SPY: Reversal or Continuation? Nov. 18, 2024
SPY) is rebounding after a sharp sell-off, with price approaching critical resistance levels. With strong volume near recent lows, it’s a crucial moment for traders to watch for breakout or rejection opportunities. Here’s a detailed trading plan for scalping and swing setups.
Technical Overview:
Market Structure:
Trend: SPY remains in a short-term downtrend, but the current bounce from the lows indicates potential bullish momentum.
EMA Levels: The 9 EMA (purple) and 21 EMA (blue) are converging, creating a dynamic resistance zone near $590.
Key Levels:
Resistance Zones:
$594.50 – Immediate resistance aligned with EMA confluence.
$601.00 – Psychological resistance and key supply zone.
Support Zones:
$583.00 – Current support zone where buyers stepped in.
$580.00 – Critical demand zone and psychological support.
Supply and Demand Zones:
Demand Zone: $580.00–$583.00, where buyers have shown strong interest.
Supply Zone: $594.50–$601.00, where sellers have consistently stepped in.
Indicators:
MACD: Shows bullish divergence, with momentum building on the histogram.
Volume: Increased green volume bars indicate growing buyer interest near $583.00.
Pattern:
Potential inverted head and shoulders forming, signaling a possible reversal if $594.50 breaks.
Game Plan:
Scalping Plan (1-Min and 5-Min Timeframe):
Entry for Long:
Buy if price breaks above $594.50 with strong volume.
Target 1: $598.00 (scalp to mid-resistance).
Target 2: $601.00 (supply zone).
Entry for Short:
Sell if price rejects $594.50 or breaks below $583.00.
Target 1: $580.50 (psychological support).
Target 2: $580.00 (demand zone test).
Stop Loss:
Long: Below $593.00.
Short: Above $595.50.
Swing Trade Plan:
Bullish Scenario:
Buy if price holds above $583.00 and breaks $594.50.
Target 1: $601.00 (supply zone).
Extended Target: $610.00 (potential breakout level).
Stop Loss: Below $580.00.
Bearish Scenario:
Sell if price fails to hold $583.00 and breaks below $580.00.
Target 1: $570.00 (next demand zone).
Extended Target: $560.00 (potential lower low).
Stop Loss: Above $584.50.
My Thoughts:
For Scalping: Watch for a breakout or rejection at $594.50 for momentum trades. The volume profile near $583.00 suggests strong buyer interest, so tight risk management is key for shorts.
For Swing Trades: Price above $594.50 could signal a bullish reversal, while failure to hold $583.00 opens the door for further downside.
Directional Bias:
Short-term: Neutral-to-bullish if $594.50 breaks with strong momentum.
Mid-term: Slightly bearish unless SPY reclaims $601.00.
Actionable Suggestions:
Use the $594.50 resistance and $583.00 support as key levels for entries.
Focus on volume and price action at these levels for scalping and swing setups.
Avoid trading within the $583.00–$594.50 range to reduce noise and increase risk/reward.
Disclaimer:
This analysis is for educational purposes only and not financial advice. Always use proper risk management when trading.
Technical Overview:
Market Structure:
Trend: SPY remains in a short-term downtrend, but the current bounce from the lows indicates potential bullish momentum.
EMA Levels: The 9 EMA (purple) and 21 EMA (blue) are converging, creating a dynamic resistance zone near $590.
Key Levels:
Resistance Zones:
$594.50 – Immediate resistance aligned with EMA confluence.
$601.00 – Psychological resistance and key supply zone.
Support Zones:
$583.00 – Current support zone where buyers stepped in.
$580.00 – Critical demand zone and psychological support.
Supply and Demand Zones:
Demand Zone: $580.00–$583.00, where buyers have shown strong interest.
Supply Zone: $594.50–$601.00, where sellers have consistently stepped in.
Indicators:
MACD: Shows bullish divergence, with momentum building on the histogram.
Volume: Increased green volume bars indicate growing buyer interest near $583.00.
Pattern:
Potential inverted head and shoulders forming, signaling a possible reversal if $594.50 breaks.
Game Plan:
Scalping Plan (1-Min and 5-Min Timeframe):
Entry for Long:
Buy if price breaks above $594.50 with strong volume.
Target 1: $598.00 (scalp to mid-resistance).
Target 2: $601.00 (supply zone).
Entry for Short:
Sell if price rejects $594.50 or breaks below $583.00.
Target 1: $580.50 (psychological support).
Target 2: $580.00 (demand zone test).
Stop Loss:
Long: Below $593.00.
Short: Above $595.50.
Swing Trade Plan:
Bullish Scenario:
Buy if price holds above $583.00 and breaks $594.50.
Target 1: $601.00 (supply zone).
Extended Target: $610.00 (potential breakout level).
Stop Loss: Below $580.00.
Bearish Scenario:
Sell if price fails to hold $583.00 and breaks below $580.00.
Target 1: $570.00 (next demand zone).
Extended Target: $560.00 (potential lower low).
Stop Loss: Above $584.50.
My Thoughts:
For Scalping: Watch for a breakout or rejection at $594.50 for momentum trades. The volume profile near $583.00 suggests strong buyer interest, so tight risk management is key for shorts.
For Swing Trades: Price above $594.50 could signal a bullish reversal, while failure to hold $583.00 opens the door for further downside.
Directional Bias:
Short-term: Neutral-to-bullish if $594.50 breaks with strong momentum.
Mid-term: Slightly bearish unless SPY reclaims $601.00.
Actionable Suggestions:
Use the $594.50 resistance and $583.00 support as key levels for entries.
Focus on volume and price action at these levels for scalping and swing setups.
Avoid trading within the $583.00–$594.50 range to reduce noise and increase risk/reward.
Disclaimer:
This analysis is for educational purposes only and not financial advice. Always use proper risk management when trading.
Disclaimer
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