The investment seeks to correspond generally to the price and yield performance, before fees and expenses, of the S&P 500 Index. SPDR Trust is an exchange-traded fund that holds all of the S&P 500 Index stocks. It is comprised of undivided ownership interests called SPDRs. The fund issues and redeems SPDRs only in multiples of 50,000 SPDRs in exchange for S&P 500 Index stocks and cash.
It has been a rough week for the SPY and the QQQQ. There are two important supports we need to look at here.
The first is the blue line. This is the short term support that was formed as the SPY leveled out a bit more in December. For a couple weeks it looked like it was gaining momentum again and moving up. But then it broke through that support in the reactionary move on Obama's speech about regulating banks.
The second is more important though. We may be able to dismiss the first as reactionary and look for a recovery, but not the red line. The read line is the longer term support that goes way back. We broke through that this week. This confirms a bearish lean in the SPY. If that is not enough, the weekly chart,
first the first time in along time shows the SPY breaking through the middle of the Bollinger band.
This is all the more reason to be very cautious on how we play the market so we know where it is going.