No change. Stocks remain strong. SPY is up over 5% the last 11 days. Small indecisive candlesticks formed after Wednesday's gap up, but the gap is holding. Even though potential resistance from the February-March highs is close and stocks are short-term overbought, there is simply no discernable selling pressure. The turnaround over the last two weeks has been nothing short of amazing. This rally is probably a combination of bottom pickers, early trend followers and end-of-quarter window dressers. We now have the employment report on deck. With indecision the last two days, Friday's employment report could generate some fireworks.
On the 60-minute chart, SPY gapped above its latest short-term resistance level and held the gap. Broken support and the gap produce the first short-term support level at 132, which is also confirmed by the blue trendline. For now, I will leave key support at 130.
Key Economic Reports/Events:
Fri - Apr 01 - 08:30 - Employment Report
Fri - Apr 01 - 10:00 - ISM Index
Fri - Apr 01 - 10:00 - Construction Spending
Fri - Apr 01 - 15:00 - Auto-Truck Sales
Charts of Interest: Tuesday and Thursday in separate post.
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This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it comes to trading our own accounts. First, it is the only way to really learn. Second, we are the only ones responsible for our decisions. Think of these charts as food for further analysis. Before making a trade, it is important to have a plan. Plan the trade and trade the plan. Among other things, this includes setting a trigger level, a target area and a stop-loss level. It is also important to plan for three possible price movements: advance, decline or sideways. Have a plan for all three scenarios BEFORE making the trade. Consider possible holding times. And finally, look at overall market conditions and sector/industry performance.
About the author:
Arthur Hill, CMT, is the Chief Technical Strategist at TrendInvestorPro.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London.
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