We’re waiting for Big 3 sell signals to appear on the S&P 500 (SPY) as it has a negative moving average crossover, with the daily 21 exponential moving average (EMA) below the 50 simple moving average (SMA).
The Russel ETF (IWM) has a negative MA cross but was able to hold support on Friday.
The semiconductor sector (SMH) has both a negative moving average crossover and daily Big 3 sell signals, taking out recent support last week. This points toward the market gearing up for a move toward the June lows.
HYG has negative Big 3 sell signals, indicating the market will likely head lower. The DXY has a daily squeeze looking poised for a breakout, which would ultimately send the market lower as well.
Keep in mind on Wednesday we have the FOMC statement, where Federal Reserve Chairman Jerome Powell will give a Fed update.
The market will likely head toward the June lows, but we could see a bounce.
Price on the SPY daily chart is at -3 average true range (ATR) moves and is very oversold on the SPY hourly chart. This means there is a potential for an oversold bounce. Ultimately, if SPY can’t find support at the $390 level, the market will roll over to the June lows.
In the video above, we’ll review potential trade ideas we’ll look to enter in the coming weeks, the conditions on various sectors, and our recently closed positions and bigger-picture account growth in the Compounding Growth Mastery.
Stay Focused!