The SPDR S&P 500 ETF (SPY) has a Neutral + Chaikin Power Gauge ETF Rating and is performing in line with the IWV (Russell 3000 ETF). The OB / OS Indicator is moving higher; neither overbought or oversold while Chaikin Money Flow is bearish. SPY continues to battle with the long-term trend line which has been a sticking point over the past few weeks. The Power Bar Ratio is bearish.
Yesterday was another example of the fund having a hard time breaking through resistance. A break of $293 – $300 opens the door to a move to $311. Should that level be broken to the upside, investors have to be open to the idea of the market retesting the highs. On the downside, a break of the $280 level would set the stage for a move to the $257 – $265 range.
The iShares Russell 2000 ETF (IWM) has a Neutral Chaikin Power Gauge ETF rating and continues to underperform the SPY but has shown relative improvement over the past few weeks. Our OB / OS Indicator is moving out of an oversold position and Chaikin Money Flow is slightly bullish. IWM is below the declining long-term trend line and has a slightly bullish Power Bar Ratio.
On the upside, the key retracement levels for IWM are $133 (50%) and $141 (61.8%). Should the fund begin to fade from current levels, the first area of support is in the $120 – $125 range.
Increasing participation on the part of small caps would be a bullish signal that breadth is expanding.
The Invesco QQQ ETF (QQQ) has a Very Bullish Power Gauge ETF Rating and is leading the SPY, with the intensity of outperformance increasing of late. The OB / OS Indicator is beginning to move higher after failing to reach an oversold level and Chaikin Money Flow is bullish. Resistance is in the area between $230 and $235 (which holds the gap that began the market’s selloff) while support is in the area between $205 and $215. The QQQ remains the strongest of the main market ETFs.
Take-Away: Major market ETFs in the US continue to trade in a choppy manner with strength concentrated in the QQQ. The SPY and IWM have met resistance at their long-term trend lines over the past few weeks. We have laid out the key levels for all three markets.