Although I like to keep tabs on all major stock indices, in keeping this market update simple, let’s just take a look at some recent developments & near-term resistance levels on SPY (S&P 500 tracking ETF). The first chart below is a 15-minute period highlighting the recent divergent low (bullish) that preceded the advance off Monday’s lows. That advance has taken the form of a relatively small bearish rising wedge pattern, confirmed with negative divergence, with the SPY breaking below & recently back-testing at the apex of the wedge with prices reversing from there.
SPY 15-minute March 30th
This next chart is a 30-minute period chart of the SPY which highlighting how well the next two overhead resistance levels line up with the key 50% & 61.8% Fibonacci retracement levels of the move down from the March 1st highs. The resistance levels are both defined by numerous reactions (i.e.- candlestick bodies and shadows) from above & below. When key Fib retracement levels align with price support or resistance, that helps to increase the chances of a reaction on the initial tag of those levels.
SPY 30-minute March 30th
Taking the technical developments on both of these time frames into account (i.e.- 15-minute rising wedge breakdown & backtest plus the SPY running into dual resistance of the 50% Fib & the 236.20ish price resistance on the 30-minute chart), I favor a reversal & resumption of the downtrend from around current levels with an alternative scenario of the SPY continuing up to the 237.10ish price resistance + 61.8% Fibonacci retracement level before reversing & eventually going on to take out Monday’s lows.