SPY head and shoulders top in play

All right, good day, folks. Today we’re gonna take a look at the s&p or spy. And I was looking at both the weekly and daily charts of the s&p and I noticed something from a technical perspective that I wanted to run against the smart seasonal software. So you can see we have a shorter calendar window here that starts on around Jan 27. Through the first of February only 656 calendar day holds a 80% win rate. So why did I come to the smart market scanner to look for potentially bearish signals is because we have this going on. So let’s take a look at the weekly chart. First, you can see we have this long term upward sloping channel in the path of least resistance is to the downside. So yes, we can continue to PING and PONG back and forth in this channel. But the more elevated we get, the more steep we get the more likelihood of a pullback, which can be rather stiff, they say stairs up and elevator down, and would not be surprised to see something similar to happen in indices, especially if we get some type of surprise news or announcements that could further amplify the move down looking at the Daily aside from this channel index that we have, we come over to the daily chart, we have what appears to be a very solid, developing Head and Shoulders top. So we had a right shoulder here at the 470 area and at 480, right shoulder here about the 474 73 area, our neckline comes in right around this area below around the 455 area. And then watch this, you’ll see that our expected profit objective is a measurement from the top of the head down to the neck and then measured that equal distance lower from the neckline. So I’m going to copy that same link. And we’re going to take this and we’re going to come down. And that takes us right into our next area of structure, which is of no surprise, this would be an area that we would have marked up from the beginning anyway, here at the 430 area. But the head and shoulders top projects a move down to this area anyway, same thing with the 123 top, we break below 455 We could have a little bit of support come into play at 450. Below that we are likely coming down to the 430 area. So this message is not to scare anybody or or tell you to sell all your positions and we’re going short. It’s simply a matter of simple technical analysis, trading alongside historical seasonality, which we have here in the s&p looking waiting and watching for a potential short to occur. If we get our confirmations here on the technicals now, this is something we’ve been talking about since the end of December, specifically x l k. And the Q’s, which we call for potential weakness and shorts right around here in this area at the end of December, early January, which we were able to take short positions. So hope this analysis helps if you’d like to learn about how we do this each and every week not only on indices, but on individual stocks and commodities as well. I’m going to drop you a link to a trial and I look forward to seeing you on the inside