Weekly Chart of the S&P 500 Via SPY

by Geoff Garbacz | 05/20/2020 7:58 AM

We update each week in Superstock Investor our look at the S&P 500 via our favorite chart of SPY through Tuesday's close.

The Weekly Displaced Moving Average (DMA) Channel (Yellow Band) sees the current price above the channel. As such, bias is positive with a breakout above the channel. It turned positive at the end of April.

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Second, the Erlanger Volume Swing (EVS) is at 2.39 from 0.85. Above 0 is good and below 0 is bad. The current action is now mixed. This indicator tracks whether there are more buyers than sellers.

Third, the Erlanger Crossover Spread (EC) Spread is now positive at 47.38 from 61.93. Still positive but losing a little bit of steam.

Last,the Erlanger Trend Direction (ETD) moves from uptrend to pullback. We need to watch this deterioration for further signs of a bigger pullback.

So what is an investor to do here? We would recommend selective buys here.

Positioning in our Morning Matters Portfolio off this chart and several other indicators moved to 100% cash on February 28th (see Flash Alert #446). We look to starting new buys on the next pullback.