SPY's Recovery: Amid Trendline Break for Nov. 20, 2024
SPY is displaying a solid recovery after a steep downtrend, breaking key trendlines and reclaiming critical levels. As it inches toward overhead resistance, SPY offers prime setups for scalping and swing trades. Here’s a structured trading plan to navigate its next moves.
Market Structure Overview
* Trendline Breakout: SPY has broken a descending trendline, indicating a potential shift in sentiment toward bullishness.
* Volume Analysis: Rising volume accompanies the breakout, signaling buyer interest at current levels.
* Current Price Action: Trading near $591.40, SPY is consolidating just below a significant resistance zone.
Liquidity Zones
* Demand Zone (Support): $578.00 - $581.00. Buyers have shown strong interest in this area during pullbacks.
* Supply Zone (Resistance): $593.00 - $595.00. Sellers may emerge here as it aligns with previous rejection levels.
Order Blocks
* Bullish Order Block: $578.00 - $580.00. Watch for buying interest if SPY retraces to this zone.
* Bearish Order Block: $593.00 - $595.00. This area could serve as a profit-taking zone or short-term resistance.
Key Levels
* Support Levels: $578.00, $581.00, $583.95.
* Resistance Levels: $593.00, $595.00, $600.97.
Technical Indicators
* 9 EMA & 21 EMA (Hourly): SPY is trading above these levels, confirming short-term bullish momentum.
* MACD (Hourly): Bullish crossover with increasing histogram bars, supporting further upward movement.
* RSI (Hourly): Near 65, suggesting room for additional upside but nearing overbought territory.
Scalping Plan
* Entry: Look for pullbacks to $589.00 - $590.00 for a quick scalp with confirmation from bullish candles.
* Exit: First target at $592.50, with an extended target at $594.00.
* Stop-Loss: Place a tight stop at $588.00 to minimize risk.
* Game Plan: Use high-volume breakouts or retests of minor supports as entry signals. Avoid overtrading near resistance levels.
Swing Trading Plan
* Entry: Accumulate near $578.00 - $581.00 for a medium-term swing trade.
* Exit: First target at $595.00, with extended targets at $600.00.
* Stop-Loss: Set below $576.00 to protect against further downside.
* Game Plan: Monitor for consolidation above $583.95 and use pullbacks for additional entries if momentum persists.
Projection
SPY is positioned to test $593.00 in the near term, with a breakout opening the door to $595.00 and eventually $600.00. Failure to hold $589.00 could see a retest of $581.00, offering a secondary entry point for longs.
My Thoughts
SPY’s breakout signals a bullish shift, making it an ideal candidate for both scalpers and swing traders. Scalping opportunities lie between $589.00 and $593.00, while swing traders can capitalize on pullbacks to the $581.00 demand zone. Stay disciplined, and let the price action guide your trades.
Disclaimer
This analysis is for educational purposes only and does not constitute financial advice. Always perform your own research and consult with a financial professional before trading.
Market Structure Overview
* Trendline Breakout: SPY has broken a descending trendline, indicating a potential shift in sentiment toward bullishness.
* Volume Analysis: Rising volume accompanies the breakout, signaling buyer interest at current levels.
* Current Price Action: Trading near $591.40, SPY is consolidating just below a significant resistance zone.
Liquidity Zones
* Demand Zone (Support): $578.00 - $581.00. Buyers have shown strong interest in this area during pullbacks.
* Supply Zone (Resistance): $593.00 - $595.00. Sellers may emerge here as it aligns with previous rejection levels.
Order Blocks
* Bullish Order Block: $578.00 - $580.00. Watch for buying interest if SPY retraces to this zone.
* Bearish Order Block: $593.00 - $595.00. This area could serve as a profit-taking zone or short-term resistance.
Key Levels
* Support Levels: $578.00, $581.00, $583.95.
* Resistance Levels: $593.00, $595.00, $600.97.
Technical Indicators
* 9 EMA & 21 EMA (Hourly): SPY is trading above these levels, confirming short-term bullish momentum.
* MACD (Hourly): Bullish crossover with increasing histogram bars, supporting further upward movement.
* RSI (Hourly): Near 65, suggesting room for additional upside but nearing overbought territory.
Scalping Plan
* Entry: Look for pullbacks to $589.00 - $590.00 for a quick scalp with confirmation from bullish candles.
* Exit: First target at $592.50, with an extended target at $594.00.
* Stop-Loss: Place a tight stop at $588.00 to minimize risk.
* Game Plan: Use high-volume breakouts or retests of minor supports as entry signals. Avoid overtrading near resistance levels.
Swing Trading Plan
* Entry: Accumulate near $578.00 - $581.00 for a medium-term swing trade.
* Exit: First target at $595.00, with extended targets at $600.00.
* Stop-Loss: Set below $576.00 to protect against further downside.
* Game Plan: Monitor for consolidation above $583.95 and use pullbacks for additional entries if momentum persists.
Projection
SPY is positioned to test $593.00 in the near term, with a breakout opening the door to $595.00 and eventually $600.00. Failure to hold $589.00 could see a retest of $581.00, offering a secondary entry point for longs.
My Thoughts
SPY’s breakout signals a bullish shift, making it an ideal candidate for both scalpers and swing traders. Scalping opportunities lie between $589.00 and $593.00, while swing traders can capitalize on pullbacks to the $581.00 demand zone. Stay disciplined, and let the price action guide your trades.
Disclaimer
This analysis is for educational purposes only and does not constitute financial advice. Always perform your own research and consult with a financial professional before trading.
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