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SPY S&P 500 Index ETF and the Debt Ceiling DealThe political climate is favorable for a small rally of SPY, the S&P 500 Index ETF, towards the next resistance level of $430. After several weeks of tense negotiations, President Joe Biden and House Republicans have reached an agreement in principle to address the debt limit and cap spending. The debt-ceiling deal is now finalized, and here are significant parts of the agreement: First, the agreement suspends our $31 Trillion debt ceiling until January 2025, providing some relief and avoiding immediate concerns. Additionally, the agreement ends the pause on student loan repayments, allowing borrowers to resume their payments. This decision aims to ensure the stability of the student loan system and address the long-term financial implications. Furthermore, the agreement includes stricter work requirements for low-income and older Americans who receive food stamps. These requirements are intended to encourage self-sufficiency and help ensure that federal aid benefits are effectively utilized. Regarding IRS funding, the agreement entails a $20 billion reduction from the initially proposed $80 billion budget. This reduction specifically targets the allocation meant to crack down on tax evasion by wealthy individuals and corporations. Moreover, the deal puts an end to the ongoing freeze on monthly student loan payments and interest. It also introduces restrictions on the President's ability to reintroduce such a freeze in the future. To avoid contentious debates until after the next presidential election, the agreement suspends the debt limit until January 2025. This decision provides a temporary relief from potential conflicts surrounding the debt limit. The agreement also implements new work conditions for Supplemental Nutrition Assistance Program (SNAP) recipients, raising the age limit for work requirements to 54. This measure aims to promote workforce participation and enhance the effectiveness of federal aid programs. Overall, this comprehensive agreement addresses various aspects of the debt limit and spending caps, aiming to strike a balance between fiscal responsibility and supporting those in need. My overall outlook is still bearish and i think the small rally could easily turn into a bull trap. Looking forward to read your opinion about it.
AMEX:SPYLong
by TopgOptions
1
The inevitable collapseDXY looks to be at a reversal point, or is it? This is why I love looking at a ticker in relation to another by using the / symbol. The way it works is ( ticker youre interested in )/( in relation to another ticker ) . For this instance we will look at both DXY/SPY and SPY/DXY. Typically SPY and DXY do not move in correlation, in fact they move in the opposite directions. When the dollar is strong, stocks fall as more people invest in the dollar as opposed to stocks. In the contrary when more people are investing in stocks, there is less money being put into the dollar. First lets look at only the DXY chart. Here we are looking at the weekly chart of the dollar. Although we are still in a downtrend, with the 9,21 and 50 ema stacking to the downside, there seems to be the possibility of a double bottom occurring at a previous support level of 101. By looking just at this chart, the dollar looks primed for a reversal. The question is how strong of a reversal will it be? Next lets look at the DXY/SPY chart. This chart is a much different story and shows tremendous weakness in the dollar in comparison to stocks. We have a head and shoulders with the last reject off of the 200ma. The candles are following the downwards momentum along the ema with the continuing lows of the MACD and RSI. Last, lets look at SPY/DXY As SPY and the dollar are inversely correlated its no wonder that this chart is showing significant strength in SPY. We have an inverse head and shoulders with the 9,21, and 50 ema going upwards also followed with the upwards trajectory of MACD and RSI. If there is a break of the resistance line, I am even more than certain we are on our way to another bull run. I know the thought of a bull run sounds insane with so much talk about a recession but do you think the market wont be prepared for a massive short squeeze as everyone and their mothers have gone short in anticipation of a killer recession? Remember, the market never does what the masses want it to do. TLDR: DXY looks poised for a reversal but comparing DXY to SPY by looking at DXY/SPY and SPY/DXY shows significant weakness in the dollar in comparison to stocks. DXY and SPY are inversely correlated. All charts combined shows we may have a slight bounce in the dollar, but there is more downside still to come.
TVC:DXYShort
by MoRafi
Challenge my Elliot Wave Count looking for $406 $spy Posting this, because they're so many Elliott Wave Experts on Trading View. They always come to my posts to challenge my wave count, and it always goes in my favor. However, they never stick around when the trade goes in my favor, and worst they dont post any charts of their own when I challenge them.. So I'm doing an open invination for all $spy, $spx $es traders to post a chart w/ their wave analysis. I stand by my charts and analysis and I trust the money flow. I'm looking for $406 soon on $spy keeping it simple, we close above yesterday which is extremely bullish. We had a bullish ABCD pattern, which based in a cup/handle pattern w/ a bull flag .. I ran my Elliott Wave Count from the ABCD pattern to the cup/handle pattern. We're now at an Apex... Either The Bull Flag/handle pattern is incorrect of $spy Drops to $370-380 starting tomorrow... I'm following the Money, what are you doing. Lets see some charts, and I welcome feedback...
AMEX:SPYLong
by moneyflow_trader
23
S&P Short Term ATH?The sell off that started in December 2021 and January 2022 was thought of the "crash" that most logical analyst and economist are waiting for. It was illogical for markets not only recover the March 2020 sell off but set a new ATH during a year which saw the largest unemployment event also a pandemic and recession. The rally we know was Fed induced stimulus through QE corporate bond buying. The day the Fed announced tapering, rate hikes, and shrinking balance sheet is when the markets started selling. It wasn't ANY other reason except this. A market fueled by Easy Money will not continue to rally if the very things that fueled it are taken away. The rallies we have been witnessing are fueled by Corporate Buy Backs. In fact, according to Bank of America data, Retail Investors and Institutional Investors are still net sellers. This rally will be short lived. The economic data is still worse than expected and getting worse. BUT .. it seems that we will see a new ATH for the S&P500 before the actual crash happens. The Nasdaq should not make a new ATH, but the Dow has a great possibility it will. We could see a Double-Top followed by the crash or a new ATH. A conservative 35% fall would put the S&P in the low 3,000s.
AMEX:SPYLong
by WorldEconomics
5
Here's Why the Stock Market is at Risk of Further DeclineThe chart above shows the S&P 500 (SPX) relative to the price of the 10-year U.S. Treasury bond (1/US10Y). As you can see, when adjusted in this way, the S&P 500's decline in 2022 is no longer apparent. This could be a warning that further stock market decline is to come. Let's walk through why this may be. First, it is important to understand that an interest rate is simply the cost of money. Central banks use interest rates to raise or lower the cost of money, which can impact the money supply by lowering or raising it. For details on how the interest rate can impact the supply of money, you can check out my post here: When we look at a chart of the yields on the 10-year U.S. Treasury bond, as shown below, what we're actually looking at is a chart of the cost of money. When the Fed says it will continue to hike rates and hold them higher for longer, what the Fed is really saying is that it will continue to raise the cost of money and keep money costlier for longer. This is bad news for the stock market because it is unlikely to undergo a massive bull run while money remains scarce. In fact, Fed Chair Powell recently stated that a high stock market valuation is a cause of the labor shortage. High stock market returns incentivize people to retire early and live off of investment income. Combined with the already difficult demographic headwind of an aging population, the economy becomes faced with too many people consuming and too few people producing. This is a major cause of the labor shortage. Thus, if high stock market returns are a cause for the labor shortage, and the Fed's goal is to mitigate the labor shortage to mitigate inflation, then the stock market is likely to face prolonged headwinds. A massive bull run in the yields on bonds has come along with a rapidly declining supply of money. Until this trend ends, there is simply not enough money to propel the stock market to new all-time highs. Remember that the stock market is largely a measure of corporate earnings, and corporations can only ever earn some subset of the total money supply. What might a record decline in the money supply say about the future of corporate earnings? Government bonds, especially U.S. Treasury bonds, are considered risk-free assets since the central government, which issues these bonds, has the ability to print more money and thus can always afford to avoid default. In a normal market, whenever higher interest rates are demanded by market participants for an asset the market is saying that it perceives greater risks associated with that asset. The higher interest rates compensate investors for the greater risk. Since the rates on U.S. Treasurys have soared, the market is sending the message that it now perceives these assets as riskier. Although Treasurys can be perceived as risk-free from a default perspective, there is still a risk of loss, especially when higher inflation becomes entrenched for the long term. The increased risk can actually become a positive feedback loop because as the market demands higher rates due to inflation, then the government will have to pay more to service its debt. Such an expansion in the cost of debt service can cause the market to then believe the bond risk is higher, and the market may demand yet even higher interest rates. (Although the central government can always print more money to pay its increased debt, for political reasons it may choose default instead. Thus, there is a risk of default even for theoretically risk-free bonds). Furthermore, even if the central government chooses not to default, it will be forced to print more money to service higher debt which could worsen inflation and, in turn, keep rates higher for longer. Therefore, it is important to understand that in the face of high inflation, risk-free Treasurys have become risky relative to their historical norm. In that regard, since all other assets except physical gold (e.g. stocks, corporate bonds, cryptocurrency) are inherently more risky than Treasurys, all other assets become less stable. This concept is illustrated in Exter's Pyramid, shown below. When an asset class lower down in the inverted pyramid becomes unstable, everything above it will experience some greater degree of instability. The most speculative fringes of the market (the top of the inverted pyramid) are likely to experience outright liquidity crises. We are already beginning to see this in the cryptocurrency space which is not pictured on the pyramid, but which if it were, would be near the top. So a massive bull run of the S&P 500 relative to the price of 10-year US Treasurys is not a good sign. What this chart is showing is that the S&P 500 is becoming more and more overvalued relative to risk-free Treasurys, even as the S&P 500 nonetheless sells off! The amount of capital that is currently invested in the S&P 500 is too high for the yields on 10-year Treasurys to be as high as they are. This suggests that capital will tend to flow out of the stock market and into less risky and higher-yielding Treasury bonds. The Federal Reserve is trapped by commodity inflation because it cannot cut interest rates, or make money cheaper, without worsening commodity inflation. If scarcities of commodities continue to weigh on commodity prices, keeping them elevated even as demand cools, then the coming stagflation is likely to be severe. Since the yields on the risk-free Treasurys have skyrocketed, this means that even after all the declines we've seen so far, most assets are still overvalued. Look how high the value of Nasdaq 100 stocks has risen relative to the risk-free 10-year Treasury. The last time this happened was right before the Dotcom Bust in 2000. Although this relative chart does not predict whether the price of Nasdaq 100 stocks will go down, or the yields of 10-year Treasurys will go down, it does suggest that if the yields of 10-year Treasurys remain elevated, as the Fed suggests will happen, then the price of Nasdaq 100 stocks is likely to fall even further. In the chart below, we can see that the fastest and most extreme yield curve inversion in history is occurring right now. This could suggest that the onset of the impending recession could be as equally fast and as extreme. The abruptness of FTX's collapse due to liquidity issues could be a harbinger of what's to come. The Federal Reserve is already adding liquidity back into the banking system. Job openings likely reached their cycle high and will continue to decline into the foreseeable future as the supply of money remains some degree tighter into perpetuity. In the U.S., population and GDP grew at an exponential rate over much of the past century. This, in large part, allowed for the money supply to also grow at an exponential rate without high inflation. Since the stock market tracks the money supply, the stock market also largely grew exponentially as well. However, as population and GDP growth slow, this creates the risk that an exponentially growing money supply may result in persistently high inflation. In the coming recession, which will likely be characterized by severe stagflation, central banks will likely have to convince the market that high inflation is good.
SP:SPX
by SpyMasterTrades
55
Bullish above last month HIGH Buy signal still valid SPX SPY SNPWith all the Doom & Gloom regarding recession worries we liked our idea even more so into Q1 close last month. So far so good however we are still very early in Q2. We remain bullish above last months high (March 2023) Seeking Pips will be managing our positions on the Weekly and Daily charts. We also note that the current price is also in a key Fib retracement zone to SELL SPX on the monthly chart so we will not be surprised to see another pullback, again we would consider adding to our core position if this happens and volatility is right. Our Bull & Bear price level is clear and as long as we above it we want to be buyers only. A failure of March 2023 Low we would have to revaluate our current thesis. Happy trading have a GREAT WEEK.! =============================================================== SUBSCRIBE TO OUR CHANNEL & FOLLOW THIS TRADE IDEA FOR UPDATES.
CBOE:SPXLong
by seekingpips
1
Bullish til $407.50 then looking to short the HnS patternThe AD is causing an ascending triangle on the 2hr chart I'm forecasting here, so give me a little rope. The AD is ascending (ascending triangle technically) to $407-$408 area. It's likely to retest the 3rd leg of the Eliott wave which was sold off. This rejection, can cause a bearish Head and shoulders pattern. look at wave 1 as the left shoulder, wave 3 as the head, and this final push in attempt to invalidate wave 3 which will likely cause a bearish head and shoulders pattern. Tomorrows FOMC meeting/discussion is going to be more volatile than normal. Imho, both bulls/bears should be able to eat. I wont take a short position til after $407.50 is touched.. Look at the market heavyweights TSLA, AAPL, SPY (obviously), for clues but will also be looking at $uvxy, $faz, $tlt for additional clues. so seeing this now, I likely wont beat up futures... I'll just be monitoring and posting some updates to the chart. Im both a bull/bear when I need to be..
AMEX:SPYLong
by moneyflow_trader
33
XLF Triple Bottom Support for SPY Bulls, QQQ Daily Bull Flag, - XLF holding triple bottom support 15m, holding above yeseterdays low bounce off of it 3 times today, first initial sign for the bulls. Now bulls need the hourly trend change for XLF back to an uptrend to help SPY - QQQ's drop may seem a lot today due to how fast we pulled back from the morning but we are still way above 0.386 fib retracement on daily therefore QQQ is still in a bull flag zone. - if XLF starts bouncing and changing trends i am likely going to swing some short term bull positions in the leverage 3x SPXL TQQQ TNA
NASDAQ:QQQLong
by ArcadiaTrading