At 1:50 on Wednesday, the first of two high wick or long upper shadow candles formed on the ten minute SPDR S&P 500 (SPY) chart. It looked like a tradeable pullback was coming, similar to the one that followed the eveningstar reversal pattern that formed just after 11:00 and took price back to the VWAP, but instead there was a ramp up into the final hour of trading.
On Thursday the ETF was tracking lower going into the final two hours of the session and there was a rebound that saw the broader market rally into the close. Then, in the final session of the week, the 234.40 level acted a solid resistance for most of the day, until around 2:00 when the SPY broke above that level and rallied into the end of the trading week.
These small reversals in price had a larger effect on the appearance of the daily candles. In the case of Friday’s candle, instead of a large bullish white candle forming, a high wick or upper shadow shooting star candle would have formed suggesting an inability to hold all-time high levels — what would have been a clearly cautious candle.
Does this price action suggest machine manipulation or simply reflect the dynamics of a momentum driven market? I think the latter, but either way it is tough to trade.