SPY, the SPDR S&P 500 ETF fell -2.41% last week, while the VIX closed the week out at 20.38, indicating an implied one day move of +/-1.28% & an implied one month move of +/-5.89%.
Their RSI has just crossed down below the neutral 50 level & sits at 47.89, while their MACD is still bearish, as it was for most of the month of July.
Volumes were +43.87% higher than the prior year’s average (87,878,000 vs. 61,080,680), which should be cause for concern given that the declining volumes increased day-over-day throughout the week.
Monday the week began on a bearish note, as the week’s lowest volume session resulted in a decline & a doji candle, indicating that market participants were on edge, and awaiting more earnings reports, the FOMC rate decision & other economic data before making any sudden movements.
Tuesday the bearishness continued, as SPY opened higher, before declining throughout the session to ultimately form a bearish engulfing pattern on slightly higher volume than Monday’s session.
Wednesday the theme continued, but there was a test of the support of the 10 day moving average, while momentarily broke down before SPY was able to recover to close down -0.13% for the day, resulting in a spinning top candle which signals that there was indecision among market participants.
Following Wednesday’s unchanged FOMC interest rate decision & more earnings coming in Thursday opened on a gap higher, before sliding lower & ultimately taking out the support of the 10 day moving average, closing beneath it & forming a bearish engulfing pattern.
Friday confirmed that the bears had come out to play & that there was no risk appetite heading into the weekend when SPY opened on a gap down & continued lower, with the day’s low briefly dropping to $619.29/share, before closing at $621.72, a day-over-day decline of -1.64%.
Heading into the coming week, there is a new upside case emerging, where the resistance of the 10 day moving average will need to be broken through to see SPY continue higher, where it will test its all-time high set by Thurday’s session’s high.
The consolidation case for the time being involves SPY oscillating back & forth between the 10 & 50 day moving averages awaiting an upside or downside catalyst.
In the event that the support of the 50 day moving average breaks down, things get a bit murkier, leading to the declining case.
In the event that this brings price down to the neighborhood of $603.41 then we will likely see the window created in late June close, which then sets all eyes on the support of the 200 day moving average.
In that set up, the 10 & 50 day moving averages would be bearing down on SPY’s price & they’d be priced in the neighborhood to close the gap that was created in early May 2025 that is still unfilled.
The 200 day moving average is -5.81% below Friday’s closing price, but the $590-599.99/share level has sparse support levels, which may make it easier to be passed through quickly.
The table below lays out SPY’s volume sentiment historically from the past few years & can be referenced in the event of the re-tests mentioned above in order to assess the strength/weakness of support/resistance levels.
SPY has support at the $610.59 (50 Day Moving Average, Volume Sentiment: NULL, 0:0*), $609.59 (Volume Sneimtent: Buyers, 2.6:1), $607.15 (Volume Sentiment: Buyers, 2.6:1) & $603.42/share (Volume Sentiment: Buyers, 7:1) price levels, with resistance at the $632.38 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $639.85/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.
QQQ, the Invesco QQQ Trust ETF dipped -2.21%, as investors in the tech-heavy index were slightly less inclined to sell, but were still clearly on the fence about the near-term.
Their RSI also has just come crashing back to below the neutral 50-mark & sits at 48.34, while their MACD is also still bearish, having spent most of the month of July below the signal line.
Volumes were +28.18% higher than the prior year’s average (50,880,000 vs. 39,692,640), mostly due to the last two sessions of the week, indicating that there is risk-off sentiment in the market for QQQ.
Monday kicked the week off on a similar (but slightly less pessimistic) manner as SPY, as a gap up open resulted in a lower close & a thick doji candle for QQQ.
Tuesday followed suit & on another low volume session a gap up saw a slightly advance, before crumbling lower to form a bearish engulfing candle for the day.
Wednesday opened in Tuesday’s range, testing slightly higher & lower as shown by the upper & lower shadows on the day’s candle, before ultimately closing lower than the open & forming a bearish harami pattern with Tuesday’s candle.
Thursday is where market participants really stepped up, as QQQ opened on a gap up, made a fresh all-time high, before diving lower to form a bearish engulfing candle that closed straddling the 10 day moving average’s support.
Friday saw the tipping point, where QQQ opened on a gap lower & continued lower throughout the day, although they were able to regain some losses before the session’s close based on the lower shadow.
QQQ’s near-term outlook is similar to SPY’s, with their upside case hinging upon being able to break out above their 10 DMA’s resistance; until that happens there’s not much to talk about.
Should it occur, we’re then off to try to break out above their all-time high, which will require the same high, sustained advancing volume that’s been mentioned over the past month.
The consolidation case is also the same as SPY’s, QQQ in that situation will oscillate around between the 10 & 50 day moving averages awaiting an upside or downside catalyst.
QQQ’s downside case is also quite similar to SPY’s; should the 50 day moving average’s support break down, $536.27 will be the price to watch, as if QQQ reaches it we’ll see the window created in late June close.
After that, the 200 day moving average will be in focus, which is currently -7.97% below Friday’s closing price.
Should that show weakness or break down, all eyes should be directed towards the window created in mid-May.
QQQ has support at the $542.66 (50 Day Moving Average, Volume Sentiment: NULL, 0:0*), $539.40 (Volume Sneimtent: Buyers, 3.67:1), $536.88 (Volume Sentiment: Buyers, 3.67:1) & $532.43/share (Volume Sentiment: Buyers, 3:1) price levels, with resistance at the $564.29 (10 Day Moving Average, Volume Sentiment: NULL, 0:0*) & $574.63/share (All-Time High, Volume Sentiment: NULL, 0:0*) price levels.
IWM, the iShares Russell 2000 ETF declined -4.22%, as the small cap index had the worst week of the major four index ETFs.
Their RSI has also crossed below the neutral 50 mark & sits at 41.43, while their MACD continues lower with its histogram signaling that there is likely further declines on the horizon.
Volumes were +37.26% higher than the prior year’s average (41,860,000 vs. 30,497,320), which signals that there is severe discomfort among the small cap names currently, as every session of the week resulted in declining candles.
Monday the small cap investors went straight to the point compared to SPY & QQQ investors, as the session resulted in a bearish engulfing candle whose low just barely stayed above the support of the 10 day moving average.
Tuesday opened higher, before forming a bearish engulfing pattern on Monday’s candle & closing below the support of the 10 day moving average.
Wednesday opened in-line with the 10 DMA, briefly tested higher reaching as high as $224.93/share, but ultimately dipped lower to close below the 10 day moving average & the lower shadow on the day’s candle indicates that there was appetite for IWM to trade below $220/share.
It is also worth nothing that Wednesday’s volume was near Monday & Tuesday’s combined levels, so between profit taking & fleeing to safety a lot of shares were changing hands, a trend that only continued throughout the week.
Thursday the pain continued, when IWM opened on a gap down, attempted to climb back to the 10 DMA’s resistance, but was stopped short & slid for a loss of -0.98% day-over-day.
Friday the bears were on parade for IWM, as the ETF opened on a gap lower, hardly tested much higher, before breaking down to go as low as $212.34/share & to close down -2.04% for the day on the week’s highest volume as everyone was jumping out of the pool.
This is somewhat to be expected among the small cap names following the performance of SPY & QQQ, but it should be noted that IWM closed below both its 50 & 200 day moving averages, which are both well below their 10 DMA.
This breakdown of the medium & long-term trend lines will be an area of focus in the coming week, but the overall direction of IWM will most likely be determined by the direction that the other 3 major indexes move in.
Upside case as shown below requires the $216.91/share level to be broken & sustained above before it carries any water, particularly given the amount of resistance levels in the $215-217 price range & the historic Seller oriented historic price movements at these levels.
The consolidation case looks to be oscillations around the 200 DMA while awaiting an upside or downside catalyst.
To the downside, the $209.55 & $208.69/share price levels will be key to watch in the coming week if there is a downside catalyst for IWM.
In the event of a breakdown of these two levels, there are only two support levels between the price & the $199.01/share support levels, which opens IWM up for potentially large losses in the near-to-mid-term.
IWM has support at the $212.90 (2 Touch-Points, Volume Sentiment: Sellers, 1.89:1), $209.55 (Volume Sentiment: Buyers, 1.9:1), $208.69 (Volume Sentiment: Buyers, 1.9:1) & $206.81/share (Volume Sentiment: Buyers, 1.11:1) price levels, with resistance at the $215.16 (50 Day Moving Average, Volume Sentiment: Sellers, 1.89:1), $215.22 (200 Day Moving Average, Volume Sentiment: Sellers, 1.89:1), $215.34 (Volume Sentiment: Sellers, 1.89:1) & $215.65/share (Volume Sentiment: Sellers, 1.89:1) price levels.
DIA, the SPDR Dow Jones Industrial Average ETF lost -2.96% last week, as even the blue chip names were unable to escape the week unharmed.
Their RSI has also dipped through the neutral 50 mark to the downside & is currently at 42.44, while their MACD is continuing to move more bearishly from the signal line.
Volumes were +24.3% higher than the prior year’s average (3,996,000 vs. 3,214,760), which is cause for concern given that each session of the week was a decline & each’s volumes got progressively higher day-over-day.
Monday opened the week up with a bearish harami cross on weak volume, setting the stage for more declines to come.
Tuesday opened higher but closed down in-line with the 10 day moving average’s support, forming a bearish engulfing candle with Monday’s on slightly higher volume.
Wednesday saw a breakdown of the 10 day moving average’s support, with an appetite to continue lower based on the session’s lower shadow.
Thursday opened in line with the 10 DMA, before proceeding lower & setting the stage for Friday’s high volume gap down open that continued lower to close the day out -1.27%, while also temporarily breaking down the 50 day moving average intraday.
The upside case for DIA is going to focus on the 10 DMA’s resistance to begin; if it can’t be broken through then expect a move lower, if it can be broken through, then the breaking the all-time high case of the past month is back in place.
Consolidation looks like oscillations between the 50 & 200 day moving averages as we await an upside or downside catalyst.
Like IWM, the downside case now relied heavily upon the strength of the support of the 200 DMA, as if the long-term trendline breaks down there is a bit of Seller pressure in two of the immediate three price zones below it & sentiment is already souring based on the increasing day-over-day declining volume trend of last week.
DIA has support at the $434.00 (50 Day Moving Average, Volume Sentiment: Buyers, 2.5:1), $430.10 (Volume Sentiment: Sellers, 1.43:1), $428.13 (Volume Sentiment: Sellers, 1.43:1) & $427.27/share (Volume Sentiment: Buyers, 4.5:1) price levels, with resistance at the $439.66 (Volume Sentiment: Buyers, 1.71:1), $445.14 (10 Day Moving Average, Volume Sentiment: Buyers, 14:1), $446.54 (Volume Sentiment: Buyers, 14:1) & $446.82/share (Volume Sentiment: Buyers, 14:1) price levels.
The Week Ahead
Monday the week begins with Factory Orders data at 10 am.
Palantir Technologies, BioCryst Pharma, BioNTech, Bruker, CNA Financial, Energizer, Freshpet, IDEXX Labs, Krystal Biotech, onsemi, TG Therapuetics, Tower Semi, Transocean, Tyson Foods, Waters & Wayfair all report earnings before Monday’s opening bell, followed by Addus HomeCare, ADTRAN, Aecom Tech, Air Lease, Allegiant Travel, Allison Transmission, Ameresco, Andersons, Ardelyx, Atlas Energy Solutions, Axon, B&G Foods, BellRing Brands, BioMarin Pharmaceutical, BWX Technologies, Cabot, Corebridge Financial, Coterra Energy, Denny’s, Diamondback Energy, Dorman Products, Douglas Dynamics, Encompass Health, Equity Residential, EverQuote, Golub Capital, Helios Technologies, Hims & Hers Health, IAC Inc., ICHOR Corporation, Ingevity, Inspire Medical Systems, JBT Marel Corporation, Kyndryl, Lattice Semi, LTC Properties, Marriott Vacations, MSA Safety, Mueller Water, National Storage Affiliates, Navitas Semiconductor, New Mountain Finance, NJ Resources, ODDITY Tech Ltd., Olo Inc., ONEOK, Otter Tail Power, Palantir Technologies, Palomar Holdings, Paymentus, Primoris Services, Ryman Hospitality, Sabra Health Care REIT, SBA Comm, Simon Properties, Syndax Pharmaceuticals, Tanger Factory, Tidewater, Trex, UFP Technologies, V2X, Vertex Pharma, Vimeo, Viper Energy Partners, Vornado Rlty Trust, Voyager Technologies, Williams Cos & ZoomInfo after the session’s close.
U.S. Trade Deficit Data comes out at 8:30 am on Tuesday, before S&P Final U.S. Services PMI data at 9:45 am & ISM Services data at 10 am.
Tuesday morning’s earnings reports include AdaptHealth, ADM, Alight, Apollo Global Management, Aramark, Atkore International, Avanos Medical, Axcelis Tech, Azenta, Ball Corp, BP, Broadridge Financial, Camtek, Caterpillar, Clear Secure, Cummins, Cushman & Wakefield, DigitalOcean, Driven Brands, Duke Energy, DuPont, Easterly Government Properties, Eaton, Edgewell Personal Care, Embraer SA, Enpro Inc., Enviri Corporation, EVgo Inc., Expeditors Intl, Fidelity Nat’l Info, First Watch Restaurant Group, Fox Corporation, Frontdoor, Frontier Group Holdings, Gartner, Hamilton Lane, Harmony Biosciences, Henry Schein, Hillman Solutions Corp., IPG Photonics, J&J Snack Foods, Jacobs Solutions, Knife River Corp., LCI Industries, Leidos, Lemonade, LGI Homes, Life Time, Madrigal Pharmaceuticals, Marathon Petroleum, Marriott, Molson Coors Brewing, MPLX LP, NNN REIT, Northwest Natural, Novanta, Oaktree Specialty Lending Corp, Ocular Therapeutix, Organon, Pediatrix Medical Group, Pfizer, Portillo’s, Public Service, Recursion Pharmaceuticals, Rhythm Pharmaceuticals, Sally Beauty, Sealed Air, Shift4 Payments, Shoals Technologies, Silicon Labs, Spire, Sportradar Group AG, Stevanato Group S.p.A., Surgery Partners, TopBuild, Transdigm Group, UL Solutions Inc., Uniti Group, Westlake Corporation, WK Kellogg Co, Xometry, Yum China, Yum! Brands, Zebra Tech & Zoetis, before 8×8, A10 Networks, Acadia Healthcare, Adaptive Biotechnologies, Advanced Energy, Advanced Micro Devices, Aflac, Agilon Health, American Fincl, Amgen, Angi Inc., Arista Networks, Assurant, Astera Labs, BlackLine, BridgeBio Pharma, Cadre Holdings, California Resources, Centrus Energy, Chemours, Cirrus Logic, Clearway Energy, Coupang, DaVita, Devon Energy, DoubleVerify, Douglas Emmett, Elme Communities, Equitable Holdings, Evolus, Flywire, Grocery Outlet, GXO Logistics, Halozyme Therapeutics, Hinge Health, Innospec, Innovex International, Interparfums, Intl Flavors, Jackson Financial, Jazz Pharma, JELD-WEN, Kemper, Klaviyo, Lemaitre Vascular, Limbach, Lucid Group, Masimo, Match Group, MNTN, Inc., Mosaic, News Corp., Noble Corporation, ONE Gas, Opendoor Technologies, OUTFRONT Media, Pacira BioSciences, Par Pacific, Paylocity, Powell Inds, Qiagen, Qualys, QuidelOrtho, Regal Rexnord, Resideo, Revolve Group, RingCentral, Rivian Automotive, Safehold, Select Water Solutions, SITE Centers, Skyline Champion, Skyworks, Snap, Stride, Suncor Energy, Super Micro Computer, Supernus Pharma, Teradata, The Baldwin Group, Toast, Ultragenyx Pharma, Upstart, Vestis, Viasat, Voya Financial & Zeta Global report following the session’s close.
There is no major economic data scheduled for release on Wednesday.
Wednesday morning features earnings from ACM Research, Adient, Avista, Avnet, Barrick Mining, Bentley Systems, BeOne Medicines, Bio-Techne, Bloomin’ Brands, Brinks, Capri Holdings, Carlyle Group, CDW, Cencora, Charles River, Choice Hotels, Conduent, Dave, Inc., Dayforce, Delek US Holdings, Dine Brands, DNOW Inc., Dynatrace, Emerson, ESAB Corp., Extreme Networks, Fortrea, Genius Sports, Geron, Gibraltar Industries, Global Payments, International Seaways, Iron Mountain, Jones Lang LaSalle, Kennametal, Kornit Digital, Lantheus Holdings, Lineage, LivaNova, Louisiana-Pacific, Magnera Corporation, MarketAxess, McDonald’s, Middleby, MRC Global, National Vision, New York Times, NiSource, Nomad Foods, Novavax, NRG Energy, ODP Corporation, Oscar Health, Owens Corning, Parsons, Payoneer, Perrigo, Pinnacle West, Planet Fitness, Rockwell Automation, Scholar Rock, Shopify, Six Flags Entertainment, Starz Entertainment Corp, Sunoco LP, Sunstone Hotel, Thomson Reuters, TPG Inc., Trimble, Unity Software, Valvoline, Vertex, Vishay, Walt Disney, Wix.com, Wolverine & XPEL, before ACADIA Pharmaceuticals, ADMA Biologics, Airbnb, Alpha and Omega Semi, Amdocs, American Intl, American States Water, Amplitude, AppLovin, Atmos Energy, B2Gold, Barrett Business, Beyond Meat, Blue Bird, BrightView, Bumble, CACI Intl, Capital Southwest Corp., CareDx, Central Garden, Certara, CF Industries, Chord Energy, Civitas Resources, Clearwater Analytics, Coeur Mining, Copa Holdings, CoreCivic, Corpay, Corteva, Crane NXTC, CRH Plc., CSG Systems, Curtiss-Wright, Deluxe, DHT, Digi Intl, DoorDash, DraftKings, Duolingo, Dutch Bros, e.l.f. Beauty, Encore Capital, Energy Transfer, Enersys, EverCommerce, Exact Sciences, Fastly, Federal Realty, Fidelity National, Fortinet, FS KKR Capital, Genco Shipping & Trading, GoodRx, Grand Canyon Education, Hecla Mining, Herbalife Nutrition, Horace Mann, Howard Hughes Holdings, HubSpot, Informatica, IonQ, Jack In The Box, Joby Aviation, Kinetik, Kulicke & Soffa, LandBridge, Light & Wonder, LiveRamp, Lyft, Magnite, Manulife Financial, Marqeta, McKesson, MediaAlpha, MetLife, MKS Inc., Murphy Oil, National Health, NCR Atleos, Nutrien, Occidental Petro, OPENLANE, Orion Engineered Carbons, Ormat Tech, Pan Am Silver, Paycom Software, Permian Resources, Power Integrations, Primerica, PROCEPT BioRobotics, Rayonier, RB Global, Realty Income, Remitly Global, Root, Inc., Royal Gold, Schrodinger, Seadrill Ltd, Sinclair Broadcast, SiTime, Sitio Royalties Corp., Sonos, Sprout Social, Steris, Sunrun, Symbotic, Talos Energy, Tandem Diabetes Care, Tennant, TKO Group Holdings, Tutor Perini, U.S. Physical Therapy, Uber & UGI Corp report earnings after the closing bell.
Thursday delivers Initial Jobless Claims & U.S. Productivity data at 8:30 am, followed by Wholesale Inventories & Fed President Bostic speaking at 10 am & Consumer Credit data at 3pm.
Constellation Energy, ACI Worldwide, Acushnet, Advanced Drainage Systems, Allete, Altice USA, Americold Realty Trust, Appian, Aspen Aerogels, Avadel Pharmaceuticals, BCE Inc, Becton Dickinson, Canadian Natrl Res, Cars.com, Cheniere Energy, Cogent Communications, Collegium Pharmaceutical, ConocoPhillips, Construction Partners, Crocs, Datadog, Dentsply Sirona, DigitalBridge, Ducommun, Ecovyst, Elanco Animal Health, Eli Lilly, Enovis Corporation, EPAM Systems, Establishment Labs, Evergy, First Advantage Corp., Gogo, Granite Constr, Haemonetics, Hanesbrands, Hertz Global, Himax Tech, Hyatt Hotels, Insmed, Installed Building Products, Janus International Group, Kelly Services, Kenvue, Kimbell Royalty Partners, Kontoor Brands, Krispy Kreme, LifeStance Health Group, Ligand Pharma, MACOM Tech, Martin Marietta, MAXIMUS, MDU Resources, Millicom International Cel, N-able, NCR Voyix Corporation, NetScout Systems, Nexstar, Nova Measuring, Olaplex, Pagaya, Papa John’s, Parker-Hannifin, Peloton, PENN Entertainment, Playtika, Prestige Consumer, Primo Brands Corporation, Privia Health, Ralph Lauren, Restaurant Brands Int’l, RXO, Inc., Sabre, Sempra Energy, SharkNinja, SolarEdge Technologies, Somnigroup International, Spectrum Brands, Starwood Property Trust, Tecnoglass, TEGNAT, United Parks & Resorts Inc., US Foods, Viatris, Vital Farms, Walker & Dunlop, Warby Parker, Warner Bros. Discovery, Warner Music Group, YETI Holdings & Zimmer Biomet, followed by 10x Genomics, Adtalem Global Education, Akamai Tech, Alarm.com, Alliant Energy, American Healthcare REIT, AMN Healthcare, Applied Optoelectronics, Arcosa, Arlo Technologies, Array Tech, Arrowhead, Artivion, Assured Guaranty, Astrana Health, Atlassian, AvePoint, Barings BDC, Block, Brighthouse Financial, CarGurus, Chesapeake Utilities, Chime, Clean Energy Fuels, Con Edison, Concentra, Corsair Gaming, Crinetics Pharmaceuticals, Cytokinetics, Definitive Healthcare, Diamondrock Hospitality, Doximity, Dropbox, Esco Tech, Evolent Health, Expedia Group, FIGS, Inc., Flutter Entertainment, Fox Factory Holding, Funko, Gen Digital, Genpact, Gilead Sciences, Globus Medical, GoDaddy, Grindr, ICU Medical, indie Semiconductor, Instacart, Insulet, Integral Ad Science, JFrog, Karman Space and Defense, Kratos Defense and Security, LegalZoom.com, Live Nation, Manitowoc, Microchip, Motorola Solutions, MP Materials, NerdWallet, nLIGHT, Omada Health, OneStream, Onto Innovation, Pembina Pipeline, Pinterest, Post, Progyny, PTC Therapeutics, Rapid7, RLJ Lodging Trust, Rocket Lab USA, RxSight, Solventum, SoundHound AI, StepStone Group, Sun Life, Sweetgreen, Synaptics, Take-Two, Texas Roadhouse, The Trade Desk, TripAdvisor, Trupanion, Twilio, Viavi, Victory Capital, Westrock Coffee Company, Wheaton Precious Metals, Wynn Resorts, XPLR Infrastructure, Xponential Fitness, Yelp & Zymeworks after the closing bell.
There is no major economic data scheduled for release on Friday.
Friday morning’s earnings calls include Algonquin Power & Utilities, Alpha Metallurgical Resources, American Axle, Atmus Filtration Technologies, Calumet Specialty Products, Embecta Corp., Essent Group, fuboTV, Gray Media, Koppers Holdings, Lamar Advertising, Open Text, PAR Technology, Plains All American, Sotera Health, Sylvamo, Tempus AI, TeraWulf, Under Armour & Wendy’s.
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 ***