$SPY Fails at Former Support and Now New Resistance

This was our post earlier today as $SPY rallied for the 3rd day in a row off the 420 lows. But the bull’s former support level of 437-438.50 was too much resistance, and as we mentioned in our tweet the rally fizzled out. I would’ve preferred to see the gap closed at 438.50 but this failure is a good sign of a move lower. Now we are left with a firm resistance level and a shooting star candle stick pattern. These are bearish candles since it represents a failure of buyers to maintain the price at the resistance level.

We haven’t touched this chart in a few days or the pink line since Sept but this is the path we see the market going here.

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