Category: Market News, Research & Commentary

SPY, the SPDR S&P 500 ETF slid -2.08% this week, while the VIX closed at 16.14, indicating an implied one day move of +/-1.02% & an implied one month move of +/-4.67% for the S&P 500.

Their RSI is trending back down toward the neutral level & currently sits at 52.43, while their MACD has curled over bearishly & will likely cross the signal line within the first day or two of the week.

Volumes were -23.98% lower than the prior year’s average level (46,144,000 vs. 60,703,202), as investors are still timid near all-time highs for SPY.

For over seven months now volumes have been drastically lower than they had been in the years prior, which brings up questions regarding is it hesitancy due to the high price levels & valuations, or is there something else out there that is keep money on the sidelines.

Last Monday SPY kicked the week off on a foreboding note, as despite an advancing session that hit their current all-time high, the day resulted in a hanging man candle that closed lower than it opened (bearish).

It should also be noted that this was the lowest volume session of the day, which makes the move even more alarming.

Tuesday the bad times continued, as the day opened lower, tested slightly higher, only to decline & reinforce the negative sentiment that Monday began the week with.

Wednesday the market temporarily found equilibrium as the day resulted in a doji candle that closed slightly higher than the day prior’s on the second highest volume of the week.

Things resumed heading south on Thursday with a declining session that began filling in the window created by the previous Thursday’s gap up session.

Friday was a risk off into the weekend type of day, opening on a gap down near the 10 day moving average & blowing through the support level to close lower on the day on the highest volume of the week.

This coming week should be interesting (this note is late as I was OOO Monday) as there are a handful of Fed speakers & NVDIA’s earnings report is due out Wednesday.

The Fed speakers aren’t likely to tell us anything we don’t already know & it seems that SPY is consolidating within Friday’s candle’s range while waiting to see what comes from that report.

In the event it moves us to the upside the $600.17/share mark will be where all eyes focus to see if the resistance level can be broken.

In the event it’s a downside surprise the window that is at the $580/share level from October will be in focus, as it was gapped both below & over & because the $575-579.99 level is a seller dominated price zone which will likely cause further declines.

This will be problematic as there are not many local support levels for SPY from its current price & may mean it struggles to find footing until after a loss of 3-5%.

SPY has support at the $586.12 (Volume Sentiment: Buyers, 0.4:0*), $575.29 (50 Day Moving Average, Volume Sentiment: Sellers, 1.1:1), $567.89 (Volume Sentiment: Sellers, 2:1) & $563.43/share (Volume Sentiment: Buyers, 1.7:0*) price levels, with resistance at the $590.33 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $600.17/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF dropped -3.42% last week, as market participants were taking some profits after the prior week’s gap up sessions.

Their RSI is has just passed bearishly through the neutral level of 50 & sits currently at 48.65, while their MACD is set to cross the signal line bearishly during Monday’s session.

Volumes were -21.76% below the previous year’s average level (30,342,000 vs. 38,782,885), which like SPY means that they were dramatically lower than the prior year’s average from seven months ago, begging the question of where this money is & why.

QQQ’s week looks awfully similar to SPY’s, except that all of QQQ’s candles are red, while SPY had some that were filled black as they closed lower than they opened but advanced on the open.

Monday resulted in a new all-time high for QQQ on low volume that also was a hanging man candle, predicting the bearishness the rest of the week followed with.

Tuesday continued lower, but the $510/share level was not broken through as investors seemed to think that was a fair valuation again on Wednesday when prices approached it, but did not break down through it.

Wednesday closed in a doji, indicating that there was temporary equilibrium in the eyes of market participants, before Thursday finally broke down the $510/share level to close beneath it.

Friday everything fell apart as QQQ gapped down to open below the 10 day moving average’s support & only continued lower throughout the day on the week’s highest volume.

Profits from the prior week’s gaps were taken 0ff of the table as investors await NVDA’s earnings report on Wednesday, as it will lend clues into the state of technology names.

In the event of a good report, QQQ has a few resistance levels to break through before they reach their all-time high, as like SPY so far this week they’ve just consolidated into the range set by Friday’s candle’s real body.

In the event they break out above the $502.81 mark the 10 DMA’s resistance will be interesting, given how hard they fell through it on Friday as a support level.

On the downside the 50 DMA is the second nearest support level, with the $493.70 one occurring in a price level that has been overwhelming strong for the buyers historically.

While Friday’s high volume may be viewed as some as ammunition getting ready to be reemployed in the market, based on how low volumes have been in the past seven months & how high Friday’s bearish session’s volume was we may be looking at more declining behavior in the near-term.

QQQ has support at the $493.70 (Volume Sentiment: Buyers, 17.25), $489.20 (50 Day Moving Average, Volume Sentiment: Buyers, 1.25:1), $484.86 (Volume Sentiment: Buyers, 3.5:1) & $483.75/share (Volume Sentiment: Buyers, 1.2:1) price levels, with resistance at the $501.35 (Volume Sentiment: Buyers, 2:0*), $502.81 (Volume Sentiment: Buyers, 2:0*), $505.57 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $515.58/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

IWM, the iShares Russell 2000 ETF had the worst week of the major four index ETFs, declining -4.05% as investors took profits on the heels of their outperformance from last week.

Their RSI is near the neutral 50 mark & sits at 52.09, while their MACD is bearishly approaching the signal line & looks set to cross over it early this week.

Volumes were -7.19% below the previous year’s average level (30,872,000 vs. 33,265,375), which is rare to see these days, as IWM has been trading at higher volume levels than it had been seven months ago (unlike SPY & QQQ).

Unlike SPY & QQQ, WM’s week kicked off on an advancing session that reached a new all-time high, but it was on low volume & resulted in a spinning top candle which means that there was a bit of uncertainty among market participants.

This led to the avalanche of tall red candles that came throughout the rest of the week, as investors took their profits from the previous week & went running.

Thursday’s session saw a temporary breakdown of the 10 DMA’s support, which led to Friday’s open below it & continued move downward towards near the $227.50/share level ($227.81).

IWM’s closing level on Friday sits right atop the $227/share support zone, but the window created by last Wednesday is still sitting open & the past couple of weeks have shown both the tops & bottoms of IWM’s trading begin to close up & narrow, indicating that there is an added degree of uncertainty in the market right now.

Should the window continue to close, the 50 Day Moving Average will become the place of focus as it continues moving higher & will likely be near the bottom of the window by the time a test comes.

The first four support levels from Friday’s close have been seller dominated 2:1 over the past 3-4 years.

As for the upside, if IWM breaks above its 10 DMA the only resistance level above it is the all-time high, which it will need some strong volume to break above.

This may prove difficult, given that IWM’s current average prior year’s volume is already higher than it was seven months ago, which is not the case for SPY or QQQ.

IWM has support at the $227.85 (Volume Sentiment: Sellers, 2:1), $227.17 (Volume Sentiment: Sellers, 2:1), $225.87 (Volume Sentiment: Sellers, 2:1) & $224.17/share (Volume Sentiment: Sellers, 2:1) price levels, with resistance at the $233.07 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $243.39/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

DIA, the Dow Jones Industrial Average ETF fared the best this week of the major four index ETFs, falling just -1.27%.

Their RSI is trending back down towards neutral & sits currently at 57.03, while their MACD has curled over bearishly & looks primed to cross through the signal line by mid-week.

Volumes were -8.4% below the prior year’s average (3,162,000 vs. 3,451,937), as investors are skittish, but still wetting their beaks on the blue chip index’s components.

Monday kicked off the week with a shooting star candle (bearish) with a new all-time high for DIA.

Tuesday set the stage for some hard times to come, when a bearish engulfing candle sent DIA below the $440/share level before Wednesday’s doji candle that finished relatively in line with Tuesday’s close.

Wednesday the pain continued, as DIA opened higher before another wide-range bearish engulfing candle came from the day’s session, which led to the pain DIA felt Friday when prices gapped down & continued lower after the open to close just below the resistance of the 10 day moving average.

Tomorrow will be an interesting day, as NVDA’s earnings do not directly impact DIA or IWM as they are not a component of those indexes, which will be something for folks to keep in mind over the coming two days of trading.

DIA has a large window from the previous week to fill in on the downside, with their all-time high being the only resistance level, but one that will be a formidable level to break above.

DIA has support at the $432.94 (Volume Sentiment: Buyers, 0.6:0*), $425.79 (Volume Sentiment: Sellers, 1.67:1), $423.86 (50 Day Moving Average, Volume Sentiment: Buyers, 3.2:1) & $417.86/share (Volume Sentiment: Sellers, 7:1) price levels, with resistance at the $434.71 (10 Day Moving Average, Volume Sentiment: Buyers, 0.6:0*) & $444.60/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Home Builder Confidence Index data & Fed President Goolsbee speaking are Monday morning’s big market data, each coming in at 10 am.

Monday morning kicks off with reports from Brady (BRC) & Twist Bioscience, followed by AECOM, BellRing Brands & Symbiotic after the session’s close.

Tuesday morning features Housing Starts & Building Permits data at 8:30 am, followed by Fed President Goolsbee speaking again at 12:25 pm.

Walmart, Amer Sports, Energizer, Jacobs Solutions, Lowe’s, Medtronic, Oaktree Specialty Lending Corp, Viking Holdings, Vipshop & Weibo report earnings before the opening bell on Tuesday, with Alcon, AZEK, Dolby Labs, Golub Capital, Keysight, La-Z-Boy, Powell Industries, Varex Imaging & ZTO Express set to report after the closing bell.

Wednesday is another Fed speaker day, with Governor Cooks speaking at 11 am & Governor Bowman speaking at 12:15 pm.

Wednesday morning’s earnings reports include Berry Global, Dycom, Global-E Online, Nio, Spire, Target, TJX Companies & Wix.com, followed by NVDA, Copa Holdings, Jack In The Box, Maximus, Palo Alto Networks, Snowflake & Sociedad Quimica y Minera after the session’s closing bell.

Thursday begins with Initial Jobless Claims & Philadelphia Fed Manufacturing Survey Data at 8:30 am, Fed President Hammack speaking at 8:45 am, Existing Home Sales & Leading Economic Index data reported at 10 am, Fed President Schmid speaking at 1:10 pm & Fed Vice Chair For Supervision Barr speaking at 4:40 pm.

Deere & Company, Atkore International, BJ’s Wholesale, KE Holdings, Shoe Carnival, Vestis & Warner Music Group report earnings on Thursday morning before the session’s open, with Copart, Elastic, Gap, Intuit, Ross Stores & UGI Group reporting after the close.

S&P Flash U.S. Services PMI & S&P Flash U.S. Manufacturing PMI data come out Friday morning at 9:45 am, followed by Consumer Sentiment (final) data at 10 am & Fed Governor Bowman speaking at 6:15 pm.

Friday’s primary earnings report is Buckle before the session’s open.

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 ***

It’s been about two months since the last check in of the major index ETF’s price level:volume sentiment & a lot has happened in that time.

Markets have continued to grind higher though in the face of the US Presidential Election, bad weather events causing widespread damage & today’s PPI print coming in hotter than expected after two straight consecutive rate cuts & all of the major index ETFs sit near their all-time highs.

The VIX is currently at 14.13 after remaining elevated for the month of October & now shows an implied one day move of +/-0.89% & an implied one month move of +/-4.08%.

With the election results seeming to have calmed the market’s nerves quite a bit it is time to run through the Buyer:Seller sentiment at each price level that the major indexes have traded at over the past few years.

This may shed light into how market participants will behave if the same price levels are entered/re-tested again in the near future.

As noted in the last note, due to the markets being near all-time highs there are many price levels that lack enough information to make a reading on, but that have been traded at, which will be denoted as “NULL”, most of which occur near the extreme highs & lows of the listed ranges below.

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, similar to a barometer 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, The SPDR S&P 500 ETF

SPY, the SPDR S&P 500 ETF enjoyed a massive gap up following the election after spending most of October straddling its 10 day moving average.

Since Tuesday it has shown that folks are beginning to take profits following the move upward, which has all eyes looking at the window created by the post-election gap up.

There are two support levels near the lower end of the gap, one of which being the 10 day moving average which continues higher on a daily basis.

While this may help slow any declines, should the support & the $586-level be broken the next stop is the 50 DMA’s support.

With this in mind, it is worth looking at how investors have behaved over the past few years at each price level to see if it lends clues into how they may choose to behave again in the near-future.

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

$605 -NULL – 0:0*, +1.31% From Current Price Level

$600 – NULL – 0:0*, +0.47% From Current Price Level – All-Time High*

$595 – NULL – 0:0*, -0.37% From Current Price Level – Current Price Level*

$590 – NULL – 0:0*, -1.2% From Current Price Level

$585 – Buyers – 0.4:0*, -2.04% From Current Price Level – 10 Day Moving Average*

$580 – Buyers – 1.86:1, -2.88% From Current Price Level

$575 – Sellers – 1.1:1, -3.72% From Current Price Level

$570 – Buyers – 4.5:1, -4.55% From Current Price Level – 50 Day Moving Average*

$565 – Sellers – 2:1, -5.39% From Current Price Level

$560 – Buyers – 1.7:0*, -6.23% From Current Price Level

$555 – Buyers – 1.54:1, -7.06% From Current Price Level

$550 – Buyers – 1.33:1, -7.9% From Current Price Level

$545 – Buyers – 1.56:1, -8.74% From Current Price Level

$540 – Buyers – 1.17:1, -9.58% From Current Price Level

$535 – Sellers – 1.1:1, -10.41% From Current Price Level – 200 Day Moving Average*

$530 – Buyers – 1.44:1, -11.25% From Current Price Level

$525 – Buyers – 3.67:1, -12.09% From Current Price Level

$520 – Buyers – 3.6:1, -12.93% From Current Price Level

$515 – Sellers – 1.14:1, -13.76% From Current Price Level

$510 – Buyers – 1.67:1, -14.6% From Current Price Level

$505 – Sellers – 1.43:1, -15.44% From Current Price Level

$500 – Buyers – 1.04:1, -16.27% From Current Price Level

$496 – Sellers – 1.75:1, -16.94% From Current Price Level

$492 – Buyers – 1.14:1, -17.61% From Current Price Level

$488 – Buyers – 1.43:1, -18.28% From Current Price Level

$484 – Buyers – 1.25:1, -18.95% From Current Price Level

$480 -Buyers – 2.17:1, -19.62% From Current Price Level

$476 – Buyers – 1.5:1, -20.29% From Current Price Level

$472 – Buyers – 2.2:0*, -20.96% From Current Price Level

$468 – Sellers – 1.38:1, -21.63% From Current Price Level

$464 – Even – 1:1, -22.3% From Current Price Level

$460 – Sellers – 1.83:1, -22.97% From Current Price Level

$456 – Buyers – 0.4:0*, -23.64% From Current Price Level

$452 – Buyers – 2.9:0*, -24.31% From Current Price Level

$448 – Buyers – 1.22:1, -24.98% From Current Price Level

$444 – Buyers – 3.25:1, -25.65% From Current Price Level

$440 – Buyers – 1.7:1, -26.32% From Current Price Level

$436 – Buyers 1.03:1, -26.99% From Current Price Level

$432 – Buyers – 1.22:1, -27.66% From Current Price Level

$428 – Buyers – 1.38:1, -28.33% From Current Price Level% From Current Price Level

$424 – Sellers – 1.63:1, -29% From Current Price Level

$420 – Sellers – 1.23:1, -29.67% From Current Price Level

$416 – Buyers – 2.5:1, -30.34% From Current Price Level

$412 – Buyers – 2.18:1, -31.01% From Current Price Level

$408 – Buyers – 1.03:1, -31.68% From Current Price Level

$404 – Buyers – 2.42:1, -32.35% From Current Price Level

$400 – Buyers – 1.15:1, -33.02% From Current Price Level

$396 – Sellers – 2.31:1, -33.69% From Current Price Level

$392 – Buyers – 1.4:1, -34.36% From Current Price Level

$388 – Buyers – 1.72:1, -35.03% From Current Price Level

$384 – Buyers – 1.73:1, -35.7% From Current Price Level

$380 – Sellers – 1.53:1, -36.37% From Current Price Level

$376 – Sellers – 2.68:1, -37.04% From Current Price Level

$372 – Sellers – 1.97:1, -37.71% From Current Price Level

$368 – Sellers – 1.41:1, -38.38% From Current Price Level

$364 – Sellers – 1.73:1, -39.05% From Current Price Level

$360 – Sellers – 2.1:1, -39.72% From Current Price Level

$356 – Buyers – 1.73:1, -40.39% From Current Price Level

$352 – Sellers – 2.35:1, -41.06% From Current Price Level

$348 – Sellers – 0.6:0*, -41.73% From Current Price Level

$344 – Sellers – 0.8:0*, -42.4% From Current Price Level

$340 – NULL – 0:0*, -43.07% From Current Price Level

Price Level:Volume Sentiment Analysis For QQQ, The Invesco QQQ Trust ETF

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 has enjoyed a similar post-election jump to SPY & also sits just off of all-time highs that were set on Monday.

Much like SPY they have also traded on weak volume recently, as there is indeed a bit of hesitancy among market participants to dive into the pool near such high price levels.

QQQ has more local support levels than SPY after the declines of July forced a slower recovery & consolidations that created more support/resistance touch-points.

Still, it is important to understand how they’ve traded historically at the price levels of the past few years, especially given the two gap ups that created two windows last week.

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.

$520 – NULL – 0:0*, +1.51% From Current Price Level

$515 – NULL – 0:0*, +0.54% From Current Price Level – All-Time High*

$510 – NULL – 0:0*, -0.44% From Current Price Level – Current Price Level*

$505 – NULL – 0:0*, -1.42% From Current Price Level

$500 – Buyers – 2:0*, -2.39% From Current Price Level – 10 Day Moving Average*

$496 – Buyers – 3:1, -3.17% From Current Price Level

$492 – Buyers – 17.25:1, -3.95% From Current Price Level

$488 – Buyers – 1.25:1, -4.73% From Current Price Level

$484 – Buyers – 3.5:1, -5.51% From Current Price Level – 50 Day Moving Average*

$480 – Buyers – 1.2:1, -6.3% From Current Price Level

$476 – Sellers – 1.22:1, -7.08% From Current Price Level

$472 – Buyers – 1.68:1, -7.86% From Current Price Level

$468 – Sellers – 2.1:1, -8.64% From Current Price Level

$464 – Buyers – 1.6:0*, -9.42% From Current Price Level

$460 – Buyers – 1.52:1, -10.2% From Current Price Level – 200 Day Moving Average*

$456 – Sellers – 2.06:1, -10.98% From Current Price Level

$452 – Buyers – 1.11:1, -11.76% From Current Price Level

$448 – Sellers – 1.93:1, -12.54% From Current Price Level

$444 – Buyers – 3.8:0*, -13.32% From Current Price Level

$440 – Buyers – 3.08:1, -14.1% From Current Price Level

$436 – Buyers – 1.36:1, -14.89% From Current Price Level

$432 – Sellers – 3.33:1, -15.67% From Current Price Level

$428 – Buyers – 2.09:1, -16.45% From Current Price Level

$424 – Sellers – 1.11:1, -17.23% From Current Price Level

$420 – Sellers – 1.85:1, -18.01% From Current Price Level

$416 – Buyers – 3.1:0*, -18.79% From Current Price Level

$412 – Sellers – 2.7:0*, -19.57% From Current Price Level

$408 – Buyers – 4.4:1, -20.35% From Current Price Level

$404 – Buyers – 2.37:1, -21.13% From Current Price Level

$400 – Sellers – 1.03:1, -21.91% From Current Price Level

$396 – Sellers – 1:0*, -22.69% From Current Price Level

$392 – Buyers – 3.57:1, -23.47% From Current Price Level

$388 – Buyers – 2.8:0*, -24.26% From Current Price Level

$384 – Buyers – 1.14:1, -25.04% From Current Price Level

$380 – Buyers – 2.57:1, -25.82% From Current Price Level

$376 – Buyers – 2.57:1, -26.6% From Current Price Level

$372 – Sellers – 1.03:1, -27.38% From Current Price Level

$368 – Even – 1:1, -28.16% From Current Price Level

$364 – Buyers – 1.22:1, -28.94% From Current Price Level

$360 – Buyers – 1.3:1, -29.72% From Current Price Level

$356 – Sellers – 1.1:1, -30.5% From Current Price Level

$352 – Sellers – 1.07:1, -31.28% From Current Price Level

$348 – Buyers – 3.47:1, -32.06% From Current Price Level

$344 – Sellers – 1.05:1, -32.85% From Current Price Level

$340 – Sellers – 1.15:1, -33.63% From Current Price Level

$336 – Buyers – 1.3:0*, -34.41% From Current Price Level

$332 – Buyers – 1.91:1, -35.19% From Current Price Level

$328 – Sellers – 2.2:0*, -35.97% From Current Price Level

$324 – Buyers – 1.8:0*, -36.75% From Current Price Level

$320 – Buyers – 3.78:1, -37.53% From Current Price Level

$316 – Buyers – 1.38:1, -38.31% From Current Price Level

$312 – Sellers – 1.8:1, -39.09% From Current Price Level

$308 – Buyers – 3.17:1, -39.87% From Current Price Level

$304 – Buyers – 1.93:1, -40.65% From Current Price Level

$300 – Sellers – 1.28:1, -41.43% From Current Price Level

$296 – Sellers – 1.17:1, -42.22% From Current Price Level

$292 – Buyers – 5.42:1, -43% From Current Price Level

$288 – Buyers – 1.3:1, -43.78% From Current Price Level

$284 – Buyers – 1.37:1, -44.56% From Current Price Level

$280 – Sellers – 1.17:1, -45.34% From Current Price Level

$276 – Buyers – 1.16:1, -46.12% From Current Price Level

$272 – Sellers – 1.88:1, -46.9% From Current Price Level

$268 – Buyers – 1.27:1, -47.68% From Current Price Level

$264 – Buyers – 1.68:1, -48.46% From Current Price Level

$260 – Sellers – 1.48:1, -49.24% From Current Price Level

$256 – Sellers – 8.2:0*, -50.02% From Current Price Level

$252 – NULL – 0:0*, -50.81% From Current Price Level

Price Level:Volume Sentiment Analysis For IWM, The iShares Russell 2000 ETF

IWM, the iShares Russell 2000 ETF was the biggest winner of the major four index ETFs over the past week in terms of their post-election gap up.

They enjoy a number of support levels just below the window that was created by that gap which will benefit them in the face of a decline.

Unlike the prior two ETFs, IWM’s recently weekly volumes have been higher when compared to their prior year’s average volume vs. seven months ago when the same comparison was made, indicating that there has been a rotation towards smaller cap names vs. SPY & QQQ components.

Still, this doesn’t make them immune to any drawdowns & it is worth reviewing the tables below to understand how market participants have felt at the price levels they’ve traded at.

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.

$244 – NULL – 0:0*, +2.11% From Current Price Level

$240 – NULL – 0:0*, +0.44% From Current Price Level – All Time High*

$236 – NULL – 0:0*, -1.24% From Current Price Level – Current Price Level*

$232 – NULL – 0:0*, -2.91% From Current Price Level

$228 – NULL – 0:0*, -4.59% From Current Price Level – 10 Day Moving Average*

$224 – Sellers – 2:1, -6.26% From Current Price Level

$220 – Buyers – 2:1,-7.93% From Current Price Level – 50 Day Moving Average*

$216 – Buyers – 1.4:1, -9.61% From Current Price Level

$212 – Sellers – 1.5:1, -11.28% From Current Price Level

$208 – Buyers – 2.5:1, -12.96% From Current Price Level – 200 Day Moving Average*

$204 – Buyers – 2:1, -14.63% From Current Price Level

$200 – Buyers – 1.1:1, -16.3% From Current Price Level

$198 – Sellers – 1.16:1, -17.14% From Current Price Level

$196 – Buyers – 2.14:1, -17.98% From Current Price Level

$194 – Sellers – 1.09:1, -18.81% From Current Price Level

$192 – Sellers – 1.7:1, -19.65% From Current Price Level

$190 – Sellers – 1.66:1, -20.49% From Current Price Level

$188 – Sellers – 1.17:1, -21.33% From Current Price Level

$186 – Buyers – 1.42:1, -22.16% From Current Price Level

$184 – Buyers – 4.33:1, -23% From Current Price Level

$182 – Buyers – 1.11:1, -23.84% From Current Price Level

$180 – Sellers – 1.2:1, -24.67% From Current Price Level

$178 – Sellers – 1.06:1, -25.51% From Current Price Level

$176 – Buyers – 1.23:1, -26.35% From Current Price Level

$174 – Buyers – 1.65:1, -27.18% From Current Price Level

$172 – Buyers – 1.07:1, -28.02% From Current Price Level

$170 – Buyers – 1.28:1, -28.86% From Current Price Level

$168 – Sellers – 2.9:1, -29.7% From Current Price Level

$166 – Sellers – 2.75:1, -30.53% From Current Price Level

$164 – Sellers – 3.25:1, -31.37% From Current Price Level

$162 – Buyers – 3.6:1, -32.21% From Current Price Level

$160 – Sellers – 1.83:1, -33.04% From Current Price Level

Price Level:Volume Sentiment Analysis For DIA, The SPDR Dow Jones Industrial Average ETF

For much of the past year DIA, the SPDR Dow Jones Industrial Average ETF has traded in a more similar, oscillating with steady growth upwards manner than IWM, vs. the more rapid ascents of SPY & QQQ.

While they do not share as many local support levels as IWM, the resiliency of the blue chip DIA index shows that there are plenty of places for it to find footing in the face of a decline.

Investors have continued to buy into the blue chip names forcing DIA higher, which will be interesting to see the reactions to in the event of some type of sell-off in the near-future.

For now though, it is important to understand where the Buyers have met the Sellers over the past few years & in what capacity in order to formulate how strong support levels may be in the event of declines.

$448 – NULL – 0:0*, +1.76% From Current Price Level

$444 – NULL – 0:0*, +0.85% From Current Price Level – All-Time High*

$440 – NULL – 0:0*, +0.85% From Current Price Level – Current Price Level*

$436 – NUL – 0:0*, -0.06% From Current Price Level

$432 – Buyers – 0.6:0*, -0.97% From Current Price Level

$428 – Buyers – 1.4:1, -1.88% From Current Price Level – 10 Day Moving Average*

$424 – Sellers – 1.67:1, -2.78% From Current Price Level

$420 – Buyers – 3.2:1, -3.69% From Current Price Level – 50 Day Moving Average*

$416 – Sellers – 7:1, -4.6% From Current Price Level

$412 – Buyers – 3:1, -5.51% From Current Price Level

$408 – Buyers – 9:1, -6.42% From Current Price Level

$404 – Buyers – 3:1, -7.33% From Current Price Level

$400 – Sellers – 2.33:1, -9.14% From Current Price Level

$396 – Buyers – 1:0*, -10.05% From Current Price Level – 200 Day Moving Average*

$392 – Buyers – 3.2:1, -10.96% From Current Price Level

$388 – Sellers – 1.14:1, -11.87% From Current Price Level

$384 – Buyers – 1.27:1, -12.78% From Current Price Level

$380 – Even – 1:1, -13.69% From Current Price Level

$376 – Buyers – 1.18:1, -14.6% From Current Price Level

$372 – Buyers – 2.25:1, -15.5% From Current Price Level

$368 – Buyers – 1.7:1, -16.41% From Current Price Level

$364 – Buyers – 2.67:1, -17.32% From Current Price Level

$360 – Buyers – 0.1:0*, -18.23% From Current Price Level

$356 – Buyers – 2.67:1, -19.14% From Current Price Level

$352 – Sellers – 2:1, -20.05% From Current Price Level

$348 – Buyers – 0.7:0*, -20.96% From Current Price Level

$344 – Buyers – 1.93:1, -21.86% From Current Price Level

$340 – Sellers – 1.23:1, -22.77% From Current Price Level

$336 – Buyers – 2.8:1, -23.68% From Current Price Level

$332 – Buyers – 1.15:1, -24.59% From Current Price Level

$328 – Buyers – 1.14:1, -25.5% From Current Price Level

$324 – Sellers – 1.03:1, -26.41% From Current Price Level

$320 – Sellers – 1.15:1, -27.32% From Current Price Level

$316 – Sellers – 1.12:1, -28.22% From Current Price Level

$312 – Sellers – 1.52:1, -29.13% From Current Price Level

$308 – Sellers – 1.44:1, -30.04% From Current Price Level

$304 – Buyers – 1.58:1, -30.95% From Current Price Level

$300 – Sellers – 1.64:1, -31.86% From Current Price Level

$296 – Buyers – 1.27:1, -32.77% From Current Price Level

$292 – Buyers – 1.15:1, -33.68% From Current Price Level

$288 – Sellers – 1.53:1, -34.58% From Current Price Level

$284 – Buyers – 1.2:1, -35.49% From Current Price Level

$280 – Even – 1:1, -36.4% From Current Price Level

$276 – Sellers – 1.2:1, -37.31% From Current Price Level

$272 – Buyers – 2.33:1, -38.22% From Current Price Level

$268 – Buyers – 3:1, -39.13% From Current Price Level

$264 – Buyers – 0.2:0*, -40.04% From Current Price Level

$260 – Sellers – 0.1:0*, -40.94% From Current Price Level

$256 – Buyers – 0.3:0*, -41.85% From Current Price Level

$252 – Buyers – 0.2:0*, -42.76% From Current Price Level

$248 – Buyers – 0.2:0*, -43.67% From Current Price Level

$244 – NULL – 0:0*, -44.58% From Current Price Level

*** 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 +4.75% last week, while the VIX closed the week at 14.94, indicating an implied one day move of +/-0.94% & an implied one month move of +/-4.32% for the S&P 500.

Their RSI is trending into overbought territory in the wake of last week’s performance & currently sits just below it at 69.23, while their MACD crossed over bullishly on Thursday morning.

Volumes were still extremely light though, coming in -21.85% below the prior year’s average (47,910,000 vs. 61,308,656), which as we’ve highlighted in prior weeks’ notes is down drastically from even just seven month’s ago’s prior year’s average volume.

While there was some enthusiasm as a result of the US Presidential election & the FOMC Interest Rate decision the participation rate is still low following mid-April.

Last week opened on a note of uncertainty, as the session’s candle stayed within the range of the previous Thursday’s candle & the support of the 50 day moving average held up, although volumes were light.

Tuesday the low volume continued, but the session resulted in an advance that closed in line with the resistance of the 10 day moving average as folks anxiously awaited the results of the US election.

Wednesday saw enthusiasm rush through the markets, as the highest volume of the week led to a 2.5% gap up for SPY that opened well above the 10 day moving average’s resistance, but it came with a note of caution.

The day’s candle resulted in a hanging man, which has bearish implications & signals that there was a bit of downside appetite despite the day’s higher close.

The good times rolled on into the weekend when Thursday opened on another gap up session higher & Friday produced a +0.43% gain.

Friday’s candle offered another glimmer of caution as well, as while the upper shadow on the day’s candle is not long enough for the candle to be a shooting star, the day’s open & close were concentrated on the lower end of the candle.

Heading into the new week it will be interesting to see if there is enough momentum to continue SPY’s climb higher, or if there will be a cool off period.

Their MACD suggests that there may still be some fuel in the tank to the upside, but their RSI is nearing the overbought level, which is something investors should be mindful of in the days to come.

Another key area of interest will be how price behaves in regards to the window that was created by Wednesday’s gap up.

Due to the fact that we’re near all-time highs there is not enough volume sentiment data to assess the strength of the nearby support levels for SPY, as the $586.12 & 10 day moving average at $581.36 both fall within the window.

In the event it begins to fill then the strength of the 50 DMA’s support will be something else to keep an eye on to see if it can provide stable enough footing for SPY to consolidate & broaden.

SPY has support at the $586.12 (Volume Sentiment: NULL, 0:0*), $581.36 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $570.82 (50 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $567.89/share (Volume Sentiment: NULL, 0:0*) price levels, with resistance at the $599.64/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 climbed +5.48% last week, as investors were eager to get into the tech focused index.

Their RSI has flattened out after advancing towards the overbought level & currently sits at 67.6, while their MACD crossed over bullishly on Thursday.

Volumes were -25.25% below the previous year’s average volume (29,298,000 vs. 39,196,719), indicating that there is still a severe lack of participation much like SPY.

SPY & QQQ have both benefitted dramatically from the AI/Data Center/Semiconductor trades of the past couple of years & it now appears as though investors are pivoting away in favor of the small cap names in IWM & the blue chip index of DIA.

Accordingly, QQQ’s week went very similar to SPY’s, starting off on an uncertain note Monday when the session resulted in a slight decline & a high wave spinning top candle that formed a bearish harami pattern with the day prior’s candle on low volume.

The next day opened in a gap up & ran up to test the resistance of the 10 day moving average, which was briefly broken but was unable to close above it.

Wednesday opened on a large gap up & the session continued higher, setting a new all-time high & closing above the $505/share price level on the highest volume of the week as investors were excited about the results of the election.

Thursday followed suit with another gap up day & all-time high as market participants were still pleased by Wednesday’s news.

Friday the week wound down on another high note, but the day’s candle did flash signal for caution ahead.

Friday’s candle opened lower than Thursday’s close but was able to push slightly higher, adding +0.12% for the day & setting a new all-time high, but it appears that the $514.92/share level is where investors lost enthusiasm & may signal the top in the near-term.

Entering this week it will be interesting to see if there are some profits taken which would push prices down to begin filling in the gaps of last week.

QQQ has more local support than SPY did that may help keep prices propped up & from declining too low below the window, but that will be heavily dependent on how much volume we see on declining days.

The $502.81 & $501.35/share points will be interesting to follow, as they were only broken through on account of gaps, which could make for a false breakout based on the low volume levels.

Any decline will be worth keeping an eye on as well to see if the 10 & 50 DMAs hold up, especially now that the 200 DMA sits just -7.64% below the 10 DMA & -5.16% below the 50 DMA.

Prices tested against the 200 DMA in August & were able to rebound & climb higher, but the appetite to dip below it has already been shown once in the past year & can’t be ruled out again.

QQQ has support at the $502.81 (Volume Sentiment: Buyers, 0.6:0*), $501.35 (Volume Sentiment: Buyers, 0.6:0*), $497.47 (Volume Sentiment: Buyers, 2.4:0*) & $493.70/share (Volume Sentiment: Buyers, 0.7:0*) price levels, with resistance at the $514.92/share (Volume Sentiment: NULL, 0:0*) price levels.

IWM, the iShares Russell 2000 ETF advanced +8.74% last week, as market participants flocked into small cap names in droves.

Their RSI has also flattened out, but in overbought territory & sits at 72.78, while their MACD crossed over bullishly on Wednesday.

Volumes were +9.69% above the previous year’s average levels (36,796,000 vs. 33,544,150), as investors were eager to get into small cap names following the US election & FOMC Interest Rate decision.

IWM’s week began on an interesting note, opening lower than Friday’s close, testing to below the support of the 50 DMA before breaking out upwards & crossing the resistance of the 10 DMA briefly before closing in-line with it.

Tuesday opened slightly lower before taking off running through the resistance of the 10 DMA & closing firmly above it.

IWM had a phenomenal Wednesday which accounted for +5.8% of the week’s gains as IWM gapped up, tested down to near the $232.50/share level before roaring back on high volume to close the session higher.

It should be noted that the day resulted in a hanging man candle which carries bearish implications with it, as despite the day’s gain there showed to be plenty of appetite for prices to head to the downside as well.

Despite most of it likely coming from profit taking after the gap, it is still something to consider moving forward, particularly if IWM is unable to continue higher as it will then give a rough idea as to the near-term range it may trade in.

Thursday flashed more warning signs for IWM though, as the session opened lower, tested higher to hit a new all-time high, before collapsing down to near the $235/share mark & settling down for the day.

While Friday’s +0.74% gain created a bullish engulfing candle, the volume sentiment behind it was severely lackluster & does not show much strength & conviction behind the move.

This coming week will be important to track the direction of volume to assess whether or not the current island that was set up last week will be sustainable & if not, how far the declines may be.

The $227-227.85/share level will be the first line of defense for IWM in terms of support, unless the 10 DMA moves higher in the meantime before those levels are tested.

In the event of a breakdown, IWM has many more local support levels than SPY or QQQ due to the rangebound oscillations it advances in vs. the latter two indexes more steep ascents & rapid growth.

IWM has support at the $227.85 (Volume Sentiment: Buyers, 1.6:0*), $227.17 (Volume Sentiment: Buyers, 1.6:0*), $225.87 (Volume Sentiment: Buyers, 1.6:0*) & $225.84/share (10 Day Moving Average, Volume Sentiment: Buyers, 1.6:0*) price levels, with resistance at the $238.49/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

DIA, the SPDR Dow Jones Industrial Average ETF jumped +4.68% last week, as investors wanted exposure to the blue chip index following the week in news.

Their RSI is trending towards overbought levels & is currently at 68.36, while their MACD crossed over bullishly on Thursday.

Volumes were +31.68% above the previous year’s average (4,554,000 vs. 3,458,379), as investors showed that they clearly were seeking the protection of the blue chip names while at all-time highs.

Monday opened the week up the same as SPY & QQQ with a declining day where DIA opened lower, briefly tested higher before plunging through its 50 DMA’s support & recovered to close just below it.

Volumes were weak, a trend that continued into Tuesday when the session opened higher & powered above both the 50 & 10 DMA’s resistance levels to close above each, but again, on weak volume.

Wednesday saw a +3.5% advance on the heaviest volume of the week as DIA opened on a gap up & little profit taking took place based on the size of the lower shadow of the session’s candle.

Thursday’s price action began to show some doubt in the strength of the new all-time high set on Wednesday, as though the session advanced on solid volume, it closed lower than it opened & had a very narrow range (between a spinning top & a doji, but not entirely one or the other) between the day’s open & close.

This indicates that there was enough fuel to keep active participation going, but that there was not much appetite to take things higher & that market participants felt like they were at equilibrium.

Friday the gains continued with DIA advancing +0.62% on the day on the second highest volume of the week, but the size of the upper shadow on the day’s candle is cause for concern.

Bears clearly took the reigns back at $441.70 & forced the price back down to $440.11 & following the message of the prior day’s candle it appears that investors might be nearing the end of their rope on the near-term upside for DIA.

Much like the prior three index ETFs, this week all eyes will be on the window created Wednesday & whether or not it gets filled in the near-term.

Whether the above average volume continues for DIA will also be something to be aware of this coming week, as should it begin to falter there will likely be some risk-off movements by market participants that would force a test of the support of the 10 & possibly 50 DMAs.

Otherwise, in the event of decline the $426-426.50 level will be a zone to keep an eye on for support, as there is currently not much volume data about these price levels to gauge historic sentiment yet.

DIA has support at the $443.20 (Volume Sentiment: NULL, 0:0*), $426.15 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $426.05 (Volume Sentiment: NULL, 0:0*) & $421.09/share (50 Day Moving Average, Volume Sentiment: NULL, 0:0*) price levels, with resistance at the $441.70/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Monday is Veteran’s Day & the bond market will be closed.

Aramark & Monday.com report earnings on Monday morning before the opening bell, followed by Archrock, Assured Guaranty, James River Group, Kyverna Therapuetics, Luminar Technologies, Nevro, Talos Energy & Zeta Global after the session’s close.

Tuesday brings us NFIB Optimism Index data at 6am.

Home Depot kicks off Tuesday morning’s earnings calls, along with Alight, Alumis, AstraZeneca, Avadel Pharmaceuticals, Camtek, Endava, EVgo Inc., First Advantage, Genius Sports, Hertz Global, Hudbay Minerals, HUYA, IAC Inc., IHS Holding Limited, International Game Technology, Legend Biotech, Live Nation, Mirum Pharmaceuticals, Mosaic, Neumora Therapeutics, Northwest Natural, Novavax, On Holding, Pactiv Evergreen, Pagaya, Piedmont Lithium, Plug Power, Repligen, Roivant Sciences, Scholar Rock, Schrodinger, Sea Limited, Shift4 Payments, Shoals Technologies, Smith Douglas Homes, Sphere Entertainment, SpringWorks Therapeutics, Sunstone Hotel, Surgery Partners, Sylvamo, Target Hospitality, Tencent Music, TreeHouse Foods, Triumph Group & Tyson Foods, followed by Amdocs, American Healthcare REIT, Azenta, CAE, Cannae Holdings, CAVA Group, Chegg, Crinetics Pharmaceuticals, DHT, EverCommerce, Grab, Hudson Pacific Properties, ICU Medical, Instacart, Integral Ad Science, Light & Wonder, MARA Holdings, Natera, NCR Atleos, NeuroPace, Occidental Petroleum, OUTFRONT Media, Paragon 28, Paymentus, Perdoceo Education, Progyny, Prothena, PubMatic, Rackspace Technology, Repay Holdings, Rocket Lab USA, Seadrill Ltd, Skyworks Solutions, SoundHound AI, Spotify, Suncor Energy, TechTarget, Topgolf Callaway Brands, Xenon Pharmaceuticals & ZoomInfo after the closing bell.

Consumer Price Index, CPI Year-over-Year, Core CPI & Core CPI Year-over-Year data is all due for release Wednesday at 8:30 am, followed by the Monthly U.S. Federal Budget data at 2pm.

Wednesday morning’s earnings reports include Advanced Flower Capital, Arcos Dorados, CG Oncology, Curbline Properties, CyberArk Software, Dole, Enlight Renewable Energy, Griffon, Inhibrx Biosciences, James Hardie, Loar Holdings, Paysafe, Riskified, Shopify, Stratasys, Tower Semiconductor & UBS, with Cisco Systems, Beazer Homes, BrightView, Digi International, dLocal, Helmerich & Payne, Hillenbrand, Ibotta, J&J Snack Foods, Kulicke & Soffa, Nuvei, PACS Group, Sonos & Tetra Tech reporting after the closing bell.

Thursday brings us Initial Jobless Claims, Producer Price Index, PPI Year-over-Year, Core PPI & Core PPI Year-over-Year data at 8:30 am.

Walt Disney, Advance Auto Parts, Bilibili, JD.com, NetEase, NICE, Nomad Foods, Sally Beauty, Sally Beauty & ZEEKR Intelligent Technology Holding are all due to report earnings on Thursday morning before Applied Materials, ESCO Technologies, Globant, Mitek Systems & Post report after the session’s close.

Import Price Index, Import Price Index minus Fuel, Empire State Manufacturing Survey, U.S. Retail Sales & Retail Sales minus Autos data are all scheduled for release on Friday at 8:30 am, followed by Industrial Production, & Capacity Utilization data at 9:15 am & Business Inventories data at 10 am.

Friday morning’s major earnings call is Alibaba Group Holding.

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 ***

SPY, the SPDR S&P 500 ETF dipped -0.95% this week, while the VIX closed at 20.33, indicating an implied one day move of +/-1.28% & an implied one month move of +/-5.88% for the S&P 500.

Their RSI has flattened out just above the neutral 50 level & sits at 56.86, while their MACD crossed over bearishly on Wednesday.

Volumes were -35.77% below the previous year’s average (40,436,000 vs. 62,957,183), as investors continue to sit on edge waiting to see what mega cap tech earnings & PCE/inflation data tell us this week.

Monday the week began on a sour note, as the session’s candle resulted in a dragonfly doji that tested the support of the 10 day moving average.

While support held up, volumes were even lower than last week’s, indicating that there was still a good deal of fear & uncertainty about SPY’s outlook for the week.

This continued into Tuesday, where on the lowest volume of the week SPY opened in line with the prior day’s close, only to continue lower throughout the day & settle rested atop the support of the 10 DMA.

Wednesday the 10 DMA’s support broke down, as the session opened below it, tested briefly above it only to fall & close lower, with a large lower shadow signaling that there was still more downside appetite among market participants, but that the bulls had temporarily forced a stronger close.

Thursday saw a glimmer of optimism, as another dragonfly doji candle occurred while SPY tried to claw back some of Wednesday’s losses, but note that the volume was extremely weak on Thursday, which does not indicate that there was much bullish sentiment behind they day’s move.

Thursday’s candle could be considered a bullish harami, but based on the low volume sentiment behind the session & the lower close than open it should be viewed bearishly.

One area of hope from Thursday’s session was that the low of the day was not as low as Wednesday’s, but this is nothing to hitch your wagon to just yet.

Friday managed to open higher, but still below the 10 DMA’s resistance, break temporarily above the resistance level, before ultimately closing near the low of they day -0.03% on the second highest volume of the week.

This “risk-off” into the weekend did not set the stage for an enthusiastic new week & indicates that there is still a bit of skepticism among market participants about the current strength of the S&P 500.

As we look to the coming week the 10 day moving average’s relationship to SPY’s share price remains one of the most important areas to keep an eye on this week.

Support gave out & resistance held strong in the latter half of the week, which will remain important in determining the direction SPY goes in heading into the latter portion of the week.

If the price stays below the 10 DMA’s resistance for too long market participants will become exhausted & impatient likely leading to some selling pressure forcing SPY’s price lower.

This is especially true if there is not a meaningful increase in volume, as the current tumbleweed low levels are unsustainable in the long run if SPY’s valuation is to remain justified near all-time highs.

The direction that volume increases in & the magnitude of the increase will also remain important to watch, as it will shed light into which way market participants are likely to continue moving in once a trend has been established.

Watching how investors are participating will help you to anticipate which direction things will move in in the short-to-medium term.

Something else of note for this week is that now that SPY’s price is below the 10 DMA, the first support level (S1) is their 50 DMA, which is continuing to rise.

Looking at their past year’s chart (above) you can see that more often than not in the past year when the price has gone between these two moving averages there has often been declines, many of which have been able to break down & test the 50 DMA’s support (and two in particular that broke down through it entirely).

This leads to something else that has begun emerging from SPY’s chart over the past week, the appearance of a potential bearish head & shoulders set up forming.

Look back to 9/19/2024’s gap up session & note that the left shoulder forming, with the recent all-time high as the head & the right shoulder yet to form.

Should the moving averages observation above hold true that will begin the formation of the right hand shoulder over a 5-6 week period (assuming a more rapid decline doesn’t take place instead).

The low volume of the past couple of weeks has made this become even more of a possibility as there is no fuel in SPYs tank & looking at their MACD & RSIs it begins to look even more strongly a possibility.

SPY has support at the $566.02 (50 Day Moving Average, Volume Sentiment: NULL, 0:0*), $563.43 (Volume Sentiment: Buyers, 10:1), $562.48 (Volume Sentiment: Buyers, 10:1) & $553.17/share (Volume Sentiment: Buyers, 1.92:1) price levels, with resistance at the $581.66 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $586.12/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF advanced +0.17% last week, faring the best of the major four index ETFs.

Their RSI is trending towards the overbought level of 70 & currently sits at 58.85, while their MACD crossed over bearishly last week.

Volumes were -21.75% below the previous year’s average level (31,432,000 vs. 40,167,659), which as noted in last week’s market review note is severely low in relation to the volumes that QQQ (and the other index ETFs sans-IWM) had previously enjoyed in years past.

QQQ had a different week from SPY, but still did not have a strong performance as investors have begun to sour on the two indexes in favor of IWM & DIA recently.

QQQ opened the week on a quite uncertain note, where mediocre volume resulted in a bullish engulfing candle that resulted in a spinning top.

They briefly broke down through the 10 day moving average’s support during the day, but managed to power higher to close the day higher.

The weak volume & temporary support break down are cause for concern though, which QQQ showed on Tuesday.

While at first glance Tuesday was another bullish engulfing candle & it did not close with the same “indecision” surrounding it that Monday’s spinning top indicated, it should be noted that the volume was weak & that the session opened below the resistance of the 10 DMA.

The fact that the support level was feeble enough to be broken through before the market opened is not indicative of strength & conviction behind QQQ, which was proven with Wednesday’s declining session.

While prices were able to briefly break above the 10 DMA’s resistance, they spent most of the session below it & Wednesday’s volume was the strongest of the week, which is telling about the lack of investor confidence in QQQ as there has not been any major run up to trim profits from & volume hadn’t been that high since 10/1/2024 (also declining volume).

The session’s lower shadow also signals that there was more downside appetite.

Thursday showed the weakest volume of the week for QQQ on a session that closed in a dragonfly doji, indicating indecision, particularly as the 10 DMA was not crossed.

It created a harami cross pattern with Wednesday’s session, which led to Friday’s gap up open that skipped right over the 10 DMA’s resistance.

Friday’s move came on the second highest volume of the week, indicating that there was some support behind it from market participants, however it closed as a gravestone doji, indicating that the bears were still out in full force & likely signaling that there was some intra-day profit taking after the gap up, based on the height of the upper shadow.

QQQ’s week ahead will also be heavily dependent on how the price is in relation to their 10 DMA, which closed Friday as their second level of support (S2).

In the event that prices make a break lower & get pinned between the 10 & 50 DMAs there is additional local support to help prop prices up, but the curve of the 10 DMA should be cause for concern.

Once the 10 DMA curls over as much as it has recently it has led to lower prices in the coming sessions that come in the form of steeper declines vs. consolidation.

When referencing the volume sentiment by price level table below you’ll notice that this may well lead to a 5%+ decline based on the Buyer:Seller sentiment at these levels over the past ~2 years.

While this week’s earnings calls may be enough of a catalyst to forge higher for QQQ, they too are showing signs of a bearish head & shoulders pattern emerging over a similar time period as SPY’s.

Friday’s high would become the head (assuming nothing in the days to come is higher than it), giving it 4-6 weeks until the right shoulder is formed (in the event that it does not decline more rapidly).

In the event of an earnings catalyst this week, it will be imperative to see how the $502.81 resistance level holds up, as in the event that it is broken through the landscape for QQQ will change (pending on how their oscillators react to the jump).

While QQQ has shown higher peaks & higher troughs since the declines of July, the lackluster participation rate being signaled by their current volume levels raises cause for concern still moving into the week ahead & like SPY, watching their the direction & fluctuations that their volume goes in will lend tells into where they head next.

QQQ has support at the $493.70 (Volume Sentiment: Buyers, 0.7:0*), $493.24 (Volume Sentiment: Buyers, 0.7:0*), $484.86 (Volume Sentiment: Buyers, 1.6:0*) & $480.15/share (50 Day Moving Average, Volume Sentiment: Buyers, 1.4:1) price levels, with resistance at $493.70/share (All-Time High, Volume Sentiment: Buyers, 0.7:0*) price levels.

IWM, the iShares Russell 2000 ETF declined -3% last week, as investors shunned the small cap heavy index.

Their RSI recently crossed below the neutral mark of 50 & sits currently at 47.86, while their MACD has been bearish since Wednesday.

Volumes were -38.02% below the prior years average (21,100,000 vs. 34,043,929), which is peculiar, given that the Russell has fared the best of the major four indexes in terms of volume since 4/19/2024 & is something to consider in any analysis of the small cap index.

After rounding the prior week out with a couple of bad sessions the pain continued into the new week for IWM, as the session opened lower & proceeded to decline -1.74% & meeting the support of the 10 day moving average (briefly breaking down below it) on some of the highest volume of the week.

While some may attribute this to profit taking, it seems a bit lopsided compared to the volumes of the week & a half prior’s run up & should be viewed with a skeptical eye.

Tuesday the ship continued to sink, as the session opened on a gap down beneath the 10 day moving average’s support & closed as a hanging man candle (bearish).

Volume was noticeably weaker than the previous day’s, however the emphasis here should be placed on the fact that the session opened up with all faith in the 10 DMAs support level obliterated.

Wednesday followed suit, opening on a gap down again & despite showing some bulls had entered the chat (upper shadow) the bears were still in control, forcing the session to almost test the support of the 50 day moving average beneath it.

Bulls were able to rush in & force the close to be in the top ~33% of the day’s range though, and there was a lot of shares trading hands compared to most of the rest of October based on their “high” volume.

The dim outlook continued into Thursday, when the session opened higher, tested higher & then proceeded to retrace over 50% of the prior day’s range & ultimately closed below its opening price, indicating weakness & poor spirits among market participants given the low volume of the day.

Friday the bandaid was ton off, as a high volume for the week session resulted in a bearish engulfing candle that sat almost perfectly between the resistance of the 10 DMA & support of the 50 DMA.

Every part of Friday’s candle eclipsed Thursday’s, leading to the oscillator readings mentioned above & the curling over of their 10 day moving average’s resistance which looks set to apply downward pressure on IWM’s price.

While we’ve noted in past weeks that IWM’s volume has not taken as big of a hit as the other major three index ETFs, volume & the direction it occurs in will still be very telling about the next direction IWM takes in the coming weeks & should be paid close attention to.

Much like SPY & QQQ, the relationship between price & the 10 & 50 day moving averages will be important to note as well, especially as they’re both also signaling a potential near-term head & shoulders pattern whose left shoulder formed in mid-September.

Another thing of note regarding IWM’s 50 DMA’s support is that should it break down, there are no other touch-points until $210.57/share & the 50 DMA is in s Seller dominated price block (3.3:1).

While the $208 support zone has been dominated by the Buyers 2:1 in recent history & the $210.57/share point is contained in this price block, it may not be the sturdiest of support & should be viewed with caution.

IWM has support at the $217.50 (50 Day Moving Average, Volume Sentiment: Sellers, 3.3:1), $210.57 (Volume Sentiment: Buyers, 2:1), $208.58 (Volume Sentiment: Buyers, 2:1) & $208.47/share (Volume Sentiment: Buyers, 2:1) price levels, with resistance at the $221.69 (Volume Sentiment: Buyers, 2.86:1), $222.57 (10 Day Moving Average, Volume Sentiment: Buyers, 2.86:1), $222.17 (Volume Sentiment: Buyers, 2.86:1) & $227.85/share (Volume Sentiment: Buyers, 1.6:0*) price levels.

DIA, the SPDR Dow Jones Industrial Average ETF fell -2.66% last week, as blue chip names were not in favor vs. the tech heavy NASDAQ.

Their RSI also just crossed through the neutral 50 mark & sits currently at 46.31, while their MACD has also been bearish since Wednesday.

Volumes were -22.17% below the previous year’s average (2,696,000 vs. 3,464,048), as investors are even skittish on buying into the blue chip index so close to all-time highs.

The week began & ended on a weak note for DIA following a new all-time high hit on Friday & a pair or dragonfly doji candles closing out the week before.

Monday’s bearish engulfing candle set the stage for a week of pain for DIA, as it started the week off with a test of the support of the 10 day moving average.

While it didn’t break down the support level on Monday, Tuesday gapped lower on the open before turning upwards & closing near in-line with the 10 DMA’s resistance, after briefly breaking through it (upper shadow).

Wednesday the pain got worse, when the week’s highest volume session began with a gap down that ultimately tested -0.96% lower than its opening price during the session, despite bulls managing to step in & for the close to be about midway between the day’s range.

Thursday the sad song continued for DIA, as it opened on a gap lower & closed as a hanging man candle (bearish).

Friday the trend remained alive & well, as the session declined -0.62% on a bearish engulfing candle, setting this week up for more bearish performance from the looks of things.

DIA also has the same head & shoulders pattern appearing from mid-September as SPY, QQQ & IWM have & their oscillators & moving averages are also beginning to show this forming.

Keep an eye on their volume in the coming weeks, particularly which direction it appears to be moving in as that will lead prices.

Like the three aforementioned ETFs, the coming week will also be marked by where DIA’s price winds up in relation to their 10 & 50 DMAs, which as you can see looking at their chart will likely be what causes the H&S pattern to form based on the current layout.

DIA has support at the $418.12 (Volume Sentiment: Buyers, 0.2:0*), $417.66 (Volume Sentiment: Buyers, 0.2:0*), $415.17 (Volume Sentiment: Buyers, 0.8:0*) & $411.96/share (Volume Sentiment: Buyers, 3.4:1) price levels, with resistance at the $426.05 (Volume Sentiment: NULL, 0:0*), $428.24 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $433.20/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Monday there are no major U.S. Economic Data Reports or Fed Speakers.

Acadia Realty Trust, Bank of Hawaii, CenterPoint Energy, Hope Bancorp, ON Semiconductor, PROCEPT BioRobotics & SJW all report earnings before Monday’s opening bell, followed by Agilysys, Amkor, Atlas Energy Solutions, Boot Barn Holdings, Brixmor Property, Brown & Brown, Cadence Design, Calix Networks, Camping World, Capital Southwest, CCC Intelligent Solutions, COPT Defense Properties, Crane, CVR Energy, Douglas Dynamics, Element Solutions, Encompass Health, F5 Networks, Flowserve, Ford Motor, Harmonic, Inari, Kforce, Kilroy Realty, Leggett & Platt, LTC Properties, NorthWestern, PotlatchDeltic, Rambus, Regency Centers, Safehold, SBA Communications, Skyline Champion, TransMedics Group, Trex, UFP Industries, Ultra Clean Holdings, V.F. Corp, Waste Management & Welltower after the session’s close.

S&P Case-Shiller Home Price Index (20 Cities) data comes out at 9 am on Tuesday, followed by Consumer Confidence & Job Openings Data at 10 am.

Tuesday kicks off with earnings from American Tower, Armstrong World Industries, Asbury Automotive, ATI Inc., CBIZ, CECO Environmental, Check Point Software, Comcast, Commvault Systems, Corning, CTS Corp, D.R. Horton, DT Midstream, Eagle Materials, Ecolab, Enterprise Products, ESAB Corp., Franklin Electric, Frontier Group Holdings, Graphic Packaging, H&E Equipment, Harmony Biosciences, Hayward Holdings, HNI, Hubbell, Incyte, IPG Photonics, ITT, Janus International Group, JetBlue Airways, Kiniksa Pharmaceuticals, Leidos, Masco, McDonald’s, MSCI, Northwest Bancshares, PayPal Holdings, Pfizer, Phillips 66, PJT Partners, Royal Caribbean, Scorpio Tankers, Shutterstock, SoFi Technologies, Stanley Black & Decker, Sysco, Tenet Healthcare, Xerox & Zebra Technologies, with 10x Genomics, Adtalem Global Education, Advanced Micro Devices, Alignment Healthcare, Allison Transmission, Alphabet, American Homes 4 Rent, Artisan Partners Asset Management, BioMarin Pharmaceutical, BXP, Caesars Entertainment, Cheesecake Factory, Chemed, Chipotle Mexican Grill, Chubb, DaVita, Edison International, Electronic Arts, Enovix, EQT Corp., Essex Property, Exelixis, ExlService, Expand Energy, Extra Space Storage, First Commonwealth, First Solar, FirstEnergy, FMC Corp, Huron Consulting, IDEX Corp, Ingevity, Landstar System, Littelfuse, Meritage Homes, Mirion Technologies, Modine Manufacturing, Mondelez International, NerdWallet, O-I Glass, ONEOK, Park Hotels & Resorts, PROS Holdings, Provident Financial Services, Qorvo, Reddit, Republic Services, SAGE Therapeutics, Skyward Specialty Insurance Group, Snap, STAG Industrial, Stryker, Udemy, UMB Financial Corp, Unisys, Unum Group, Varonis Systems, Visa, W.P. Carey, Werner Enterprises & Zurn Elkay Water Solutions scheduled to report after the closing bell.

Wednesday kicks off with ADP Employment data at 8:15 am, with GDP, Advanced U.S. Trade Balance in Goods, Advanced Retail Inventories & Advanced Wholesale Inventories data at 8:30 am.

AbbVie, AerCap, AFC Gamma, Allete, Ares Capital, Arvinas, Automatic Data Processing, Avanos Medical, Avnet, Axalta Coating Systems, Bausch + Lomb, Bausch Health, Biogen, Blackbaud, Brinker International, Bunge, Caterpillar, CDW, Chefs’ Warehouse, Clean Harbors, Clearway Energy, Columbus McKinnon, Curbline Properties, Dana, Eli Lilly, Exelon, Extreme Networks, Fiverr, Flex, Fortive, Garmin, Gates Industrial, GE HealthCare, Gentherm, Gibraltar Industries, GlaxoSmithKline, Global Payments, Group 1 Auto, Healthcare Realty, Hess, Hess Midstream Partners, Humana, Illinois Tool Works, IMAX, InMode, Intra-Cellular Therapies, JinkoSolar, Kirby, Kraft Heinz, Leonardo DRS, LivaNova, Martin Marietta, Materion, Monro Muffler, Navient, Neurocrine Biosciences, NiSource, NovoCure, Oil States, Omnicell, OneMain Holdings, OneSpaWorld, Option Care Health, Oshkosh, Otis Worldwide, Parsons, ProPetro, Reynolds Consumer Products, Shake Shack, Silgan Holdings, SiteOne Landscape Supply, Stepan, Terex, The Vita Coco Company, Tradeweb Markets, Trane, TTM Technologies, United Therapeutics, Verisk Analytics, Vulcan Materials, Wingstop, XPO & Zimmer Biomet are all scheduled to report earnings before Wednesday’s opening bell, followed by Meta Platforms, Acadia Healthcare, Advanced Energy, Aflac, Albany International, Alkami Technology, Allegiant Travel, Allstate, Alphatec, Altair Engineering, American Water Works, Amgen, Antero Midstream, Antero Resources, Arch Capital, Arcosa, AXIS Capital, Axos Financial, Beacon Roofing Supply, Benchmark Electronics, Bio-Rad Labs, Booking Holdings, C.H. Robinson, Cactus, Carvana, Casella Waste, CF Industries, Clorox, Cognex, Cognizant Technology Solutions, Coinbase Global, Columbia Sportswear, Compass Diversified, Comstock, Confluent, CONMED, Corcept Therapeutics, Credit Acceptance, Curtiss-Wright, Custom Truck One Source, DoorDash, eBay, Employers Holdings, Energy Recovery, Envista, EPR Properties, Equinix, Equity Residential, Ethan Allen, Etsy, Everest Group, Federal Realty, Floor & Decor, FormFactor, Four Corners Property Trust, FTAI Aviation, Gen Digital, GoDaddy, Green Brick Partners, Hanover Insurance, Herbalife Nutrition, Hercules Capital, Houlihan Lokey, Hub Group, Independence Realty Trust, Informatica, Invitation Homes, iRhythm, KLA Corporation, Lemonade, LPL Financial, Magnolia Oil & Gas, Manitowoc, Matson, MediaAlpha, Merit Medical, MetLife, MGM Resorts, Microsoft, MicroStrategy, Mid-America Apartment Communities, Mister Car Wash, Monolithic Power, Murphy USA, MYR Group, National Storage Affiliates, NETGEAR, New Mountain Finance, Nextracker, NV5 Global, Omega Health, Paramount Group, Paycom Software, Paylocity, Penumbra, Pilgrim’s Pride, PriceSmart, Procore Technologies, Prudential, Public Storage, Remitly Global, Riot Platforms, Robinhood Markets, Roku, Root, Inc., Rush Enterprises, Rush Street Interactive, Ryan Specialty Group, Silicon Motion, Sleep Number, Sprouts Farmers Market, SPX Technologies, STAAR Surgical, Starbucks, Stem, Sturm Ruger, Summit Materials, Sunnova Energy, Teekay Tankers, Teladoc, Tenable, Trupanion, Twilio, UDR, Universal Display, Ventas, Warrior Met Coal, Watts Water Technologies & WillScot Mobile Mini after the closing bell.

Personal Income, Personal Spending, PCE Index, PCE (Year-over-Year), Core PCE Index, Core PCE (Year-over-Year) & Initial Jobless Claims data are all released Thursday morning at 8:30 am, followed by Pending Home Sales data at 10 am.

Thursday morning’s earnings calls include 1-800-FLOWERS, Agios Pharmaceuticals, Allegro Microsystems, Alnylam Pharma, Altria, Alumis, Ametek, APi Group, Aptiv, Arrow Electronics, Avient, Ball Corp, Bandwidth, BCE Inc, Belden, BorgWarner, Bristol Myers Squibb, California Water Service, Canada Goose, Canadian Natural Resources, Cheniere Energy, Cinemark, CMS Energy, ConocoPhillips, Cullen/Frost, Donnelley Financial, Driven Brands, Dun & Bradstreet, Eaton, Ecovyst, EMCOR Group, Entergy, Enviri Corporation, Estee Lauder, Federal Signal, Ferrari, First Majestic Silver, Fresh Del Monte, Generac, Genesis Energy, Gildan Activewear, Grainger, Granite Construction, Green Plains, HF Sinclair, Huntington Ingalls, Hyatt Hotels, IdaCorp, IDEXX Labs, Inhibrx Biosciences, Insperity, International Paper, Intercontinental Exchange, InterDigital, IQVIA, Itron, Janus Henderson Group, Kellanova, Kimco Realty, Kontoor Brands, Kymera Therapeutics, Lancaster Colony, Laureate Education, Lazard, LendingTree, Li Auto, Lightspeed, Lincoln Electric, Lincoln National, Linde, Madrigal Pharmaceuticals, Malibu Boats, Mastercard, Merck, MGP Ingredients, Mobileye Global, Norwegian Cruise Line, Open Text, Organon, Patrick Industries, PBF Energy, Peabody Energy, Peloton Interactive, PHINIA, Quanta Services, Radware, Regeneron Pharmaceuticals, Roblox, SharkNinja, SolarWinds, Southern, STMicroelectronics, SunCoke Energy, TC Energy, Teleflex, The Cigna Group, Trinity Industries, Uber Technologies, Uniti Group, Upbound Group, Utz Brands, Vontier, WEC Energy Group, Wendy’s, Willis Towers Watson, Xcel Energy & Xylem, with Amazon.com, Apple, ACCO Brands, Agnico-Eagle Mines, Alliant Energy, Amcor, Ardelyx, Asure Software, Atlassian, BJ Restaurants, Camden Property, CNO Financial, Cohu, Concentra Group Holdings Parent, Coterra Energy, CubeSmart, Customers Bancorp, Dorman Products, Eastman Chemical, El Pollo Loco, Fox Factory Holding, Grid Dynamics, Halozyme Therapeutics, ICF International, Ingersoll-Rand, Intel, Juniper Networks, Lemaitre Vascular, MasTec, Mercer International, Onto Innovation, Quaker Chemical, Reinsurance Group of America, Sabra Health Care REIT, Select Medical, SkyWest, SM Energy, Sonoco Products, Tennant, U.S. Steel, Verra Mobility, Viavi, VICI Properties & Vir Biotechnology reporting after the closing bell.

Friday morning brings us U.S. Employment Report, U.S. Unemployment Rate, U.S. Hourly Wages & Hourly Wages Year-over-Year data at 8:30 am, followed by S&P final U.S. Manufacturing PMI data at 9:45 am, Construction Spending & ISM Manufacturing data at 10 am & Auto Sales data.

Alpha Metallurgical Resources, ArcBest, Ares Management, BrightSpring Health Services, Cardinal Health, Cboe Global Markets, Chart Industries, Charter Communications, Chevron, Church & Dwight, DigitalBridge, Dominion Energy, Enbridge, Essent Group, Exxon Mobil, fuboTV, Imperial Oil, Interface, LyondellBasell, Magna, Moog, nVent Electric, Pediatrix Medical Group, PPL Corp, Protolabs, RBC Bearings, Simon Properties, T. Rowe Price, Telus, TXNM Energy, TXNM Energy & Wayfair are all scheduled to report earnings before Friday’s opening bell.

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 ***

SPY, the SPDR S&P 500 ETF added +0.86% last week, while the VIX closed at 18.03, indicating an implied one day move of +/-1.14% & an implied one month move of +/-5.21%.

Their RSI is advancing towards the overbought level of 70 & sits currently at 66.24, while their MACD is bullish, but its histogram is signaling that it is losing steam following last week’s relatively flat performance.

Volumes were -40.04% below the previous year’s average levels (38,592,000 vs. 64,338,465), as market participants have clearly begun to show signs of caution in regards to the U.S. election & international relations in October.

For comparison, using April 21, 2024’s Market Review Note‘s prior year’s average volume of 78,101,687 (last peak volume was 4/19/2024 before volumes began to significantly decline) the current prior year’s average volume is -17.62% lower & the past week’s volume was -50.59% lower.

Now let’s look at what happened last week.

Monday kicked the week off on a gap up session that continued to climb higher, closing with only a small upper shadow, but on less than stellar volume.

Profit taking & warning lights began flashing on Tuesday, when the day’s session resulted in a bearish engulfing candle on a declining session on volume that eclipsed the rest of the month, minus 10/1/2024’s declining session’s volume.

Wednesday opened in-line with Tuesday’s close & saw more selling temporarily as more investors took profits following Monday’s gap up & the week before’s advances (there was no market note last week as I was on vacation).

The session also had the lowest volume of the week, and given the week was weak, it may be the start of investors becoming extremely cautious as we run up to the U.S. Presidential Election.

The cautious attitude continued into Thursday, as while the session advanced on the day to set a new all-time high for SPY, it opened on a gap up, nudged higher (minuscule upper shadow), before tumbling to close just above the prior day’s close, closing lower than it opened (bearish).

Thursday’s volume was also the second lowest of the week, adding confirmation to the already bearish looking set up.

Friday’s session opened midway through Thursday’s candle’s real body range & resulted in a hanging man candle that closed lower than it opened, with limited test to the upside (small upper shadow) & the day’s low was slightly higher than Thursday’s low.

What is even more interesting about Friday’s session is that the candle formed a harami pattern with Thursday’s.

Typically an advancing session (+0.38% intraday) is considered bullish, which would mark this a bullish harami.

However, given the fact that it closed below its open & resulted in a filled candle, there is plenty of bearish sentiment & reason to interpret it as a bearish harami, which when paired with the low volume & other bearish elements of the week reason for caution moving into the week ahead.

Aside from the previously mentioned potential market moving news, there is a plethora of earnings reports due out this week that are all outlined in “The Week Ahead” at the bottom of this article which may be a catalyst for more volatility in the coming week, along with the Fed’s Beige Book being released on Wednesday.

Those earnings calls will be something to keep an eye on in the coming week, as will the volume levels of the week, as if Wednesday’s volume stands as a spike it will likely down the road be viewed as a reversal point, especially with how bearish the rest of the week was (even if it did advance slightly higher).

The next order of business will be to watch how the 10 day moving average holds up as a support level in the event of a leg down, as it is currently at a level where there is not much historic volume data to based how investor sentiment may be should that test come.

While there is a light support zone between $561.89 & $563.43, that begins -3.62% from Friday’s closing price.

It’s worth noting that $561.89 is the 50 day moving average & it will continue rising as time progresses, pinching the zone smaller & smaller as days pass.

While the touch-points in this zone are all historically dominated by Buyers at a rate of 10:1 by volume (see “Volume Sentiment” link below), this range has seen limited testing & sits near price extremes, so it has not seen much in terms of testing.

This can be seen when you consider the gap downs & wide-range declining sessions that took place at these levels, making any retest of these levels dilute the historic Buyer sentiment.

It would also be prudent to watch SPY’s RSI, as the last time it approached the overbought 70 mark it retreated rather than crossing over it like we’ve seen happen a majority of the other times it’s approached it this year.

If there is not an increase in volume as it approaches that level again it is a signal to take caution.

Also, referring to the 10 DMA point above, should price drop below it & it becomes a resistance level, look at the prior year’s examples of what’s happened when this occurs.

Given they’re at all-time highs there is little to review regarding their upside.

The table below breaks down volume sentiment at each price level SPY has traded at over the past ~2 years & can be referenced to see how strong or weak SPY’s support or resistance levels may be (the link explains how to read the table).

SPY has support at the $578.72 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $563.43 (Volume Sentiment: Buyers, 10:1), $562.48 (Volume Sentiment: Buyers, 10:1) & $561.89/share (50 Day Moving Average, Volume Sentiment: Buyers, 10:1) price levels, with resistance at the $586.12/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 gained +0.22%, faring the worst of the major four index ETFs.

Their RSI is rising towards overbought levels & currently sits at 60.85, while their MACD is has flattened out but it bullish after dipping below the signal line for a couple of sessions.

Volumes were -33.43% lower than the prior year’s average volume (27,278,000 vs. 40,977,632), which as we just outlined in SPY is a reason to consider taking caution in the near-term.

Using the same 4/21/2024 market data as SPY’s comparison (49,155,742 was the average annual volume), the current average past year’s volume for QQQ is -16.64% lower, while last week’s average volume was -44.51% lower than that benchmark.

Now that the A.I. & Semiconductor trade has begun to wane in popularity we’ve witnessed a big shift in volumes between SPY & QQQ vs. IWM & DIA.

As noted, SPY & QQQ have moved in a much more similar manner to one another than the latter two index ETFs.

QQQ’s week also began on a gap up session where the day’s high marked a recent resistance level on volumes that were nothing to write home about.

Tuesday saw a -1.34% decline on the week’s highest volume, which is second highest for October minus 10/1/2024’s declining volume & formed a very large bearish engulfing candle.

Much of this was likely profit taking in the wake of the previous week’s run up & it should be noted that the 10 day moving average’s support managed to hold up, despite the day’s low testing it.

Bearishness & cautious sentiment carried on Wednesday, when QQQ opened opened just above the 10 day moving average’s support, briefly broke through it but managed to close the day as a dragonfly doji.

Dragonfly dojis tend to signal that there may be a price reversal move coming up, but given that there is no trend to reverse from & the low volume.

Thursday opened with a glimmer of optimism on a gap up, only to drag lower throughout the day & close in-line with the 10 DMA lower than it opened, another sign of caution.

Friday continued to theme of risk-off/take caution ahead as the session opened midway between Thursday’s real body range & closed as a harami cross.

Typically this would indicate that the current trend may be winding down & setting up to reverse, but the recent trading activity has been relatively choppy & not strongly trending in one way or another.

With this in mind, the week ahead will be time to watch the price of QQQ in relation to the 10 day moving average.

We’ll likely see a retest of it based on Fed speakers & earnings calls at some point in the week & how strong that support level holds up will be a key determinant of QQQ’s near-term performance.

This is going to be especially important given that the price range it sits in now is Seller dominated 3:1 over the past 2-3 years & the next two zones beneath it (table below) are Buyer dominated, but not by much.

If those zones are passed through we may see 5%+ declines from Friday’s closing price as the two zones beneath it favor the Sellers.

There is also only one support level that falls into those two aforementioned Buyer zones, which will make it difficult for QQQ to find footing without sliding into those Seller zones.

In terms of the upside potential, the $498.83 mark is going to be an area to keep an eye on, as if volumes improve & prices are driven up above it there may be a possible run at the recent all-time high of $502.81.

QQQ has support at the $493.70 (Volume Sentiment: Buyers, 0.7:0*), $491.55 (10 Day Moving Average, Volume Sentiment: Sellers, 3:1), $484.86 (Volume Sentiment: Buyers, 1.6:0*) & $477.40/share (Volume Sentiment: Sellers, 1.05:1) price levels, with resistance at the $498.83 (Volume Sentiment: ) & $502.81/share (All-Time High, Volume Sentiment: Buyers, 0.6:0*) price levels.

IWM, the iShares Russell 2000 ETF advanced +1.98% last week, as small caps had the strongest week of the major four index ETFs.

Their RSI is trending down towards neutral but still sits closer to overbought levels at 63.84, while their MACD is bullish, but beginning to show signs of a bearish rollover in the near-term.

Volumes were -35.74% below the previous year’s average (22,194,000 vs. 34,538,583), which is bad given that IWM currently has a higher past year’s average volume than it did in April.

Compared to the 4/21/2024 market data where IWM’s prior year’s average volume was 34,864,840, IWM’s current prior year’s average volume is +0.94% higher, while last week’s volume was -35.74% lower.

Monday IWM started off on a sleepy note, when the week began with a very low volume session that opened just above Friday’s close, tested lower before trudging up to close the day out as an advancing session, but with lackluster participation.

Tuesday is when things began to get murky for IWM, as the session opened slightly higher, tested briefly into Monday’s range, before rocketing higher to break above the $225/share mark, when folks began taking profits & forced the price down so low that the day ended as a high wave candle & spinning top.

This is troubling as the real body of the candle is concentrated at the bottom of the day’s range & the upper shadow is much higher than the lower, indicating that there was not enough bullish sentiment to keep climbing higher.

This makes Wednesday’s candle even more interesting, as the day began on a gap up, briefly tested lower before powering higher on the week’s highest volume.

It set the stage for the range that the rest of the week would trade in for IWM, as Thursday opened slightly higher, only to test down to the bottom of Wednesday’s candle’s real body & find bullish support around the $225/share mark & closed as a hanging man candle (bearish).

Bearish sentiment carried on into Friday as investors were not willing to carry small cap risk into the weekend & continued taking profits from the run-up of the past week.

While the last two sessions of the week were bearish, the volumes behind the movements was not particularly strong.

This week will be important to watch how the window created by Wednesday’s gap up holds up or if it becomes filled, as Wednesday’s session’s high was unable to reach the 52-week high set in July.

Should that window be filled there will be a pair of support touch-points in the $221.57-221.69 (first number may increase as it is the 10 DMA) which will prove to be vital for IWM’s price, as should they break down there are no other support levels until it enters a Seller dominated price zone where they’ve outnumbered Buyers 3.3:1.

The good news is that this support level is the 50 day moving average, which will continue higher, but if IWM declines below that & both the 10 & 50 DMAs are applying resistance & downward pressure on the price there are no support levels again until $210.57.

Volume will be imperative to watch as well, as it may lend clues into which way IWM will break out as the current volume levels are lackluster & reflect cautious sentiment.

IWM has support at the $221.69 (Volume Sentiment: Buyers, 2.86:1), $221.57 (10 Day Moving Average, Volume Sentiment: Buyers, 2.86:1), $216.16 (50 Day Moving Average, Volume Sentiment: Sellers, 3.3:1) & $210.57/share (Volume Sentiment: Buyers, 2:1) price levels, with resistance at the $227.17 (Volume Sentiment: Buyers, 1.6:0*) & $227.85/share (52-Week High, Volume Sentiment: Buyers, 1.6:0*) price levels.

DIA, the SPDR Dow Jones Industrial Average ETF climbed +0.91% last week, having the second strongest week behind IWM.

Their RSI has flattened just beneath the overbought level & currently sits at 68.43, while their MACD is still bullish, but may be losing steam if they do not advance early in the next week following the past two days’ relatively flat performance.

Volumes were -20.98% below the previous year’s average volume (2,762,000 vs. 3,495,512), as investors have even grown cautious around the blue chip index names.

Compared to the 4/21/2024 market data when DIA’s average prior year’s volume was 3,508,088, DIA’s current prior year’s average volume is -0.36% lower & their past week’s volume was -21.27% lower.

DIA’s week began on a bullish note, although their RSI was nudging up against the overbought level, which helped pave the way for the more cautious approach the rest of the week took.

They opened just below Friday’s close before powering higher, but it should be noted it was on the week’s weakest volume.

Tuesday opened lower & was unable to find any footing as profit taking pushed DIA’s price down into the close on the week’s second highest volume, which indicated that in addition to the desire to capture profits, there was also a bit of uneasiness gripping into DIA’s pricing.

Wednesday’s session produced a bullish engulfing candle, but again, on light volume which did not indicate that there was a potential breakout at-hand.

Thursday gapped up, but the day resulted in a dragonfly doji with the week’s highest volume.

This would normally be something of more interest & perhaps carry more bullish implications, but given it set a new all-time high & tested down almost to Wednesday’s high it appears that market participants were not overly eager to continue pushing higher.

This was confirmed Friday when the session resulted in another dragonfly doji, on lower volumes, that also saw a bit of bearish selling pressure as market participants were ready to take some chips down from the table heading into the weekend.

Friday was also the second lowest volume of the week, which makes Thursday’s price movement look even less remarkable.

Heading into this week it will be interesting to watch if DIA is able to trudge any higher, given that they hit the all-time high so late in the week (Friday).

The window created by Thursday’s open will also be an area to watch in to see if it becomes filled, as well as DIA’s RSI, as it has flattened out just below the overbought mark of 70 & will need to split one way or the other in the near-term.

While the table below is one month old & may need to be refreshed, the low volume environment DIA has traded in has caused a set up where for the next -2.92% from Friday’s closing price there is limited Buyer:Seller information to gauge sentiment.

With that in mind, keep an eye on the volumes that you see coming in during the week to get an idea as to how market participants may be slanted in terms of their near-term outlook.

Also, should the 10 Day Moving Average’s support break down, there is support at the $426.05/share level (-1.52%), before nothing for an additional -1.86%, which is when DIA returns to Buyer dominated price levels for another ~3%.

One thing of note though is that with the exception of $408-411.99, these Buyer zones are relatively untested so far by Sellers, and it would be wise to keep that in mind should these price levels be tested.

DIA has support at the $427.18 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $426.05 (Volume Sentiment: NULL, 0:0*), $418.12 (Volume Sentiment: Buyers, 02.:0*) & $415.17/share (Volume Sentiment: Buyers, 0.8:0*) price levels, with resistance at the $433.20/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Monday kicks off with Fed President Logan speaking at 8:55 am, followed by U.S. Leading Economic Indicators data at 10 am.

Sandy Spring Banc reports earnings Monday morning before the opening bell before AGNC Investment, Alexandria RE, BOK Financial, Cadence Bank, Cathay Bancorp, Equity Lifestyle Properties, HealthStream, Hexcel, Medpace Holdings, Nucor, Simpson Manufacturing, W.R. Berkley & Zions Bancorp report after the session’s close.

Fed President Harker speaks Tuesday morning at 10 am.

Tuesday morning’s earnings calls include GE Aerospace, Verizon, 3M, A.O. Smith, Atlantic Union Bankshares, Banc of California, Comcast, Community Financial System, Danaher, Denny’s, Fiserv, Freeport-McMoRan, GATX, General Motors, Genuine Parts, Herc Holdings, Interpublic, Invesco, Kimberly-Clark, Lockheed Martin, Moody’s, Old National Bancorp, PACCAR, Pentair, Philip Morris International, Polaris Industries, PulteGroup, Quest Diagnostics, RTX & Sherwin-Williams, with Agree Realty, Baker Hughes, Brandywine Realty, Canadian National Railway, CoStar Group, East West Bancorp, Enova International, Enphase Energy, Highwoods Properties, JBT Corp, Manhattan Associates, Matador Resources, Nabors Industries, National Bank, Packaging Corp of America, PennyMac, Range Resources, Retail Opportunity Investments, Robert Half, Seagate Technology, Stride, Texas Instruments, Trustmark, Valmont Industries, Veritex Holdings & Vicor all reporting after the closing bell.

Wednesday brings us Existing Home Sales data at 10 am & the Fed’s Beige Book at 2pm.

Amphenol, AT&T, Avery Dennison, Boeing, CME Group, Coca-Cola, Constellium, Evercore, GE Vernova, General Dynamics, Healthcare Services Group, Hilton, KBR, Lennox International, Lithia Motors, Mr. Cooper Group, New Oriental Education & Technology, NextEra Energy, NextEra Energy Partners, Northern Trust, Old Dominion, PROG Holdings, Prosperity Bancshares, Roper, Stifel Financial, Taylor Morrison Home, Teledyne Technologies, Thermo Fisher Scientifi, TransUnion, Travel + Leisure Co, UniFirst, United Community Banks, Vertiv Holdings, Westinghouse Air Brake Technologies, Watsco & Winnebago are all due to report earnings before Wednesday’s opening bell, with Tesla, Align Technology, Ameriprise Financial, ASGN Incorporated, CACI International, Canadian Pacific Kansas City, Celestica, Century Communities, Churchill Downs, Community Health, Core Labs, EastGroup, Equity Commonwealth, Essential Properties Realty Trust, Globe Life, Goosehead Insurance, Graco, Greenbrier, International Business Machines, ICON, Impinj, Kaiser Aluminum, Knight-Swift Transportation Holdings, Lam Research, Las Vegas Sands, Lending Club, Mattel, MaxLinear, Moelis, Molina Healthcare, MSA Safety, Newmont, O’Reilly Automotive, Oceaneering International, Pathward Financial, Patterson-UTI, Pegasystems, Plexus, QuantumScape, Raymond James, Rollins, Sallie Mae, SEI Investments, ServiceNow, Simulations Plus, South State, Stewart Info, T-Mobile US, Teradyne, Tyler Technologies, United Rentals, Veralto, Viking Therapeutics, Waste Connections, WesBanco, Western Union, Whirlpool & Wyndham Hotels & Resorts reporting after the session’s close.

Initial Jobless Claims data comes out Thursday morning at 8:30 am, followed by S&P Flash U.S. Services PMI & S&P Flash U.S. Manufacturing PMI data at 9:45 am & New Homes Sales data at 10 am.

Thursday morning’s earnings calls include ADT, Alkermes, Allegion, AllianceBernstein, American Airlines, Applied Industrial, Berkshire Hills Bancorp, Bread Financial, Brunswick, Carpenter Technology, Carrier Global, CBRE Group, Columbia Banking, Dover, Dow, DTE Energy, Euronet, Expro Group, First Merchants, FirstService, FTI Consulting, Harley-Davidson, Hasbro, Honeywell, Integer Holdings, Keurig Dr Pepper, KKR, Labcorp Holdings, Lear, Life Time, Lindsay Corp, LKQ, MSC Industrial, NASDAQ, NetScout Systems, Northrop Grumman, OSI Systems, Pacific Premier, Pool, Radius Recycling, Reliance, Rogers Communications, RPC, Ryder System, S&P Global, Simply Good Foods, Sonic Automotive, Southside Banc, Southwest Air, TechnipFMC, Teck Resources, Textron, Tractor Supply, TRI Pointe Homes, Union Pacific, United Parcel Service, Valero Energy, Valley National, Virtu Financial, Visteon, Wabash National, West Pharmaceutical Services & WEX, followed by Ameris Bancorp, AppFolio, AptarGroup, Arthur J. Gallagher, Associated Banc-Corp, Beyond, Boston Beer, Boyd Gaming, Capital One, Carlisle Cos, Cincinnati Financial, Coursera, Cousins Properties, Deckers Outdoor, Dexcom, Digital Realty Trust, Edwards Lifesciences, Exponent, Federated Hermes, First Financial Bancorp, First Interstate Bancsystem, Gaming and Leisure Properties, Glacier Bancorp, Hartford Financial, Healthpeak Properties, Kinsale Capital, Knowles, L3Harris, McGrath RentCorp, Minerals Technologies, Mohawk Industries, NOV Inc., Olin, Phillips Edison & Company, Piedmont Office Realty Trust, Principal Financial Group, ResMed, Seacoast Banking, Skechers USA, SPS Commerce, SS&C Technologies, Texas Roadhouse, Tronox, Universal Health, VeriSign, Western Digital, Weyerhaeuser & WSFS Financial after the closing bell.

Friday the week winds down with Durable-Goods Orders & Durable-Goods Minus Transportation data at 8:30 am, followed by Consumer Sentiment (final) data at 10 am.

The week winds down with Aon, AutoNation, Avantor, Balchem, Barnes Group, Booz Allen Hamilton, Centene, Colgate-Palmolive, First Hawaiian, Gentex, HCA, Lakeland Financial, New York Community, Newell Brands, Piper Sandler, Portland General Electric, Saia, Sanofi, Sensient, Stellar Bank, TriNet Group & WisdomTree reporting earnings before the session’s opening bell.

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 ***

SPY, the SPDR S&P 500 ETF advanced +0.26% last week, having the best week of the major four index ETFs, while the VIX closed the week out at 19.21, indicating an implied one day move of +/-1.21% & a one month implied move of +/-5.55% for the S&P 500.

Their RSI is trending towards overbought levels after Friday’s gap up session & currently sits at 62.77, while their MACD is lightly bearish & sitting relatively flat with the signal line; again, as a result of Friday’s moves after crossing bearish a couple of days prior.

Volumes were still notably low, coming in -21.65% below the past year’s average volume (51,658,000 vs. 65,934,287), which as we highlighted last week marks a steep decline from where the prior year’s average volume readings were coming in at 5-6 months ago ( that market note here).

Monday began the week on a moderately upbeat note, there was the second highest volume of the week on a bullish session that despite dipping low enough to test the 10 day moving average’s support was able to find legs & close higher for the day.

It was not able to test the all-time high set the previous Thursday though, a clear sign that market participants have become exhausted & are not overly eager to chase SPY or its component stocks much higher.

Tuesday this uneasiness was confirmed when markets opened lower, and despite temporarily testing higher (shown by candle’s upper shadow), the session was largely bearish, with the week’s highest volume coming as bears pushed the price to break beneath the 10 DMA’s support temporarily, before rising back up to close the day just beneath it; clearly showing some cracks have formed.

Wednesday added more fuel to the fire, when SPY opened lower, tested lower, but ultimately rallied to end the day as an advancing session, but was unable to break above the resistance of the 10 DMA.

Things continued on this track into Thursday, when the session opened lower & floundered around all day to prove unable to break above the 10 DMA’s resistance, but to also show that there was not enough bearish sentiment among market participants to force prices to the low levels of the prior day.

Ultimately, Thursday ended in a spinning top candle in a declining session, indicating that there was a lot of uneasiness in the market & uncertainty regarding SPY.

This made Friday’s price action look like a squeeze, as the volume was the third highest of the week, but far below that of the top two days, prices opened on a gap up above the 10 DMA’s resistance, but intraday crossed below it’s support, only to rally higher but still close lower than the session opened as a hanging man candle.

While the MACD & RSI temporarily benefitted from this movement, it does not come across as being something with a solid foundation that is built to last & indicates that there is reason to be cautious in the coming week regarding SPY (And the other major indexes, for that matter).

Prices have similarly shown weakness in days leading up to days that manage to pop above the 10 DMA’s support only to fall in the coming sessions in May & August & given the existing weakness that we are seeing for SPY this looks to be the case coming into tomorrow.

Heading into the coming week the 10 DMA will continue to be an area of focus for SPY, as well as any volume clues that may come along with the price action, as despite overall volumes being lower than usual, there are still subtle clues that can be taken from the behavior of market participants about their current sentiment & next moves.

Last week’s support level notes will also be relevant this week (apologies for keeping this note brief, but I am on vacation & preparing for an all-day charity event tomorrow, as well as a hurricane the next day).

Those notes regarding the support for SPY all remain true, especially given the way the RSI & MACD moved over the past five days.

This week will feature a lot of Federal Reserve speakers, as well as the FOMC Minutes from the September meeting (released Wednesdays at 2pm) & big bank earnings kick off the next earnings season beginning on Friday.

Aside from that, there is also CPI, PPI & earnings from Domino’s Pizza & PepsiCo during the week, all of which will shed more light into the state of the average consumer & how they’re coping with inflation.

SPY has support at the $570.68 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $563.43 (Volume Sentiment: Buyers, 10:1), $562.48 (Volume Sentiment: Buyers, 10:1) & $553.17/share (Volume Sentiment: Buyers, 1.92:1) price levels, with resistance at the $574.71/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 added +0.12% last week, having the second strongest showing of the major four index ETFs.

Their RSI is also trending higher towards overbought after Friday’s session & currently sits at 60.1, while their MACD remains bullish, but the MACD line is flat just above the signal line, which can lead to a bearish crossover in the coming days given how close together they are.

Volumes were -26.92% below the prior year’s average (30,578,000 vs. 41,840,661), as market participants are still not showing confidence or enthusiasm for the tech-heavy index.

Monday began on a similar shaky note as SPY, as while prices advanced for the session, they did test down to the 10 day moving average’s support during the sessions, indicating that there was downside appetite & blood in the water.

Bears came out in full force Tuesday, forcing prices to decline through the 10 DMA’s support on the week’s highest volume as investors began to show that QQQ is not on stable footing in the near-term & despite clawing back from the lows of the day’s candle’s lower shadow it was unable to close above the 10 DMA.

Wednesday the weakness & indecision theme continued, with QQQ opening lower, testing lower throughout the day & ultimately closing as a spinning top candle, indicating indecisiveness.

The 10 DMA’s resistance held up strength & it was the lowest volumes of the week, showing that there was not much conviction or enthusiasm for market participants to see QQQ go higher.

Thursday opened on a gap down & the bulls came back out to play, forcing QQQ higher, but still not being able to rally enough to force the close above the 10 DMA’s resistance, and the session closed out midway between the real body of Wednesday’s candle.

Friday reflected similar price movement that SPY saw, where a gap up day closed as a hanging man candle that closed lower than it opened while having crossed below the 10 DMA’s support, but managing to close above it.

This week keep an eye on the 10 DMA’s strength of support, as once it becomes a resistance level the recent tests have proven that it is likely to remain one for a while, as investors have not been keen to pick up risk much near it this past week.

The other primary concerns of last week are all still in play this week & can be found here: 9/29/2024’s Market Review Note.

QQQ has support at the $485.07 (10 Day Moving Average, Volume Sentiment: Buyers, 1.6:0*), $484.86 (Volume Sentiment: Buyers, 1.6:0*), $477.40 (Volume Sentiment: Sellers, 1.05:1) & $474.88/share (Volume Sentiment: Sellers, 1.08:1) price levels, with resistance at the $493.70 (Volume Sentiment: Buyers, 0.7:0*) & $502.81/share (All-Time High, Volume Sentiment: Buyers, 0.6:0*) price levels.

IWM, the iShares Russell 2000 ETF declined -0.54% last week, as the small cap index was the least favored among market participants.

Their RSI just bounced off of the neutral 50 mark & is moving higher towards overbought territory following Friday’s gap up session, while their MACD has crossed over bearishly last week.

Despite this bearish crossover the MACD line has flattened out, but it still sits beneath the signal line & is not likely to break above it this week, unless there is some major revelation that comes from the FOMC Minutes that not one has priced in, or a surprise in inflation data from CPI/PPI.

Volumes were also the lowest of all index ETFs, coming in -34.03% lower than the previous year’s average volume (23,138,000 vs. 35,072,964), as market participants have been less eager to get into small cap names over the past couple of weeks, after a rally in the index in the two weeks before that.

Monday started off IWM’s week on an ominous note, as IWM opened below the 10 day moving average, tested further lower, before rallying higher on volume that was average for the week (3rd highest), which was not a clear sign of strength & bullish conviction.

Tuesday the weakness really began to show, as the session opened about midway between the real body of Monday’s candle, but sellers drove the price down to below the $217.50/share mark & despite bull’s best efforts, the day closed out as a declining session.

Needless to say, this also happened to have been the highest volume session of the week, signaling that there was a lot of folks ready to hop out of the IWM pool at the price levels tested, and that while there was some appetite to push prices higher, the day’s close was still below the midway mark of the day’s range.

Wednesday the declines continued & indecision remained king as the session ended in a spinning top, but the close was higher than the opening gap down, signaling that there were muted signs of optimism for the small caps, and volumes were the lowest of the week.

Thursday’s long legged doji candle showed a lot of indecision & uncertainty in the small cap world for IWM, as prices covered the $217.23-215.08 range throughout the day, only to close slightly lower than they opened.

Friday’s +1.4% gap higher session was able to close above the 10 day moving average’s resistance, however the majority of the day’s price action took place below the 10 DMA’s resistance & the close was lower than the open, indicating weakness.

Friday did have the second highest volume of the week, which would be expected based on the wide range of prices that were tested that day, particularly to the downside.

Last week’s thoughts about the week ahead for IWM are all still also largely in play, as ultimately the week took a decline but only lost -0.54% W-o-W.

IWM has support at the $218.89 (10 Day Moving Average, Volume Sentiment: Sellers, 3.3:1), $214.37 (50 Day Moving Average, Volume Sentiment: Buyers, 1.69:1), $210.57 (Volume Sentiment: Buyers, 2:1) & $208.58/share (Volume Sentiment: Buyers, 2:1) price levels, with resistance at the $221.69 (Volume Sentiment: Buyers, 2.86:1), $224.17 (Volume Sentiment: Buyers, 1.6:0*) & $227.85/share (52-Week High, Volume Sentiment: Buyers, 1.6:0*) price levels.

DIA, the SPDR Dow Jones Industrial Average ETF gained +0.11% last week, as investors were not overly eager to keep pushing higher after hitting recent all-time highs.

Their RSI is trending towards overbought levels & sits at 64.31 following Friday’s performance, while their MACD crossed over bearishly last week & remains below the signal line.

Volumes were -6.32% below the previous year’s average (3,314,000 vs. 3,537,391), and one thing of note is how the largest volume spike of the week was for a declining session.

Monday set the stage with a hanging man candle with “long legs” based on the lower shadow & appetite for downside DIA price movement it showed, as prices broke through the support of the 10 DMA before rallying back to close for an advancing session.

Tuesday opened lower, tested in the real body of Monday’s candle, before dunking below the 10 DMA & returning to close lower for the day straddling the waterline of the 10 DMA.

Again, the volume of Tuesday’s downside action speaks volumes about how market participants feel right now, as profit takers were met by enough buyers to still force prices back up to the 10 DMA.

Wednesday the negative sentiment continued, as prices opened in the middle of Tuesday’s real body, did not get much higher & ultimately dipped below the 10 DMA’s support again.

Bulls rushed in & were able to force the price to just back above the 10 DMA’s support level, but the session closed lower than it opened & the volumes for the day reflect low participation levels, meaning that despite the “positive” close, there was quite a bit to be negative about.

Thursday confirmed this when prices gapped lower, test higher towards the 10 DMA’s resistance but were rejected, only to test far lower & still close as a decline.

While there were enough buyers to force a large lower shadow, volumes were still meager; hardly a vote of confidence.

Friday DIA saw the same good fortunes as every index ETF above, a gap up open that was above the 10 DMA’s support, but they broke below it for a while before rallying to close higher & end the day with a hanging man candle on low volume.

This is reflecting bearish sentiment for the blue chip index, and all of last week’s observations for the week ahead items to watch are still in play.

Thank you for referring back to last week for these observations while I am working on this with limited time compared to usual.

DIA has support at the $421.68 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $415.32 (Volume Sentiment: Buyers, 0.8:0*), $412.11 (Volume Sentiment: Buyers, 0.8:0*) & $408.89/share (50 Day Moving Average, Volume Sentiment: Buyers, 3.4:1) price levels, with resistance at the $426.20/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Monday the week kicks off with Fed Governor Bowman speaking at 1pm, Consumer Credit data at 3pm & Fed President Musalem speaking at 6:30 pm.

Tuesday morning’ earnings calls feature PepsiCo & Accolade.

Fed Governor Kugler speaks at 3 am Tuesday, followed by NFIB Optimism Index data at 6 am, U.S. Trade Deficit data at 8:30 am, Fed President Bostic speaking at 12:45 pm & Fed Vice Chair Jefferson speaking at 7:30 pm.

Helen of Troy reports earnings Wednesday before the opening bell, with AZZ due to report following the closing bell.

Wednesday features Fed President Bostic speaking at 8 am, Fed President Logan speaking at 9:15 am, Wholesale Inventories data & Fed President Goolsbee speaking at 10:30 am, FOMC Minutes From The Fed’s September Meeting at 2pm & Fed President Daly speaking at 6 pm.

Thursday morning’s earnings reports include Delta Airlines, Domino’s Pizza, Neogen & Tilray.

Initial Jobless Claims, Consumer Price Index, Core CPI & Core CPI Year-over-Year data are all released at 8:30 am Thursday, before Fed Governor Cook speaks at 9:15 am, Fed President Barkin speaks at 10:30 am & Fed President Williams speaks at 11 am.

JP Morgan Chase, BlackRock, BNY Mellon, Fastenal & Wells Fargo are all due to report earnings before Friday’s opening bell.

Friday morning starts off with Producer Price Index, Core PPI, PPI Year-over-Year & Core PPI Year-over-Year at 8:30 am, Fed President Goolsbee speaks at 9:45 am, Consumer Sentiment (prelim) comes in at 10 am, Fed President Logan speaks at 10:45 am & Fed Governor Bowman speaks at 1:10 pm to wind down the week.

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 ***

SPY, the SPDR S&P 500 ETF gained +0.57% in another week with subpar volumes, while the VIX closed at 16.96, indicating an implied one day move of +/-1.07% & an implied one month move of +/-4.9%.

Their RSI is currently at 64.61 & has begun to curl over bearishly, heading back towards the neutral level while their MACD is also curling over bearishly & looks set to cross the signal line bearishly in the coming days.

Volumes were -34.28% below the previous year’s average last week (43,960,000 vs. 66,888,340) as market participants are still largely sitting on the sidelines uneasily as prices continue to set & flirt with new all-time highs.

As we’ve highlighted on here over the past month or so, volumes when compared to the average volume of the year before April 2024 are even lower, as for the past ~5 months volumes have been extremely muted.

In our report on 3/31/2024 the average prior year’s volume for SPY was 77,829,780, making today’s average previous year’s volume -14% lower than where it was in March, which is a fairly decent size drop off & not a signal of confidence in the S&P 500.

SPY’s week started off on an uncertain note, as Monday’s session resulted in a dragonfly doji, indicating that there was some downside appetite but the day was able to open & close near the high end of its price range.

Monday’s session was the third highest volume session of the week, as investors were not overly eager to jump back into SPY right out of the gate.

Tuesday this trend continued, as volumes were the second highest of the week on another session that resulted in a dragonfly doji.

The lower shadow on Tuesday’s candle also indicated that there was a lot of downside appetite, but that the bulls were able to drive the price back up to close just above the day’s opening price.

Wednesday is when things began to flash weakness for SPY, as the session opened just below Tuesday’s close & proceeded lower throughout the day.

However, much like the prior two days there was a lack of volume as Wednesday was SPY’s least active session of the week.

Thursday things gave a glimmer of optimism after the PBOC announced new easing measures, but it came with a hint of doubt.

The session gapped higher but was unable to continue higher, tested into Wednesday’s candle’s real body before closing slightly higher than Wednesday, but at a lower price than their open.

Thursday also had the strongest volumes of the week for SPY, indicating that there was a bit of profit taking throughout the day & that the reality was slowly becoming more risk-off after five consecutive sessions of dojis that came after a gap up the prior Thursday.

Friday the risk-off sentiment was echoed, as SPY closed down -0.15%, although it should be noted that the two lowest volume sessions of the week came on the declining days.

As noted before, there has been little but indecision & mixed signals in the market since last Thursday’s session, when SPY gapped up on the open & proceeded to close below the opening price.

Market participants are beginning to look more & more skittish each passing week & there has not been such long consecutive string of doji candles in the past year, which gives off the feeling that we’re approaching at least a temporary falling of the Jenga tower.

Like last week, the 10 day moving average & its relationship to SPY’s price will be a key area of importance to track this coming week.

Any breakdown of that support level will begin to put pressure on SPY’s price, particularly at times where the volumes have been so low such as this past week.

Given how close they are to their all-time high there is little to measure against for SPY’s upside potential this week, but given the low level of major earnings reports & high number of Fed speakers continuing into the week combined with their RSI & MACD readings it looks like SPY is set to pump the brakes this week.

It should be noted that SPY’s 50 DMA’s support level is ~4% below their current price & edging higher, and currently sits just below a price zone that is dominated by Sellers at a rate of 1.25:1, which will be another area to keep an eye on in the event of declines.

Should the 50 DMA be broken through to the downside the $537.79-535.81 support levels will be in play, also occurring just after a Seller dominated price zone (1.4:1).

SPY has support at the $567.44 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $563.43 (Volume Sentiment: Buyers, 10:1), $562.48 (Volume Sentiment: Buyers, 10:1) & $553.17/share (Volume Sentiment: Buyers, 1.92:1) price levels, with resistance at the $574.71/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

QQQ, the Invesco QQQ Trust ETF that tracks the NASDAQ 100 advanced +0.89% last week, having the strongest week of the major four index ETFs.

Their RSI looks similar to SPY’s in that it has begun to curl over & head downward following Friday’s declines & it currently sits at 61.55, while their MACD looks primed to cross the signal line bearishly in the coming week.

Volumes were also extremely weak for QQQ, coming in at -37.61% below the prior year’s average (26,442,000 vs. 42,380,464), as the tumbleweeds blew across the tech heavy index.

Much like SPY, QQQ’s average past year volume is -13.95% lower than it was back on March 31, 2024 (49,253,412).

QQQ’s week began in a similar fashion to SPY’s as Monday’s session resulted in a doji candle on the second weakest volume of the week, indicating that there was hesitancy on the part of market participants heading into a new week.

However, this all seemed to fade away for the next two days, but there was still downside appetite as shown by Tuesday’s candle’s lower shadow.

Tuesday opened higher day-over-day, but tested much lower down to the $480.17/share mark before rallying higher & closing the day on a slight advance.

It should be noted that Tuesday’s candle flashed an ominous signal though as the session closed in a hanging man candle, which was then confirmed by Wednesday’s session’s inability to test much higher.

Wednesday resulted in a shooting star candle, indicating that there was still trouble on the horizon for QQQ.

Thursday saw the highest volumes of the week, but like SPY the PBOC pump resulted in profit taking, lending to the week’s highest volume being for a session that opened higher, tested down to near Wednesday’s close before closing below the day’s opening price.

This set the stage for Friday’s risk-off heading into the weekend session where QQQ declined -0.56%.

It should be noted that this occurred on the lowest volumes of the week, but considering Thursday’s high volume & wide range of price action & ultimate lower close than opening price that may be a function of folks hopping out of the pool a day prior.

Thursday was not able to produce a new all-time nor a 52-week high which indicates that there is unlikely to be much along the lines of near-term upside appetite for QQQ.

QQQ looks ready to take a breather at minimum due to the inability to continue trudging higher last week & all eyes will be on the relationship between their price & the 10 day moving average’s support heading into the new week.

In the event the price breaks through it to the downside then we will likely see if continue further until it tests the 50 DMA’s support, as there is only one other support touchpoint between them ($474.88).

This is where things could become interesting as the $472-479.99/share price levels are Seller dominated over the past ~2 years (1.05:1 & 1.08:1) & the 50 DMA currently sits at $467.49/share & is rising.

The good news for bulls should this happen is that since July’s decline we have been making higher lows & there is a support zone between the 200 Day Moving Average at $446.61 to $448/share.

However, bears will be quick to point out that QQQ’s most recent peak was only +1.82% higher than the previous peak & the 200 DMA’s support was broken through temporarily in August, indicating that there is appetite to see that happen again.

As has been noted in previous weeks, QQQ has more support levels due to the steadier ascent they took since the Q4 2023 rally, particularly the prices from Q1 into Q2 2024.

QQQ has support at the $484.86 (Volume Sentiment: Buyers, 1.6:0*), $481.11 (10 Day Moving Average, Volume Sentiment: Buyers, 1.4:1), $474.88 (Volume Sentiment: Sellers, 1.08:1) & $467.49/share (50 Day Moving Average, Volume Sentiment: Buyers, 0.9:0*) price levels, with resistance at the $493.70 (Volume Sentiment: Buyers, 0.7:0*) & $502.81/share (All-Time High, Volume Sentiment: Buyers, 0.6:0*) price levels.

IWM, the iShares Russell 2000 ETF declined -0.56%, as the small cap index had the worst week out of the major four index ETFs.

Their RSI is currently at 58.29, while their MACD has flattened & looks ready to cross the signal line bearishly in the coming days.

Volumes were -35.95% below the previous year’s average (22,654,000 vs. 35,367,549), as market participants were not seeking risk & taking profits from the recent run up in small cap names.

Unlike SPY & QQQ, IWM’s average past year’s volume is now +3.18% above where it was back on 3/31/2024 (34,276,900).

This looks like complacency for investors in IWM & its components, given it was a week of moderate declines for IWM but less people were selling than normal.

IWM’s week kicked off Monday to more profit taking following Friday’s declining session & last Thursday’s hanging man candle that closed lower than it opened despite gapping up to open (bearish).

Tuesday threw mixed signals out, as the session closed as a hammer candle which can indicate that there is a reversal coming in the wake of declines like the ones that preceded it & it formed a bullish harami with the prior session’s candle.

However, caution should be taken as the session closed lower than it opened & the lower shadow shows that there was quite a bit of downside appetite that the bulls were able to at least temporarily fight back from.

Wednesday confirmed that there is bearishness in the air for IWM, as the session opened lower & continued to test lower, breaking down through the support of the 10 day moving average & closing beneath it.

Thursday opened on a gap up, tested slightly higher than it opened, but in the end the bears were able to force IWM’s price down to close below their opening price & in-line with the 10 DMA, echoing the bearish sentiment of the prior five sessions despite closing slightly up.

Friday was able to open slightly higher than Thursday & tested higher, breaking abvoe the $222.50-mark briefly before moving lower & testing down to the 10 DMA’s support.

Support held up & forced the close to be a spinning top candle, but it should be noted that the close was lower than the open, which carries bearish sentiment.

Friday had the second highest volume of the week as market participants were eager to remove risk before the weekend commenced.

This week will have the 10 DMA in focus, as it has so far proven to be sturdy but has shown signals of weakness & with repeated testing it seems that market participants are unsure if they want prices to remain above it or not for IWM.

In the event that it breaks down, the next support level is -2.33% lower at the 50 day moving average, which is currently ~2% above the next highest support level & moving higher.

With the hanging man candle from the previous Thursday’s session marking the recent high that is where to keep an eye on in the event prices break upwards, but based on last week’s price action it looks like IWM is ready to continue lower in the coming week.

IWM has support at the $219.55 (10 Day Moving Average, Volume Sentiment: Sellers, 3.3:1), $214.43 (50 Day Moving Average, Volume Sentiment: Buyers, 1.69:1), $210.57 (Volume Sentiment: Buyers, 2:1) & $208.58/share (Volume Sentiment: Buyers, 2:1) price levels, with resistance at the $221.69 (Volume Sentiment: Buyers, 2.86:1), $224.17 (Volume Sentiment: Buyers, 1.6:0*) & $227.85/share (52-Week High, Volume Sentiment: Buyers, 1.6:0*) price levels.

DIA, the SPDR Dow Jones Industrial Average ETF also finished the week up +0.57% like SPY & also had a week of very light volume too.

Their RSI is trending into overbought territory & currently sits at 67.2, while their MACD is still bullish but beginning to flatten out & their histogram has been waning the past three sessions.

This sign of weakness will likely lead to a bearish crossover of their signal line in the coming week.

As noted above, volumes were lackluster for DIA, coming in -23.91% below the previous year’s average volume (2,706,000 vs. 3,556,245), as it is looking like investors are running out of steam at their current price levels.

Like IWM, DIA’s current previous year’s average volume is actually higher than it was on 3/31/2024, coming in +4.44% above it’s late-March counterpart (3,405,069).

DIA’s week kicked off on uncertain footing, as Monday’s session ended in a doji on very light advancing volume.

Tuesday was another advancing session, but it resulted in a hanging man candle (bearish), which set the stage for the risk-off action that DIA saw on Wednesday’s bearish engulfing candle that went down to come near testing the support of their 10 day moving average.

Thursday saw volumes kick up a bit more, but opened just below the high end of Wednesday’s real body, tested lower & ultimately closed lower than it opened as a hanging man candle.

While Thursday also could be categorized as a bullish harami formation with Wednesday, the fact that it closed below its open diminishes the fact that it was an advancing session & it should be viewed as bearish sentiment.

This was confirmed on Friday, when DIA gapped up, tested above the $425/share price level, before closing as a shooting star candle for the day on the week’s highest volume.

The volume should be regarded as profit taking given the wide range of prices the day covered & that their open/close were both concentrated at the bottom of the session’s candle.

The first area to watch for this week with DIA will be the window that was formed by Friday’s session, as it is likely to fill earlier on in the week as Friday’s all-time high does not look to be on stable footing.

This will bring DIA to the support level of their 10 day moving average, which if broken through will open the door to support levels ~1% away from one another until DIA reaches the 50 DMA, which currently sits at $406.71.

Should this occur DIA’s next target will be a support zone between $399-398/share, but it will have the resistance of both the 10 & 50 DMAs applying downward pressure on price, while their 200 DMA’s support level is then only ~2.5% below ($389.02).

Of course, keep an eye on their volumes as well, as the more active market participants are in the coming price moves the stronger they will be.

In terms of what to watch for on the upside it is hard to say, given that Friday’s session set an all-time high, making it more important to have an understanding of what can happen to the downside & a plan of action for if this is to occur.

DIA has support at the $419.48 (10 Day Moving Average, Volume Sentiment: Buyers, 0.2:0*), $415.32 (Volume Sentiment: Buyers, 0.8:0*), $412.11 (Volume Sentiment: Buyers, 0.8:0*) & $406.71/share (Volume Sentiment: Buyers, 1.2:1) price levels, with resistance at the $426.20/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.

The Week Ahead

Monday kicks the week off with Fed Governor Bowman speaking at 8:50 am, followed by the Chicago Business Barometer (PMI) data at 9:45 pm & Fed Chair Powell speaking at 1:55 pm.

Carnival reports earnings before Monday’s opening bell.

S&P Final U.S. Manufacturing PMI data comes out at 9:45 am Tuesday, followed by ISM Manufacturing, Construction Spending & Job Openings data at 10 am, Fed Governor Cook speaking at 11:10 am & Fed Presidents Barkin, Bostic & Collins having a panel discussion about technology at 6:15 pm & Auto Sales data is also expected on Tuesday.

Tuesday morning’s earnings reports include Lamb Weston, Acuity Brands, McCormick, Paychex & United Natural Foods, with Nike, Cal-Maine Foods & Resources Connection reporting after the session’s close.

Wednesday features the ADP Employment data reports at 8:15 am, followed by Fed President Hammack speaking at 9 am, Fed Governor Bowman speaking at 11 am & Fed President Barkin speaking at 12:15 pm.

Conagra & RPM Inc. report earnings before Wednesday’s opening bell, with Levi Strauss due to report after the session’s close.

Initial Jobless Claims data is scheduled to come out Thursday morning at 8:30 am, followed by S&P Final U.S. Services PMI data at 9:45 am, ISM Services & Factory Orders data at 10 am & Fed Presidents Kashkari & Bostic having a discussion at 10:40 am.

Thursday morning begins with AngioDynamics & Constellation Brands reporting earnings, with Tilray Brands coming in after the closing bell.

Friday morning starts with U.S. Nonfarm Payroll, U.S. Unemployment Rate, U.S. Hourly Wages & Hourly Wages Year-over-Year data at 8:30 am, before Fed President Williams speaking at 9 am & Apogee Enterprises reports earnings before the session opens.

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 ***

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 ***