SPY continues its upwards momentum following the uptrend it started on 1/15. This uptrend has acted as support and allowed SPY to continue to break through resistance. On Monday we noted to watch if SPY can get above 150 and 150.25, which it has and SPY has continued to move upwards. SPY has little resistance as it continues higher with the next potential stopping point at 151.49. Still SPY needs to continue to make new highs and follow that trendline in order to maintain this upwards movement. Stalling near these levels is dangerous and could lead to a pullback. One should be cautiously long. 149.54 is a key support level to watch, while it is not visible on the daily chart this level on the hourly and minute charts has been key support, along with the trendline. If this level breaks a pullback is likely.
One concern that about this recent rally is the divergence in the McOssilator. There is a negative divergence that is occurring between SPY’s new highs and NYMO. One would want the McO to be making highs with the market showing that internals are also behind this market. Watch to see if NYMO goes lower today, if it does it would make a new low.