SPY, the SPDR S&P 500 ETF added +1.94% this week, while the VIX closed the week at 16.37, indicating an implied one day move range of +/-1.03% & an implied one month move range of +/-4.73%.
Their RSI is trending towards overbought levels at 62.74, while their MACD is bullish following Friday’s crossover.
Volumes were +1.77% higher than the prior year’s average (67,452,000 vs. 66,277,052), down sharply from the previous week, which is underwhelming in the wake of last week’s +39.15% higher than average session, indicting waning enthusiasm & perhaps a bit of reality setting in.
Monday the week opened on its second lowest volume on a gap up open above the resistance of the 10 day moving average & managed to grind higher throughout the day for a gain of +1.04%.
Tuesday opened just higher, but market participants were a bit uneasy & the day closed slightly lower as a doji candle, which when combined with the week’s lowest volume paints a picture of uncertainty & temporary complacency while awaiting more data & earnings news.
Wednesday echoed the uneasy feeling, as the session opened up in-line with Tuesday & from there the bottom fell out, and SPY temporarily dipped below the 10 day moving average’s support before recovering to still close the day down -0.52%.
Wednesday’s session was the highest volume of the week which should be noted, as Wednesday formed a bearish engulfing pattern with Tuesday’s candle & folks were clearly beginning to take the money & run.
Thursday opened slightly higher & was able to advance throughout the session, but still fell short of Wednesday’s opening price, while SPY moved further away from its 10 DMA’s support.
Friday opened on a gap higher & the second highest volume session of the week established a new all-time high heading into the weekend on intraday gains of +0.82%.
This raises many questions, as earnings reports continue to come in following the major banks last week & this week’s economic data features a number of reports that may not be available due to the government shutdown, as well as the FOMC decision which many folks see as being a .25 bps cut, which makes Friday’s gains look like front-running a quick profit.
SPY’s upside case continues to remain the same, in order to see lasting, higher results they’ll need to continue to see increased advancing volume that keeps pushing it higher in order to be sustainable; otherwise this has truly begun to look like a game of Jenga.
This is particularly true based on the week-over-week volume decline & Friday’s gap up heading into the weekend session, neither of which inspire a ton of confidence in the new all-time high.
The consolidation case moving forward continued to remain the same as well, where SPY hugs & oscillates around the 10 day moving average in a similar manners to what we’ve seen over three of the past four weeks, awaiting an upside or downside catalyst.
This week should be ripe for one, given that there is a high likelihood that much of the week’s economic data is not available, there are many anticipated earnings reports from various sectors that will lay insight into the state of U.S. consumers & businesses & there is the FOMC interest rate announcement coming Wednesday.
To the downside the risk becomes more interesting this week, particularly due to Friday’s gap up session heading into the weekend & the window that it created that will need to be filled.
What adds to this is that should the 10 DMA & the $673.95/share levels break down, the 50 day moving average’s support is now still in a Seller oriented zone where they’ve historically outnumbered Buyers 2.4:1 & the next support level falls in a price zone that has seen Sellers outnumber Buyers 1.57:1.
In the event of a breakdown like that, the next support level also resides in a Seller dominated zone (2:1), which brings all eyes down to -8.81% at $617.58/share, which happens to be the gatekeeper of the consolidation range of late 2024-early 2025 that houses many support levels.
That support zone is the gatekeeper to the window created in May of 2025 that has remained unfilled, but that’s looking a bit too far ahead at the moment.
SPY has support at the $673.95 (Volume Sentiment: Buyers, 2.5:1), $667.49 (10 Day Moving Average, Volume Sentiment: Buyers, 2.55:1), $656.88 (50 Day Moving Average, Volume Sentiment: Sellers, 2.4:1) & $653.17/share (Volume Sentiment: Sellers, 1.57:1) price levels, with resistance at the $678.47/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.
QQQ , the Invesco QQQ Trust ETF gained +2.18% for the week, as the tech-heavy index was not a favorite among market participants.
Their RSI is trending higher at 62.81, while their MACD is currently bullish following Friday’s crossover.
Volumes were +11.17% higher than the prior year’s average (48,450,000 vs. 43,582,231), as there was less market participant enthusiasm week-over-week, but the declining volume hints at a story brewing.
Monday the week kicked off on a gap up, breaking above the $610/share level.
Tuesday things began to show signs of trouble, as the session opened in-line with Monday’s close, but could only close as a doji for a day-over-day loss of -0.03% & market participants were clearly uneasy.
Wednesday opened lower & sank, temporarily breaking through the support of the 10 day moving average & showing that the short-term trendline was weak.
The week’s highest volume also took place on Wednesday, which indicates that there was a lot of profit taking being done, while also reflecting the pump that pushed prices back above the 10 DMA.
Thursday opened lower & in-line with the 10 day moving average, but was able to push higher to close just below Wednesday’s open, another sign of near-term weakness.
This was confirmed Friday when QQQ opened on a gap up, but closed the session as a spinning top candle on the week’s second highest volume.
While that volume tidbit would normally be the important part in a weekly review & paint a rosy picture of advancing volume heading into the weekend when many folks prefer to not carry risk, given the week-over-week decline in volume from +57.78% above the prior year’s average to just +11.17%, it shows a clear lack of demand.
The upside case for QQQ remains the same, in order to continue securing new all-time highs there will need to be sustained increases advancing volume before it can be trusted & until then should be met with a skeptical brow anytime we see a new all-time high at this rate.
The consolidation case, much like SPY’s is similar to that of the past few weeks, where QQQ will oscillated around the 10 day moving average & await an upside or downside catalyst.
To the downside, there is a heavy concentration of historic Buyer sentiment at QQQ’s first few support levels, but, the price zone just above the 50 day moving average (which is moving higher each day) is a Seller dominated zone (1.17:1).
Should QQQ drop below $595/share (which is only a decline of -3.58%) things become interesting, as the consolidation range of August 2025 becomes a support zone that comes into play just below another Seller dominated zone (3.14:1).
QQQ has more support from 2025 than SPY does, but the story will be similar, although likely with QQQ leading the charge.
Should that zone break down, the zone from December into February becomes the next support in focus.
QQQ has support at the $613.18 (Volume Sentiment: Buyers, 1.17:1), $606.22 (10 Day Moving Average, Volume Sentiment: Buyers, 2.2:0*), $590.41 (50 Day Moving Average, Volume Sentiment: Buyers, 1.04:1) & $590.13/share (Volume Sentiment: Buyers, 1.04:1) price levels, with resistance at the $618.42/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.
IWM, the iShares Russell 2000 ETF advanced +2.47%, as the small cap index led the week in gains.
Their RSI is trending higher, currently at 58.06, while their MACD is bearish, but making a run at the signal line, which will likely only amount to a dolphin, where the signal line is temporarily broken through & then dove right back beneath.
Volumes were -2.06% lower than the prior year’s average (32,138,000 vs. 32,814,462), which should be curious to everyone, given that the small cap index led the four majors in weekly gains.
Monday led the week off on a gap up above the 10 day moving average’s resistance for IWM, but not establishing firm footing for support higher.
Tuesday formed a bearish harami pattern with Monday’s session, with the day’s lower candle touching off of the support of the 10 DMA.
Wednesday showed that there was conviction behind this move, as IWM opened on a gap down, struggled higher temporarily, before ultimately plunging below the 10 DMA’s support, with the day’s lower show indicating that there was a lot of profit taking & comfort with downside movements & that the 50 day moving average’s support was in play.
This wild intraday movement accounted for the highest volume of the week.
Thursday opened higher, broke out above the 10 day moving average before settling down to close just above it.
Friday cast an ominous shadow on the small cap index, as the gap up open closed to resemble a gravestone doji (bearish), and the advancing volume was the second lowest volume of the week.
Additionally, the window itself that was created by the move also now features the 10 day moving average moving through it, which we’ll look at in a moment.
The upside case for IWM resembled that of SPY & QQQ & what we’ve said for weeks, the all-time high train can only continued with higher participation if it wants to be viewed as safe.
The consolidation case will involve oscillations around the 10 day moving average or straddling atop it, while we await an upside or downside catalyst.
To the downside things get murky as IWM’s first two support levels lack enough data for a Buyer:Seller ratio, and a breakdown leads to a breakdown in the short-term trend.
While IWM has more clusters of support locally vs. its larger cap counterparts, it is going to move in tandem with them, so a breakdown of any of them will lead to a breakdown of IWM.
Watch the 50 day moving average, for if it breaks down the $235.99/share level is Seller dominated (1.03:1), but walks IWM lower until the $228.90/share support level (-8.23% from Friday’s close).
IWM has support at the $248.48 (Volume Sentiment: NULL, 0:0*), $246.54 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*), $240.76 (Volume Sentiment: Buyers, 2.19:1) & $239.54/share (50-Day Moving Average, Volume Sentiment: Buyers, 1.56:1) price levels, with resistance at the $252.77/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.
DIA, the SPDR Dow Jones Industrial Average ETF trudged +2.26% higher on the week, as the blue chip index was in second highest demand of the week.
Their RSI is trending higher at 63.68, while their MACD broke out bullishly on Friday & will be interesting to watch to see if it can continue higher or if it dolphins back below the signal line this week.
Volumes were +63.32% higher than the prior year’s average (6,096,000 vs. 3,732,590), as the blue chip index remained the most resilient of the majors by participation rate, but, the highest volume session of the week came on Wednesday on a decline, which raises questions.
Monday the week began on a gap up open above the 10 DMA’s resistance, but the move lacked power due to the lowest volume of the week.
Tuesday opened on a gap higher, retraced into Monday’s range, but managed to Garner support & rip higher, temporarily crossing the $470/share level, but profits taking set in & ultimately DIA settled +0.48% day-over-day.
Wednesday that profit taking set in in full-force, as the session opened up one penny below Tuesday’s, and continued to tank throughout the day on the week’s highest volume, signaling that people wanted their profits, and fast.
Thursday opened lower & made a test towards the 10 DMA’s support, but ultimately the bulls came back into the room & forced a day-over-day gain of +0.32%, which brings us to a fork in the road.
This occurred on the second lowest volume of the week, indicating that there was not much upside appetite at all at the end of the day & perhaps folks were just buying at a discount after selling in the prior couple of days.
Running with that sentiment, the lackluster performance of participants showing up vs. the rest of the week signals that we’re likely approaching the top levels of the diving board.
Friday didn’t do much else beyondconfirming this, as a gap up open on the second highest volume of the week sent DIA into the weekend +1.05% on the day.
Given the 100%+ volume over the prior year’s average of last week & this week’s +63.32% higher rate, DIA’s +2.26% gains for the week seem cheap, particularly if a +1.05% advance came on Friday two days after a high volume decline day.
The blue chip index will continue higher like the rest of the majors mentioned before, perhaps more handsomely, but while relying on the same underlying thesis of attaining more all-time highs safely will involve consistent volume.
Even thought they’ve experienced elevated volume, the consistency is lacking & it’s tough to trust moves higher from here, even though most of the owners of the component names are looking at it through “buy & hold” goggles.
The consolidation case is the same as IWM’s, look to see straddling of/oscillations around the 10 day moving average while we await an upside or downside catalyst.
To the downside, all eyes should be on the 10 DMA’s support first, as if the short-term trend is violated the medium-term terndline comes next at ~1% lower.
Given the buy & hold nature of the index, a bank run on DIA components will easily push prices below the 50 DMA’s suport, which introduces us to a Seller’s zone of $452-455.99/share, and then exposes open range of field between support levels & may even draw into play the 200 Day moving average, but that’s for the next week(s) to decide.
DIA has support at the $470.22 (Volume Sentiment: NULL, 0:0*), $464.83 (10 Day Moving Average, Volume Sentiment: Buyers, 1.9:1), $459.11 (50 Day Moving Average, Volume Sentiment: Buyers, 1.44:1) & $454.41/share (Volume Sentiment: Sellers, 1.1:1) price levels, with resistance at the $473.24/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.
The Week Ahead
Durable Goods Orders & Durable Goods minus Transportation data come out Monday at 8:30 am, unless the government shutdown persists causing it to be delayed.
Monday morning’s earnings reports include Bank of Hawaii, Carter’s, Easterly Government Properties, Keurig Dr. Pepper, Lakeland Financial & Revvity, before Agilysys, Alexandria RE, Ameris Bancorp, Amkor, Arch Capital, Avis Budget, Bed Bath & Beyond, BioMarin Pharmaceutical, Brown & Brown, Cadence Design, Celestica, Cincinnati Financial, Confluent, Crane, Custom Truck One Source, Dorman Products, F5 Networks, FTAI Aviation Ltd., Hartford Financial, Kilroy Realty, Leggett & Platt, Noble Corporation, Northwest Bancshares, NOV Inc., Nucor, NXP Semiconductor, Olin, Piedmont Office Realty Trust, Principal Financial, Ramaco Resources, Rambus, Seacoast Banking, Simpson Manufacturing, Universal Health, Waste Management, Welltower & Whirlpool after the closing bell.
Tuesday brings us S&P Case-Shiller Home Price Index (20 Cities) data at 9 am, before Consumer Confidence data at 10 am.
A.O. Smith, Alkermes Plc, American Tower, Applied Industrial, Ares Capital, Armstrong World Industries, Asbury Automotive, ATI Inc., Axalta Coating Systems, BrightSpring Health Services, Carrier Global, CECO Environ., Check Point Software, Commvault Systems, Corning, Curbline Properties, D.R. Horton, Ecolab, Franklin Electric, Group 1 Auto, Herc Holdings, HNI, Hope Bancorp, Hubbell, Incyte, Invesco, IQVIA, JetBlue Airways, Labcorp Holdings Inc., MSCI, NeoGenomics, New Oriental Education & Technology, NextEra Energy, PayPal, PHINIA, Polaris Industries, Regeneron Pharma, Repligen, Royal Caribbean, Sherwin-Williams, Smithfield Foods, SoFi Technologies, Sysco, Tenet Healthcare, Trimas, UnitedHealth, UPS, V.F. Corp, Wayfair, Xylem & Zebra Tech report earnings Tuesday morning, followed by Acadia Realty Trust, Amrize, Artisan Partners Asset Mgmt, Bank of N.T. Butterfield & Son, Bloom Energy, Booking Holdings, BXP, Inc., Caesars Entertainment, Camping World, Cheesecake Factory, Chemed, CoStar Group, Edison, Electronic Arts, Enphase Energy, Equity Residential, ExlService, Expand Energy, First Commonwealth, Flowserve, Four Corners Property Trust, Frontier Communications Parent, GeneDx, Greenbrier, Highwoods Prop, Huron Consulting, Landstar System, Meritage, Mirion Technologies, Modine Manufacturing, Mondelez Int’l, MSA Safety, Nabors Industries, Neurocrine Biosciences, ONEOK, PPG Industries, Range Resources, Red Rock Resorts, Regency Centers, RenaissanceRe, Renasant, Seagate Tech, Sensata Tech, Stride, Teradyne, Ternium S.A., Titan America, Trustmark, Ultra Clean Holdings, UMB Financial Corporation, Varonis Systems, Veralto, Visa, VSE Corp, W.P. Carey & Zurn Elkay Water Solutions after the session’s close.
Advanced U.S. Trade Balance in Goods, Advanced Retail Inventories & Advanced Wholesale Inventories data comes out Wednesday at 8:30 am, pending that the government shutdown does not cause it to be delayed, followed by Pending Home Sales data at 10 am, the FOMC Interest-Rate Decision at 2pm & Fed Chair Powell’s Press Conference at 2:30 pm.
Wednesday morning begins with earnings reports from AerCap, American Electric, Archrock, Automatic Data, Avantor, Avnet, Bausch + Lomb, Blackbaud, Boeing, Brinker, Caterpillar, Centene, Chart Industries, Chefs’ Warehouse, Clarivate, Clean Harbors, Constellium, Criteo, CVS Health, Dana Inc, Donnelley Financial, Entergy, ESAB Corp., Etsy, Evercore, Extreme Networks, Fiserv, Flex, Fortive, Fresh Del Monte, Garmin, Gates Industrial, GE HealthCare, Generac, Gildan Activewear, GlaxoSmithKline, Hayward Holdings, IDEX Corp, Ionis Pharma, ITT, Kirby, Kraft Heinz, Leonardo DRS, Littelfuse, Masco, Materion, MGP Ingredients, Monro Muffler, Navient, NiSource, OGE Energy, Old Dominion, OneSpaWorld, Oshkosh, Otis Worldwide, Penske Auto, Phillips 66, ProPetro, Prosperity Bancshares, Radware, Reynolds Consumer Products, Silgan Holdings, SiteOne Landscape Supply, Smurfit Westrock plc, Stepan Company, TE Connectivity, The Vita Coco Company, Timken, TriNet Group, UBS AG, United Therapeutics, Verisk Analytics, Verizon, Virtu Financial & Watsco, before Alphabet, Agnico-Eagle Mines, Alamos, Align Tech, Allison Transmission, American Homes 4 Rent, American Water Works, Antero Midstream, Antero Resources, AtriCure, AvalonBay, AXIS Capital, Bio-Rad Labs, Boot Barn Holdings, C.H. Robinson, Cactus, Calix Networks, Canadian Pacific Kansas City Ltd., Carlisle Cos, Carvana, CBIZ, Chipotle Mexican Grill, Coeur Mining, Cognex, Cognizant Tech, Cohu, CVR Energy, DaVita, Dayforce, DHT, eBay, Encompass Health, EPR Properties, Equinox Gold, Essex Property, Ethan Allen, Everest Group, Extra Space Storage, First Interstate Bancsystem, FMC Corp, FormFactor, Glaukos, Green Brick Partners, Guardant Health, Hanover Insurance, Impinj, Independence Realty Trust, Invitation Homes, KLA Corporation, Magnolia Oil & Gas, MediaAlpha, MercadoLibre, Meta Platforms, Methanex, MGIC Investment, MGM Resorts, Microsoft, Mid-America Aptmt, Mister Car Wash, Moelis, Murphy USA, MYR Group, NETGEAR, NorthWestern, Opko Health, Pilgrim’s Pride, Pitney Bowes, Provident Finl, Prudential, Public Storage, Regal Rexnord, Rollins, Rush Enterprises, Rush Street Interactive, ServiceNow, Skyward Specialty Insurance Group, Sprouts Farmers Market, STAG Industrial, Starbucks, Sun Communities, Teekay Tankers, Teladoc, Tenable, TransMedics Group, Transocean, TTM Tech, Tyler Tech, Udemy, UDR, UFP Industries, Ventas, Verra Mobility, Viavi, Waystar Holding Corp., WEX & Wolfspeed report their earnings after the closing bell.
Thursday begins with Initial Jobless Claims (pending on whether it is delayed due to government shutdown) & GDP data at 8:30 am, before Fed Vice Chair of Supervision Bowman speaks at 9:55 am.
Advance Auto Parts, Allegro Microsystems, Alnylam Pharma, Altria, Ameriprise Financial, Ametek, Apellis Pharmaceuticals, APi Group, Aptiv, Baxter, Belden, Biogen, BorgWarner, Bristol-Myers, California Water, Cardinal Health, CCC Intelligent Solutions, Cheniere Energy, CMS Energy, CNX Resources, Columbus McKinnon, Comcast, Commscope, Crocs, Cullen/Frost, Cushman & Wakefield, DigitalBridge, DT Midstream, DTE Energy, Eagle Materials, Eli Lilly, EMCOR Group, Entegris, Enterprise Products, Estee Lauder, Federal Signal, Ferrari, FirstCash, Fox Corporation, Genesis Energy, L.P., Gibraltar Industries, Hershey Foods, HF Sinclair, Hilton Grand Vacations, Howmet Aerospace, Huntington Ingalls, IdaCorp, Insight Enterprises, Insmed, Int’l Paper, Integra, Intercontinental Exchange, InterDigital, Itron, Janus Henderson Group, KBR, Kellanova, Kimberly-Clark, Kimco Realty, L3Harris, Laureate Education, LCI Industries, Lincoln Electric, Lincoln National, LKQ, LXP Industrial Trust, Malibu Boats, Mastercard, Medical Property Trust, Merck, Newmark Group, NovoCure, Omnicell, Option Care Health, Patrick Industries, PBF Energy, Peabody Energy, Quanta Services, Restaurant Brands Int’l, Roblox, RPC, S&P Global, Saia, Schneider National, Scorpio Tankers, Shake Shack, Sirius XM, Southern, The Cigna Group, Thryv, Tradeweb Markets, Trane, Trinity Industries, Upbound Group, Utz Brands, Valaris, Vontier, Vulcan Materials, Wabash Natl, WEC Energy Group, Wesco, Westlake Corporation, Willis Towers Watson, Xcel Energy & XPO, Inc. host their earnings calls Thursday mornings, followed by Amazon.com, Apple, Adtalem Global Education, Alignment Healthcare, Alkami Technology, Alphatec, AppFolio, AptarGroup, Arcosa, Ardelyx, Arrow Electronics, Arthur J. Gallagher, Atlassian, Axos Financial, BJ Restaurants, Bright Horizons, Casella Waste, Cloudflare, Coinbase Global, Columbia Banking, Columbia Sportswear, COPT Defense Properties, Cousins Prop, CubeSmart, Dexcom, DXC Technology, Edwards Lifesciences, Employers Holdings, Exponent, Federated Hermes, First Solar, Floor & Decor, Fortune Brands Innovations, Gaming and Leisure Properties, Gilead Sciences, GoDaddy, Grid Dynamics, Healthcare Realty, Hercules Capital, Houlihan Lokey, Hub Group, ICF International, Illumina, Ingersoll-Rand, iRhythm, LendingTree, LPL Financial, Lumen Technologies, MasTec, Merit Medical, Monolithic Power, Motorola Solutions, Omega Health, Park Hotels & Resorts, PriceSmart, Quaker Chemical, Reddit, Reinsurance Group of America, Republic Services, ResMed, Rocket Companies, Roku, Ryan Specialty Group, Savers Value Village, Select Medical, Silicon Motion, SkyWest, SPS Commerce, SPX Technologies, Strategy Inc, Stryker, Twilio, VICI Properties, Werner Enterprises, Western Digital, Weyerhaeuser & Zillow after the closing bell.
Employment Cost Index, Personal Income, Personal Spending, PCE Index, PCE (Year-over-Year), Core PCE Index & Core PCE (Year-over-Year) are all scheduled for release Friday at 8:30 am (pending the government shutdown does not force them to be delayed), before Fed President Logan Speaks at 9:30 am, Chicago Business Barometer (PMI) data comes out at 9:45 am & Fed Presidents Hammack & Bostic speak at 12 pm.
Friday morning’s earnings calls include AbbVie, AGCO Corp, Aon, Canadian Nat’l Rail, Cboe Global Markets, Cenovus Energy, Charter Communications, Chevron, Church & Dwight, Colgate-Palmolive, Dominion Energy, Exxon Mobil, Federal Realty, Grainger, Imperial Oil, Interface, Lear, Linde plc, LyondellBasell, Magna, Newell Brands, nVent Electric, Oil States, OneMain Holdings, Owens & Minor, Piper Sandler, Portland Gen Elec, Protolabs, RBC Bearings, Sensient, T. Rowe Price, Telus, Terex, WisdomTree & Xenia Hotels.
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 ***