SPTM Prepare for Consolidation or Pullback in the Coming QuarterThe SPDR Portfolio S&P 1500 Composite Stock Market ETF (SPTM) has shown impressive performance over the past months, driven by a general bullish market sentiment. However, as we approach the next quarter, key indicators from the QuantEdge Momentum System suggest that the ETF might face significant resistance, leading to a potential period of consolidation or even a pullback.
Key Technical Insights:
Z-Score Analysis:
The Z-Score currently stands at 0.7583, indicating that the price of SPTM is trading above its historical mean. However, this value is nearing a threshold where the momentum might start to slow down. This suggests that while the ETF has experienced an uptrend, the room for further gains could be limited unless there is a strong bullish breakout.
Z-Score of RSI:
The Z-Score of RSI is in the negative territory (-0.9841), which is a divergence from the positive price Z-Score. This indicates that the momentum behind the uptrend is weakening. RSI being below its average typically signals that buying pressure is diminishing, which could result in a stagnation or decline in price.
Cumulative Volume Delta (CVD):
The CVD reflects a higher level of selling pressure, with cumulative volume favoring sellers. This is another warning sign that the upward momentum might be unsustainable in the short term.
Projection for the Next Quarter:
Given the mixed signals from the proprietary QuantEdge Momentum System, it is likely that SPTM could encounter resistance near current levels. Traders should be cautious as the ETF might enter a consolidation phase or experience a pullback during the next quarter. The weakening RSI momentum and increasing selling volume suggest that upside potential is limited unless there is a significant catalyst to drive prices higher.
For traders, this is a crucial moment to assess risk and possibly secure gains from the previous uptrend. Those looking to enter new positions may want to wait for a clearer breakout signal or consider short-term trades based on confirmed support levels.
Stay vigilant and adjust your strategies according to the evolving market conditions. The QuantEdge Momentum System will be your guide to navigate the upcoming volatility in SPTM.
SPTM trade ideas
The first times this year at 100 dayWould you believe it if I said that the past 2 weeks have been the first time hitting the 100 day MA this year? 2021 up until now has been a very smooth ride.
We haven't touched the 200 day at all this year.
A 10% correction from the highs at the start of September would hit, maybe break the 200 day AND this support in May.
I'm a long term bull, comfortable at adding to my portfolio today at the 100, and will continue to do so if we hit the 200 day or hit support.