SPDR S&P 500 ETF Trust (SPY): A Chartbook Unlike Any Other
The S&Pieth stepped up to the 12th hole Wednesday with a 17 handle lead before dumping two in Ryan’s Creek to close down 7. While intraday reversals from all-time highs always have my attention; importantly key technical levels held, spillover was minimal to non existent overnight, and there was no evidence of any structural damage to the macro technical backdrop which would suggest that a bigger “Back 9” meltdown has commenced.
Crude is higher and remains in a strong short term position to build on recent gains; Yields are slightly firmer having held critical support at 2.30; Yen stared down a break below the 1.10 level before reversing higher (weaker); Gold failed to take out key resistance at 1,260; and Europe is higher; the sum of which continues to suggest that risk appetite and the rally remain intact absent breaks below these key levels. The Nikkei (-1.4%) has taken it the hardest closing at a new low for the year (-2.7% ytd) with the TOPIX Banks -9.3% faring far worse than both the BKX (-1.3%) and the European Banks (+3.4%!).
Augusta continues to favor the big hitter with the Russell trailing the S&Pieth by 550 bps as it stares down a lightning fast double breaker below 1347. The S&P itself has held that 50day on a closing basis since the election establishing the weekend cutline at 2344 for aggressive accounts. While I like Amazon.com, Inc. (NASDAQ:AMZN) to hit 1,000, it is the most overbought and short term exhausted of the FANG. In sum, I continue to like Crude, the DXY, Yields, Europe, EM and the US to trade higher in so far as the key technical levels highlighted within continue to hold. My call is that we hold these levels and trade 2470 in June.