Market Analysis

SPY|QQQ Monday 4PM 6/17/2024

June 17, 2024 3 min read

Market Sentiment Analysis:

Overall Market Sentiment:

SPY (S&P 500 ETF):
Examining the SPY’s 30-minute intraday chart over the past 30 days, with particular emphasis on the recent 13 bars, several observations can be made:

Volume Trends: There has been noticeable volume in the last few bars indicating increased trading activity, particularly around the price dips and rebounds.
Moving Averages: The short-term moving averages suggest purchase behavior just below, propelling prices back over the $547 level after short-lived declines, hinting at buying support.
Price Movements: Recent movements demonstrate the ETF has been oscillating around the $547-$548 levels with brief dips, quickly followed by recoveries which may suggest a consolidation phase possibly leading to a breakout.

QQQ (Nasdaq-100 ETF):
Analyzing the QQQ’s 30-minute intraday chart over the past 30 days with focus on the recent 13 bars highlights:

Volume Trends: The QQQ mirrors the SPY in showing elevated volume at critical price points, reflecting significant investor interest around $485-$486 levels.
Moving Averages: Short-term moving averages indicate persistent buying pressure on brief downturns maintaining a consistent price range around $485.
Price Movements: QQQ has shown more volatility compared to SPY, with frequent movement within a tight range, indicating high interest and potential for a near-term breakout.

VXX (Volatility Index):
Observations based on VXX activity:

Significant Spikes/Drops: Recent bars around 13:30-16:00 show VXX rising to $11.18 from $11.05 reflecting increasing investor caution due to possible market uncertainties.
Impact on SPY and QQQ: The uptick in VXX suggests some underlying tension which may cap short-term gains in SPY and QQQ unless further institutional accumulation is witnessed.

Sector Analysis:

Strong Performing Sectors: Health Care (XLV), Technology (XLK), and Consumer Discretionary (XLY) have demonstrated resilience. Health Care and Technology, in particular, show healthy buying patterns during market dips.
Sector Rotation: An evident rotation out of Utilities (XLU) and Real Estate (XLRE), which have seen significant declines. Investors may be seeking more growth-oriented sectors.

Key Levels to Watch:

SPY:
– Support Levels: Near-term support is at $546.00.
– Resistance Levels: Immediate resistance at $548.30, with a more significant level at $549.50.

QQQ:
– Support Levels: Immediate support sits at $484.00.
– Resistance Levels: Resistance levels to watch are at $486.65.

Scenarios:

Bullish Scenario:
For SPY and QQQ, a bullish scenario could unfold if:
– Positive economic data such as GDP growth figures or employment data reinforces investor confidence.
– Strong earnings reports from key companies maintain or boost current price levels.
– Technical Breakouts from current resistance levels result in elevated buying activity.

Bearish Scenario:
For SPY and QQQ, a bearish scenario could unfold if:
– Negative economic news (e.g., inflation reports or gross domestic product concerns) depresses market sentiment.
– Geopolitical tensions escalate contributing to fear in global markets.
– Technical breakdown patterns, particularly if SPY and QQQ break below marked support levels with increased volume.

Overall Commentary:

Current market sentiment is cautiously optimistic but on edge, with market participants attentive to economic data releases and key earnings reports. The resilience in Health Care, Technology, and Consumer Discretionary sectors implies confidence in growth-oriented plays versus defensive stocks. However, the uptick in VXX reveals underlying caution that may influence short-term trading strategies. Attention to technical support and resistance levels is crucial for trade positioning over the coming days.