Nasdaq is holding onto its channel and looks prime for a bounce soon to the top of the channel.
SPY on the other hand has broken its channel but conditions still remain oversold. SPY can go down a little from here but, it will look to retest the broken trend line.
The Chart of SPY from 2020 is quite scary. There are so many GAPS. Gaps occur when there is such heavy buying pressure usually caused by extreme risk-taking/speculation (high volume of call options, short covering). The thing about gaps though, is that they always get filled eventually. Looking at SPY there are three or so major gaps with the lowest being at 286 (-30% drawdown). There is also a gap at 400. QQQ has less gaps than SPY but there is a gap for QQQ at 186 (-50% drawdown).
Markets remain for the most part indecisive. Markets look to be bullish in the short-medium term but, bearish in the long term. It is a traders market now best to pay attention to Support and Resistance areas.
SPY on the other hand has broken its channel but conditions still remain oversold. SPY can go down a little from here but, it will look to retest the broken trend line.
The Chart of SPY from 2020 is quite scary. There are so many GAPS. Gaps occur when there is such heavy buying pressure usually caused by extreme risk-taking/speculation (high volume of call options, short covering). The thing about gaps though, is that they always get filled eventually. Looking at SPY there are three or so major gaps with the lowest being at 286 (-30% drawdown). There is also a gap at 400. QQQ has less gaps than SPY but there is a gap for QQQ at 186 (-50% drawdown).
Markets remain for the most part indecisive. Markets look to be bullish in the short-medium term but, bearish in the long term. It is a traders market now best to pay attention to Support and Resistance areas.
Comment:
SPY has another gap at 230. I wonder how many years that will take to fill.