Index Checkup and SPY Issues

By | June 23, 2015

The major indices reversed their Friday losses in Monday’s session, with the NASDAQ Composite and the Russell 2000 Index, closing at all-time levels. High wick or moderately high wick candles formed on the DOW and S&P charts, which make some suggestion that those indices were unable to hold what would have been new highs for the month, and the NAZ and Russell ranges were narrow with most of their gains coming off the opening gap.

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66623.SPY

On the SPY daily chart a “gravestone” doji formed at the top of its channel range. This candle has a narrow opening and closing range situated at the bottom of its overall range. It reflects price that was pushed higher early in the session by the bulls, but rejected and later taken down by the bears. A single doji represents indecision. Volume on the SPY was 33.6% lower than the 50 day moving average of volume.

These observations may be too fine-tuned because the resistance lines taken out last week on these index charts remain intact and the overall trend is still higher, but watch the volume readings on SPY, as it further tests the channel top.

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