• Where is Possible Support for SPY?

    by  • October 23, 2012 11:49 am • Quick Hits • 0 Comments

    The SPDR S&P 500 (SPY) is down nearly 5 percent from its September peak.  The sell-off today has almost filled in the gap from September 6, which happened to be the day the European Central Bank (ECB) announced its major bond-buying program — which was, hence, a big up day for our markets.  The following week, our own Fed announced QE3, which also spiked the markets up further.  The charts below (click to enlarge) illustrate my possible support areas for the SPDR S&P 500 ETF (SPY) :

    • Rising 80-day moving average (purple line) could offer support, as it has in the past
    • March-May highs coincide around the $140 level
    • The current sell-off has retraced almost 38.2 percent of the recent summer (to early fall) move higher
    • Enormous peak put open interest for the November series resides at the 140 strike


    Tony Venosa, CMT is a Senior Options Strategist and works on the trading desk at Schaeffer’s Investment Research. He joined Schaeffer’s in 2010. He has worked in the finance industry for over 15 years. He began his career as a trading assistant in Chicago on the floor of the Chicago Mercantile Exchange. He later moved upstairs and worked as a commodities broker on both the retail and hedging side. He left the brokerage industry to begin his trading career as a proprietary equities trader at a Chicago firm. In 2000, Tony moved backed to his hometown and continued trading his personal account. He later went on to earn his Chartered Market Technician designation. He earned a B.S. in Finance from Miami University. Tony’s main focus is short-term directional option trading.


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