) price levels, with resistance at the $564.20 (Volume Sentiment: Buyers, 0.8:0*) & $565.16/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 advanced +5.94% last week, as market participants flocked into the tech heavy index over the other major four index ETFs.

Their RSI is currently at 55.88, just above the neutral mark of 50 while their MACD crossed over bullishly on Friday.

Volumes were -11.96% below the previous year’s average volume (37,958,000 vs. 43,116,245), which while it is a better “participation rate” than SPY’s is still rather low, particularly when you factor in how much the annual average volume level has declined since only six months ago (comparison for all index ETFs in 8/18/2024’s Market Review Note here).

QQQ’s week was quite a bit like SPY’s, as has been the case for the past year when the AI & Semiconductor component names have driven these indexes higher than IWM or DIA.

Monday opened up with a spinning top candle midway through Friday’s candle’s real body on weak volume, with a lower shadow that indicated a lot more bearish sentiment that bulls ultimately overcame before the close & the day’s candle formed a bullish harami with the previous Friday’s.

Tuesday showed a gap up open for QQQ, a test to the downside towards Monday’s opening price, but ultimately a rally higher that closed for an advancing session.

QQQ gapped up again on Wednesday, however it also tested lower than Tuesday & lower than Monday’s opening price level during the session, despite breaking out above the 10 day moving average’s support & closing between it & the 50 DMA’s resistance.

Wednesday also had the highest volume of the week for QQQ, which is to be expected given that the day’s range covered the majority of the entire week’s advance as one session.

Thursday the gains continued, the volume was the second highest of the week & despite testing lower briefly, QQQ was able to break out about the 50 Day Moving Average’s resistance.

Friday showed the weakest volume of the week for QQQ, as well as the potential warning sign for the near-term, despite advancing +0.45%.

While the upper shadow was not long enough to categorize Friday’s session as a shooting star, there are certainly bearish implications with how the week ended, particularly as like SPY the recovery from the losses of early September were unable to break above any of the top three resistance levels & the bases of them are all contracting.

While volumes were certainly closer to levels that they’re historically at last week, they still aren’t particularly strong, especially when viewed through the lens of how diluted the average annual volume has become in the wake of the past few months.

It would also be wise to keep an eye on QQQ’s RSI this week, as it is approaching levels it has reversed at in the previous month.

While this doesn’t mean QQQ will necessarily reverse at the same levels again, there has been little good news coming out since these levels were last hit, making it more likely that they’ll reverse there again.

The relationship between each day’s price action & the support levels of the 50 & 10 DMAs will also be important to keep an eye on, as within the past week both of these moving averages have seen a lot of tests as both support & resistance levels, and while prices climbed all week, there was still a lot of interest to the downside based on the daily candles’ lower shadows.

In the event that the $475.55 resistance level is broken through, all eyes will be on the $485.54 resistance level, which if unable to be broken through will indicate that there is likely an impending decline.

QQQ has support at the $470.49 (50 Day Moving Average, Volume Sentiment: NULL, 0:0*), $463.87 (10 Day Moving Average, Volume Sentiment: Even, 1:1), $459.85 (Volume Sentiment: Buyers, 0.9:0*) & $448.63/share (Volume Sentiment: Sellers, 2.3:0*) price levels, with resistance at the $475.55 (Volume Sentiment: Buyers, 2.5:1), $485.54 (Volume Sentiment: Buyers, 1.3:0*) & $503.52/share (All-Time High, Volume Sentiment: Buyers, 0.4:0*) price levels.

IWM, the iShares Russell 2000 ETF climbed +4.03% last week, making the small cap index the second most favored of the major four index ETFs.

Their RSI is just above the neutral 50 mark & sits at 56.33, while their MACD is still bearish, but approaching the signal line rapidly & may cross bullishly in the coming day or two.

Volumes were -21.26% below average last week compared to the previous year’s average volume (27,768,000 vs. 35,267,233), as investors were still relatively on the fence about diving back into the small cap pool.

IWM also began their week on an uncertain note, as the session opened slightly above Friday’s close & tested lower, before ultimately tested back above the $210/share mark & settling into a tight-range spinning top candle just above the day’s open (but not close enough to be a doji) that formed a bullish harami with the prior Friday’s candle on some of the weakest volume of the low volume week.

Tuesday confirmed the uncertainty in the air, as the session opened slightly higher, tested a small amount higher, before puking lower to below the $206/share range & ultimately closing in a candle whose real body looked like a slightly stretched out dragonfly doji; indicating the uncertainty was there but there was also a possible squeeze moving into the latter half of the week.

Wednesday saw an uptick in volume, as well as a test much lower after the session’s open, but managed to rally into the sloe & end the day slightly higher.

Thursday opened on a gap up that tested back against the downside & Wednesday’s closing price before rallying higher, breaking the 10 day moving average’s resistance briefly before getting denied by the 50 DMA’s resistance & tumbling back to close as an advancing session but below both the 10 & 50 DMAs.

Friday made for an interesting close to the week, as IWM gapped up above both the 10 & 50 DMA’s on the open, briefly tested a bit lower but did not approach other support level before ultimately rallying into the close for a +2.47% advance.

While the session came on the strongest volume of the week, much like QQQ it closed unable to reach the top three resistance levels from the past 52-weeks.

These levels are all ~2.6%+ from Friday’s closing level, but when paired with the contracting bottoms forming in each of the past few declines’ recoveries there is cause for concern.

Volume will continue to be a main theme for IWM this week just like the past few weeks.

Much like SPY & QQQ, IWM’s RSI will also be a place to be mindful of as it too is approaching the levels it last reversed at in August.

The support of the 50 & 10 DMA’s will also be an area of focus, as if they break down IWM will enter an area where there is a support level roughly every 1% further down, with zones in the $202.36 (200 Day Moving Average)-$204.21 & $195.35-198.60.

Should prices enter these zones the chart below will be helpful for establishing how strong each support point may be when tested.

Note that the 200 DMA is i the weakest price range in terms of Buyer:Seller strength in the event that it is tested in the coming week(s).

IWM has support at the $215.38 (Volume Sentiment: NULL, 0:0*), $213.38 (Volume Sentiment: NULL, 0:0*), $212.04 (Volume Sentiment: NULL, 0:0*) & $211.29/share (Volume Sentiment: Buyers, 2.4:0*) price levels, with resistance at the $222.45 (Volume Sentiment: NULL, 0:0*), $226.64 (Volume Sentiment: NULL, 0:0*) & $228.63/share (52-Week High, Volume Sentiment: NULL, 0:0*) price levels.

DIA, the SPDR Dow Jones Industrial Average ETF had the worst week of the bunch, only notching +2.59% for the weekly gain.

Their RSI is midway between the neutral point of 50 & the overbought level of 70, sitting at 61.32, while their MACD is poised to cross the signal line bullishly on Monday.

Volumes were -7.51% below the previous year’s average (3,296,000 vs. 3,563,715), as investors have remained relatively resilient in terms of participation in trading the blue chip index.

DIA’s week started off with a bullish harami formed by Monday & the previous Friday’s candle last week, but there were signs of weakness as the 10 day moving average’s resistance was unable to be broken through.

Tuesday this trend continued, as the session opened optimistically at the 10 DMA’s resistance level, but was unable to break out above it & wound up declining throughout the day, so low as to even test the ~$405/share level & the session ultimately resulted in decline.

The cautious sentiment carried on into Wednesday, where prices opened lower, tested all the way down to break beneath the support of the 50 day moving average temporarily, before recovering to go on to test & get rejected by the 10 DMA’s resistance & ultimately close for an advancing session.

Thursday saw DIA open just below the resistance of the 10 DMA, test lower almost all the way down to Wednesday’s opening price level, before DIA rallied higher, broke through the 10 DMA & closed above it turning it into a support level.

Friday is where things got interesting, as the day opened on a gap up, did not test much lower than the open & trudged higher on the highest volume of the week.

However, the size of Friday’s candle’s upper shadow is cause for concern, as it signals that the bears came out in droves & took profits sending the closing price lower than the day’s high.

Like the previously mentioned names, volume will be a heavy part of the story this week for DIA in terms of dictating where market participant sentiment lies.

Their RSI is also approaching the level it reversed at last month like the other three ETFs mentioned above, and while DIA’s may venture slightly higher as the index is filled with blue chip names, that would begin encroaching on overbought territory, which would trigger some form of consolidation/correction in price.

In the event that is triggered & prices decline there is a strong zone of support in the $399-400 & $395.08-397.76 price ranges that have multiple touch-points each within them & it will be interesting to see how they hold up, given that they have had limited testing against downside movements.

The table below can help assess how strong each support level may be based on historic Buyer:Seller activity.

DIA has support at the $413.33 (Volume Sentiment: NULL, 0:0*), $410.33 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $403.79 (50 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $400.81/share (Volume Sentiment: NULL, 0:0*) price levels, with resistance at the $416.55/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Monday starts the week off with the Empire State Manufacturing Survey data at 8:30 am & there are no major earnings reports.

U.S. Retail Sales & Retail Sales minus Autos are due out Tuesday at 8:30 am, followed by Industrial Production & Capacity Utilization data at 9:15, before Business Inventories & Home Building Confidence Index data is released at 10 am.

Ferguson reports earnings before Tuesday’s opening bell.

Wednesday begins with Housing Starts & Building Permits data at 8:30 am before the eagerly anticipated FOMC Interest Rate Decision at 2pm & Fed Chair Powell’s Press Conference at 2:30 pm.

General Mills reports earnings before Wednesday’s opening bell, with Steelcase scheduled to report following the session’s close.

Initial Jobless Claims & the Philadelphia Fed Manufacturing Survey data come out Thursday at 8:30 am, followed by Existing Home Sales & U.S. Leading Economic Indicators at 10 am.

Thursday brings Cracker Barrel, Darden Restaurants, Endava & FactSet’s earnings call’s before the session opens, with FedEx, Lennar, & MillerKnoll all scheduled to report after the close.

There are no major economic announcements or earnings reports due out on next Friday.

See you back here next week!

*** I DO NOT OWN SHARES OR OPTIONS CONTRACT POSITIONS IN SPY, QQQ, IWM OR DIA AT THE TIME OF PUBLISHING THIS ARTICLE ***