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10/27/2023 |

Market Update Into October 30th: Bulls In Shambles

The pain continued for the bulls this week, with all three major indexes closing at or near lows for a second week. The markets now appear increasingly vulnerable, with the potentially bullish flag patterns we’ve been tracking on SPY and QQQ for the past few months beginning to fail to the downside. If there’s any glimmer of hope here, it might be found in Short Volume, which has seen a clear decrease over the past week, suggesting less interest from traders in initiating new short positions. Next week, the earnings announcements continue from tech heavyweights AAPL and AMD, as well as many other notable names. Let’s dig into the charts and see where we landed!

Weekly Analysis

This week, the SPY ETF closed at $410.73 (-2.49%), right at the volume point of control anchored from the beginning of 2023. This week also marks the first weekly close below the lower Bollinger Band since September of 2022.

This is a weekly chart of the SPY index.

This week, the QQQ ETF closed at $345.42 (-2.62%), dipping its toes right into the lowest volume node on the year-to-date profile. This is the first week that this index has closed below the weekly Bollinger Band since June of 2022. Of note also is the failure below the important 50 level on the RSI indicator. 

This is a weekly chart of the QQQ index.

This week, the IWM ETF closed at $162.25 (-2.54%), putting in a three-year low and its second weekly close below the lower Bollinger Band. This index is nearing oversold levels on the RSI indicator not seen since June of last year. The next potential level of interest is the .618 Fibonacci retracement measured from the Covid low to the all-time high, around $153.

This is an image of the weekly chart of the IWM index.

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