The Song Remains the Same: SPY Overbought at the Top of the Range - Chaikin Analytics

The Song Remains the Same: SPY Overbought at the Top of the Range

The SPDR S&P 500 ETF has a Bullish Chaikin Power Gauge ETF Rating and is overbought as a new week begins. The fund is above the rising long-term trend line which is in the zone that we have been highlighting between $300 – $310. The fund spent much of last week trading near resistance at $325. Chaikin Money Flow has been mixed of late with a slight edge now for bullish money flow. 

Our view on the equity market remains as it has been for the past few weeks. A break from the consolidation will determine the best course of action. Despite consolidating for a month, the bulls remain in control until $300 is broken to the downside. 

Small Caps

The iShares Russell 2000 ETF (IWM) has a Neutral Chaikin Power Gauge ETF Rating, down from Bullish last week, and continues to underperform the SPY. The OB / OS Indicator is near an overbought condition and Chaikin Money Flow is bullish. The fund is above the long-term trend line and the Power Bar Ratio is bullish. 

Support is in the $130 – $135 range. Resistance is near the $150 level.

Fixed Income 

The iShare 7 – 10 Year Treasury Bond ETF (IEF) has a Bullish Chaikin Power Gauge ETF Rating and is lagging the SPY. The OB / OS Indicator is moving higher after failing to reach an oversold level and Chaikin Money Flow remains bullish. IEF is trading at the rising long-term trend line. 

Support is in the $118 – $120 range while resistance is in the zone between $123 and $124. We continue to feel that investors who are running diversified portfolios could benefit from having exposure to treasuries which act as a diversifier in times of equity volatility.      

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