SPY S&P 500 Spiders ETF Daily Chart Channel Negative Divergence

SPY came up to the previous highs on Friday, however, the red lines show that negative divergence is in place, so the bulls have nothing to celebrate. Price may continue to explore the red circle, which would only serve to lock-in the negative divergence, so a spank down should occur at any time. Note that the neon blue lines were in universal negative divergence that created the spankdown a few days ago. Therefore, price had nothing to prove by coming back up, the chart is rolling over, and price should reverse at anytime.

SPY sits on an island now, formed when price gapped up from 132.5 to 134.0 in early February, thus an island reversal may occur on the way back down, at the least, the gap should be targeted. The 20-day MA is an early warning system to signal that there is trouble ahead. Friday printed a doji candle indicating potential for a market reversal right now but Monday would need to show follow thru to the downside. The 200-day MA sloping up is a feather in the bulls cap. Projection is for price to drop from the red circle, at any time, with lower targets at 134.0, 132.5, 130.5. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any financial decision.