SPY has erased all of its day’s gains following a surplus in oil/gas inventories this morning – frankly it was already giving up most of its gains well before then. However, the SPY is now trading in negative territory on the day so the question remains whether the bulls can keep the slight bit of mojo that it has accumulated over the previous two trading sessions that suggests a bigger market bounce might be forming OR the previous two days was just a temporary reprieve before we see more downside starting back up. 

The latter option doesn’t make much sense to me. Historically the market is like a rubberband – the more you stretch it, the more vicious the snap-back will become. So dismissing the likelihood of a a bounce here or in the near future is pure gibberish. market-channel

If you take a look at the SPY below you’ll see I’ve done some technical analysis on this parallel rising channel it is currently stuck in, and considering we are looking at 5 straight red bars on the 30 minute chart, there is a good chance we’ll see at least a temporary relief bounce intraday, even if it isn’t a major move. 

Here’s the SPY chart:

spy rising channel

    You are unauthorized to view this page.

You Might Like

  • Learn to trade within your means.

    Stop Trying to Hit Home Runs: Start Trading Within Your Means

  • Avoiding traps on stock breakout plays.

    How to Trade Breakouts Without Getting Trapped

  • how to manage your swing trades when it comes to headline risk.

    Managing Headline Risk: How to Survive the News Cycle Without Losing Your Mind