spx/spy

These indices are at an inflection point because we may break the trend line that has been in place since January of this year, or we may immediately rebound back to 400 points or below. Yesterday, $S&P 500 Index(.SPX.US)$ and $SPDR S&P 500 ETF(SPY.US)$ (As an ETF that tracks stock indexes) closed above the 200 EMA, which has been a key level of rejection since the last time the bear market rebounded:

Additionally, SPX/SPY is currently forming an ascending wedge bearish pattern — which suggests it has some room to go to the 410-415 region. This will be highly dependent on PCE printing, which is expected to drive the market a few points in one direction. Yesterday, Federal Reserve Chairman Jerome Powell hinted that May was hot, which may mean it was higher than the 6.2% forecast (YoY). Thermal printing will drive the market down, and printing below expectations may cause the market to rise above the trend line and enter the 415 area, which will mean a break in the trend line. If we pull back and close above the trend line, this would mean a further rise towards the 4,200 area in the next few days.

The ideal trading idea for today is to trade across levels at the current prices (i.e. 407C and 407P). Expectations seem to be trending bullish, and yesterday's subscription volume was the highest in a while.

However, one thing caught my eye:

Yes, the Fear and Greed Index. The index is now higher than the August bear market rebound and is the highest level in the past year or so, even though SPY targets 470 points. However, CTA is still shorting $Powershares Exchange Traded Fd Tst Db Us Dollar Index Bullish Fund Etf(UUP.US)$ (An article tracking the DXY will be published soon) Tends to be bearish $CBOE Volatility S&P 500 Index(.VIX.US)$ Looking for tags below 20, it hasn't done that in a long time.

At this point, some things have to be given up. Either we pull back on a bad PCE print, or we rocket to the 415 area and we experience a sharp pullback from here. Cross-term trading is the best strategy to hedge against anticipated fluctuations in any direction.