IWM and SPY tell different stories - What next for U.S. markets?
I have been wondering if IWM is still a leading indicator (linked chart). Today while everyone is celebrating new highs in SPY - media talking about the coming economic boom - IWM is quietly resisting the 20sma and looks like it wants to move lower.
The orange circle shows that RSI dipped below 50, bounced above on 8 Apr (retest), and is below again today. 10ema is still below the 20sma. A lower close on Monday should move IWM lower.
This big question is whether this leads SPY lower also. You can see price is up to the orange line on weekly SPY, and every other time price was this high and RSI 14-day rose to 70 there was a pullback. So at the very least, I am looking here for a pullback. Directional volume indicator on SPY daily also supports a pullback due to buyer exhaustion.
The orange circle shows that RSI dipped below 50, bounced above on 8 Apr (retest), and is below again today. 10ema is still below the 20sma. A lower close on Monday should move IWM lower.
This big question is whether this leads SPY lower also. You can see price is up to the orange line on weekly SPY, and every other time price was this high and RSI 14-day rose to 70 there was a pullback. So at the very least, I am looking here for a pullback. Directional volume indicator on SPY daily also supports a pullback due to buyer exhaustion.
