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SPY 1-Hour Chart Analysis: Uptrend Intact, but Warning Signs Emerge

Written By: JasonX

September 30, 2024

Based on the analysis of the SPY 1-hour chart:
The market has been following a consistent pattern of rallying until it breaks below the medium-term (blue) moving average, which then triggers a period of weakness. This weakness can manifest as a pullback, consolidation, or a more significant sell-off.

Currently, SPY is still trading above this moving average, indicating that the uptrend remains intact. However, there are signs that this trend may be nearing its end:
Momentum indicators like the stochastic oscillator and Relative Strength Index (RSI) are showing clear signs of slowing down.

A bearish divergence has formed on the 1-hour chart’s RSI.

These factors suggest that the near-term uptrend may be approaching its conclusion, and a period of weakness could be imminent. However, it’s important to note that for a pullback to begin, the price needs to break below the medium-term moving average first.

Traders should watch for a potential break below this moving average as a signal that the period of weakness may be starting. Until then, the uptrend remains in place, despite the warning signs from momentum indicators.

https://www.youtube.com/@meanreversiontrader

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