SPY (S&P 500 ETF) Short Setup – Retracement Opportunity
Overview:
The SPY (S&P 500 ETF) shows a potential short opportunity, leveraging a confluence of Elliott Wave and Fibonacci resistance. This setup aligns with a bearish corrective pattern, presenting a chance to capture downside momentum amidst macroeconomic uncertainties.
📊 Technical Analysis:
Elliott Wave Structure:
Wave W completed with a sharp decline, followed by a retracement in Wave X.
Anticipating the continuation of Wave Y lower, targeting Fibonacci extensions.
Fibonacci Levels:
Entry Zone: $598.33–$599.23 (between the 61.8% and 65% retracement).
- Stop-Loss: $606.64 (above the 88% retracement to account for false breakouts).
- Target 1: $585.78 – Aligns with prior support and Fibonacci extensions.
- Target 2: $570.14 – Extended target toward the 1.618 projection.
Short Zone Confirmation:
The short zone aligns with key resistance levels that previously rejected bullish attempts.
🌐 Macro Overview:
Economic Indicators:
Rising treasury yields and persistent inflation concerns are weighing on equities, particularly large-cap indices.
The Federal Reserve's hawkish stance on interest rates adds pressure to SPY's bullish outlook.
Seasonal Trends:
Historical December pullbacks in risk assets during rate-hike cycles favor bearish scenarios.
Market Sentiment:
Investor sentiment remains cautious, with increasing volatility indicating indecision in the broader market.
📈 Trade Plan:
Short Entry: Wait for price action to retrace into the short zone ($598.33–$599.23).
Risk-Reward: Targeting a 3:1 risk-reward ratio with both short-term and extended profit targets.
Caution: Monitor fundamental announcements such as labor market data or Federal Reserve statements, as these could drive volatility and invalidate the setup.
📌 Final Thoughts:
SPY offers a clean technical setup supported by a bearish macro narrative. This trade allows for tight risk management while capturing a potential extended downside move.
Let me know your thoughts or if you'd trade this setup differently! 🚨📉
The SPY (S&P 500 ETF) shows a potential short opportunity, leveraging a confluence of Elliott Wave and Fibonacci resistance. This setup aligns with a bearish corrective pattern, presenting a chance to capture downside momentum amidst macroeconomic uncertainties.
📊 Technical Analysis:
Elliott Wave Structure:
Wave W completed with a sharp decline, followed by a retracement in Wave X.
Anticipating the continuation of Wave Y lower, targeting Fibonacci extensions.
Fibonacci Levels:
Entry Zone: $598.33–$599.23 (between the 61.8% and 65% retracement).
- Stop-Loss: $606.64 (above the 88% retracement to account for false breakouts).
- Target 1: $585.78 – Aligns with prior support and Fibonacci extensions.
- Target 2: $570.14 – Extended target toward the 1.618 projection.
Short Zone Confirmation:
The short zone aligns with key resistance levels that previously rejected bullish attempts.
🌐 Macro Overview:
Economic Indicators:
Rising treasury yields and persistent inflation concerns are weighing on equities, particularly large-cap indices.
The Federal Reserve's hawkish stance on interest rates adds pressure to SPY's bullish outlook.
Seasonal Trends:
Historical December pullbacks in risk assets during rate-hike cycles favor bearish scenarios.
Market Sentiment:
Investor sentiment remains cautious, with increasing volatility indicating indecision in the broader market.
📈 Trade Plan:
Short Entry: Wait for price action to retrace into the short zone ($598.33–$599.23).
Risk-Reward: Targeting a 3:1 risk-reward ratio with both short-term and extended profit targets.
Caution: Monitor fundamental announcements such as labor market data or Federal Reserve statements, as these could drive volatility and invalidate the setup.
📌 Final Thoughts:
SPY offers a clean technical setup supported by a bearish macro narrative. This trade allows for tight risk management while capturing a potential extended downside move.
Let me know your thoughts or if you'd trade this setup differently! 🚨📉
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