SPY Charts 6/20 Rally Topping Out

The last few weeks it has been speculation and rumor that has driven the markets up.  The bailout of Spanish Banks,  the Greek elections averting a disaster, and the Fed extending Operation Twist.  With all these items out of the way the market has to digest the rising yields in Spain.  This a very big concern to the Europeans and the market.  We should see a top on the SPY as the FOMC meetings finish tomorrow and we might see even a slight bump on the SPY, but after tomorrow there is no more rumor or hope for good news in the next two weeks.  The only thing that could help boost the market is positive economic news. 

The only problem with that is jobs are stagnant and firms are not hiring at the pace they were back in the fall.  All of this looks like a market topping the rally we have had the last couple of weeks.



The formation at the top of this rally is a bearish swing trading formation, not to mention that the SPY is trading right into resistance.  The move last year into $135 is similar to what we are seeing now and could indicate that the SPY is ready to give up some gains from the the last two weeks. 

The rest of this week might see the SPY hover around $135 but in serious break below $134.50 will be a bearish sign and traders should start to look for more bearish opportunities.

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Disclaimer: This article is intended to be informative and does not constitute a buy, hold, or sell recommendation., and should not be construed as personalized advice as it does not take into account your specific situation or objectives