Spy Outlook - Two Key Scenarios to Watch this WeekHello everyone, I’m theCafeTrader — hope you all had a great weekend.
Currently, SPY is sitting near the tail end of a supply zone around 569.57 . So far, it hasn’t shown strong conviction to push through this area, which likely reflects a lack of buying interest rather than heavy absorption by sellers.
In this post, I’ve outlined two scenarios for how you might approach trading SPY this week. As you’ve probably noticed, we’re sitting right in the middle of the broader range . I’ve marked out both light and heavy supply and demand zones — these will be critical for spotting clean entry opportunities.
Remember, liquidity moves markets , and we want to be on the right side of the move with strong entries.
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Scenario 1: Break Above Supply
If we open or gap above the current supply , and price holds that level , I can see SPY pushing up toward 584 , encountering some light supply on the way.
The play might look like this:
• SPY runs up to 576 , hesitates slightly (possible minor rejection),
• Finds a bidder and continues to 584 , where heavier selling pressure is likely waiting.
That would be the ideal short entry , with a little room for volatility, aiming for a move back down into a new demand zone (not yet formed or shown here).
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Scenario 2: Rejection and Roll Over
If we reject this supply zone and roll over , watch for price to cut through demand again and test the big buyers near 549.50 .
I’m especially interested in longs in that area. Even if price dips a bit further, there’s extreme demand at 540 , though I’d prefer to keep a tight stop so I can reposition quickly if needed.
From there, I think we could catch a strong bid and rally back up to 584 .
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