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Stock Market News And Technical Analysis On SPY

By Guest

Through the July 4th long weekend, I am going to bring you up to date on SPY.

Studying the weekly chart on SPY you will grasp that in the previous week we hit the neckline and officially produced a bearish Head and Shoulders top. I alerted you to this pattern 2 weeks ago, and I have been closely watching it ever since. If you stay up on my real time Facebook and Twitter updates then you know on the dot when the neckline was taken out last week and the short ETF I purchased.

In this video I trace a blue trend line for the neckline on the weekly chart so that you can observe how it was closed. That was a devastating slaughter for bulls and a huge win for bears. The volume is performing a classic stair step pattern as selling has picked up into the testing and break of the neckline.

I argued with a stock analyst in the previous week who expressed that I should pay little attention to the breaking of the neckline for the reason that it happened on low volume. That low volume, he said, meant that the stock market was not going to go any lower. He was off beam and I was correct. Be trained as a result of his mistake. Price action trumps volume every time. Volume is often a lagging indicator.

The MACD on the weekly chart shows a double thrust to the downside on the histogram bars. Double pumps to the downside are very bearish. Normally the histogram bars form neat waves higher than and after that beneath the 0 line. Double dips are to some extent unusual.

I zealously advise you to be short this market. You can purchase a Russell 2000 small caps short, a S&P 500 large caps short, or you can short an separate industry like consumer services or finance. No matter what you choose, you need to understand that it is going to be easier to earn money on the short side than on the long side for now. Attempting to make money on the long side is going to be like a fish swimming upstream. You can still do it, but it is going to be lots of extra work. It will be easier to trade with the stream rather than against.

I can really hit myself since I was short this market for most of May and then from June 7th to June 18th a classic Head Fake took shape that made me take profits in my short and go long. As you can see from the trading history that is updated in real time through Google Docs on my blog, I had two successive losses back to back on the long side because of this Head Fake. This is just part of stock trading, you will never get all your calls correct. My current accuracy is between 70% and 80% with my long term, 10 year accuracy rate at 75%. As long as I cut my losers quick (5% loss) and let my winners ride (between 5% and 10% gain then sell), I really like this 70% to 80% accuracy.

But one thing you will notice about me, I make no apologizes when I get a call wrong as it is just part of trading. I recognize that as long as I can get 70% to 80% accuracy, I will make money. The key thing to focus on is not your wrong calls, but in repositioning yourself to be on the right side of the trade. The entire goal is to get it right as swiftly as you can.

In the video below, I carry out technical analysis on the SPDR S&P 500 ETF (SPY) in three time frames: weekly, daily, and hourly. You don’t wish to miss this video and particularly where I show you the hourly chart and what I think is end of quarter window dressing by money managers as they reposition themselves. I too explain to you what stocks institutional traders repositioned themselves in.

Have a joyful 4th of July holiday weekend.

Give live stock market news and live stock trade updates. Massively increase your stock trading accuracy by always knowing which way the stock market trend is and watch over 100 hundred videos and stock trading lessons all totally free at stock market technical analysis

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Article Citation
MLA Style Citation:
Guest, Guest "Stock Market News And Technical Analysis On SPY." Stock Market News And Technical Analysis On SPY. 11 Jul. 2010. 15 Sep 2014 <>.

APA Style Citation:
Guest, G (2010, July 11). Stock Market News And Technical Analysis On SPY. Retrieved September 15, 2014, from

Chicago Style Citation:
Guest, Guest "Stock Market News And Technical Analysis On SPY"

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