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Why SPY Could Hit New All-Time Highs

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The following is an excerpt from the most recent edition of our Off the Charts newsletter:

It was tough to see this one coming.

After reversing to finish on the lows Wednesday, SPY gapped up Thursday morning.

And following a small, quick pullback, it took off running higher straight through into the afternoon.

It reclaimed the 20 day sma (234.71) — barely even pausing — and continued up above the 50 day sma (235.46). It settled into a relatively tight range above the 50 day sma for most of the afternoon but dropped right before the bell to finish a few cents underneath it. The move as on above average volume.

So a week of bearish action was wiped out in one face-ripping rally.

Reclaiming the moving averages was a big positive for the bulls.

If they hang on or start to push higher, SPY looks like it could be set up for a more substantial run towards new all-time high.

Finishing flat/green today would confirm today’s move and technically remove most of the short-term resistance on the chart.

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