SPY for TA Tomorrow 9/30. 1. Price Action Overview:
Current Trend: The price appears to be in a downward movement after breaking a rising trendline. There is a consolidation phase near the lower end of today's range, which suggests indecision or a potential bounce near support.
Volume Profile: The high concentration of volume is around the price levels between 570-572. This indicates that this area has been significant for both buyers and sellers and could act as a pivot zone.
2. Key Levels:
Support:
570.42: Strong near-term support, highlighted by the red horizontal line. A breakdown below this level could lead to further downside pressure.
569.89: The lower end of this support zone. A break here could open the door for a test of the 560.79 level, which is another key support based on volume profile and recent lows.
560.79: This represents a significant lower support level. If the market becomes extremely bearish, this level may be tested.
Resistance:
571.32: Immediate resistance, shown as a red line on the chart. The price has previously rejected this area, so a break and hold above could show bullish momentum.
574.21 - 575.01: This is a notable resistance zone (highlighted in blue). If the price manages to break through 571.32 and rally, this area could provide strong resistance, as it coincides with prior highs and a volume shelf.
575.50+: Beyond this level, SPY would likely experience some resistance due to prior highs from the 25th-26th.
3. Potential Entry/Exit Points:
Bullish Scenario:
Entry: A long position can be considered on a bounce from the 570-569.89 support zone. Wait for confirmation of support holding (e.g., bullish candle pattern, or volume surge).
Exit: Target the 574-575 resistance area for profit-taking, but keep an eye on momentum to see if it can break further. If volume increases on the upside, you can look for targets beyond 575.50.
Stop Loss: Place a stop below the 569.89 support to minimize risk if the price breaks down.
Bearish Scenario:
Entry: A short position can be considered if price fails to break above the 571.32 resistance level or on a breakdown below 570.42 with strong volume.
Exit: First target would be 569.89, and the second target would be the key support level near 560.79. Beyond this, further downside may be possible if there’s continued selling pressure.
Stop Loss: If shorting near 571.32, a stop just above this level (around 572 or 572.50) would protect against a reversal.
4. Indicators Analysis:
Moving Averages: The price seems to be below key moving averages, indicating short-term bearish pressure. If it moves back above the MAs, it could indicate a bullish reversal.
MACD: The MACD at the bottom suggests that bearish momentum is slowing down as the histogram is flattening. This could indicate a potential reversal if a bullish crossover occurs soon.
5. Overall Sentiment:
Bearish Bias: As the price broke below the trendline and is currently below the key levels of 571.32, the short-term bias appears bearish. A further break below 570.42 and 569.89 could intensify this.
Bullish Potential: If SPY holds the 570 level and shows strength tomorrow, it could attempt a rally toward the 574-575 resistance zone.
Suggestion:
Tomorrow, I would watch closely for price action around the 570-569.89 zone to determine if there is support holding or if further downside pressure is building. If support holds, look for a potential bounce, but if it fails, prepare for a bearish move.
