SPDR S&P 500 Trust (US: SPY) has been trending up for a year and its long term technicals show further upside. We expect a slight correction this week before resumption of the rally:
- Price is trending above all Ichimoku indicators as well as both the primary and secondary uptrend lines. This signals a continuing uptrend.
- The resistance level has been tested four times in recent price action, indicating a weakening resistance. However, a potential short term reversal is likely due to the appearance of Doji candles and lower volumes below the 10-period moving average the past 4 days signalling slowing price momentum.
- We expect prices to rise to the 161.8% and 200.00% expansion levels of US$371.94-398.01.
- We will likely see a correction to the 23.8% and 38.2% Fibonacci retracement levels before seeing a rebound to the target prices.
*Expected timeline of the trade is 10 weeks from the date of report issuance.
CHART LEGENDS
Ichimoku Kinko Hyo
Red dotted line: 9 period Tenkan-Sen
Blue dotted line: 26 period Kijun-Sen
Green Line B: 52 period Senkou Span B
Pink Line A: 26 period Senkou Span A
Black line: 26 period Chikou-Span. (Lagging line)
