Before The Open
‘Tap & Go’ Reversal
The last update on the S&P (SPY), said it was normal market behavior to bounce off a ‘spring’ set-up.
That’s just what we got.
Price action launched off the spring and ‘appears’ to have confirmed the underside of the 50-day Moving Average.
I say ‘appears’, because like many things in the markets, the moving averages are just another ruse.
They have no power (or meaning) of their own.
As my former mentor David Weis (now deceased) used to say: “They just confuse the situation.”
So, let’s get on to the price action.
S&P (SPY) Wyckoff Analysis:
What we have with yesterday’s action, is confirmation of an axis line that has now become resistance:
Volume has pulled back when compared to the prior session; indicating indecision or lack of commitment from the bulls.
We’ve just had confirmation of resistance.
At this juncture, price action was not able to penetrate and hold above that level.
If SPY, is to head higher from here, it’s up to the bulls to somehow find the energy to launch an assault on the resistance.
It could happen but is it probable?
The Fibonacci 61.8%, retrace level is just above resistance (not shown).
The market could drift and grind it’s way to that Fib level before a final reversal.
We’ll keep an eye on it.
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