SPY confirms a double top at 184.69/184.94; Looks to retest 177.64/177.51/177.32 key support zone near 38.2% retrace and bull trendline

SPY (SPDR S&P 500 ETF Trust) ($178.89)

January 26, 2014

---------------------------------------------------------------------------------------------------------------------

SPY confirms a double top at 184.69/184.94;

181.75/181.66/181.34 reverts to resistance area;

Looks to retest 177.64/177.51/177.32 key support zone near 38.2% retrace and bull trendline

--------------------------------------------------------------------------------------------------------------------

SPY:  Confirmed a double top at 184.69/184.94 on the break below 181.31 range support on Friday; the 181.75/181.73/181.34/181.66 now reverts to resistance area. Weakening momentum and bearish divergence both point lower. Bears look to retest the cluster of supports including 178.08 double top target (not shown, 184.94/181.34 from 181.66), 177.32 (12/18/13 reaction low), 38.2% of the upmove from 10/9/13 low (164.53/184.94 rise), 100 day moving average at 176.38, and 14-month bull trendline from November 2012 low (connects 11/16/12 and 10/9/13 lows) and 50% of the 164.53/184.94 rise, which should hold.

If SPY bounces off the support zone, that would prolong the consolidation and reopen the 181.75 (11/29/13 range high/181.66 (1/24 daily high-gap low)/181.34 (1/13 range low) short-term resistance area.

If SPY decisively breaks below the support zone, medium-term supports rest at 173.60 (9/19/13 high) near 23.6% of the entire upleg from 11/12/16/12 low (134.70/184.94), 170.97 (8/2/13 high) /169.07 (5/22/13 high) near 50% of the upmove from 6/24/13 low (155.73/184.94) and the 200 day moving average.

Long-term supports lie at 164.53 (10/9/13 higher low) near 38.2% of entire upleg from 11/12/16/12 low (134.70/184.94) and 159.71 (4/11/13 high)/160.22 (7/3/13 low) near 50% of entire upleg from 11/12/16/12 low (134.70/184.94)

 

Momentum: Daily – Sell mode; Weekly – Sell mode; Monthly – Buy mode (Overbought)

Resistance:

184.69 (12/31/13 high)/184.94 (1/15 record peak) double top area

181.75 (11/29/13 range high/181.66 (1/24 daily high-gap low)/181.34 (1/13 range low)

 

Support:

177.64 (11/7/13 range high) /177.51 (10/30/13 range high)

177.32  (12/18/13 reaction low) near 38.2% of the upmove from 10/9/13 low (164.53/184.94 rise) and 100 day moving average

174.76 (11/7/13 low) near 14-month bull trendline from November 2012 low (connects 11/16/12 and 10/9/13 lows) and 50% of the upmove (164.53/184.94)

173.60 (9/19/13 high) near 23.6% of the entire upleg from 11/12/16/12 low (134.70/184.94)

170.97 (8/2/13 high) /169.07 (5/22/13 high) near 50% of upmove from 6/24/13 low (155.73/184.94) and the 200 day moving average

164.53 (10/9/13 higher low) near 38.2% of the entire upleg from 11/16/12 low (134.70/184.94)

159.71 (4/11/13 high)/160.22 (7/3/13 low) near 50% of entire upleg from 11/16/12 low (134.70/184.94)

157.52 (10/11/2007 peak) near 23.6% the entire upswing from March 2009 low (67.10/184.94)