Explain Market Movement? SPY?

[mii]

Guys , why did spy make huge downward move and then huge upward move . News is that inflation still exists but it didnot increase . I was hoping an upward move in the morning but was not able to understand what’s the reason for downward move ? Any analysis ?

 

[rad14733]

SPY, an ETF, moves much the same as SPX, the index of the S&P 500, so it will move with the overall stock market... Personally, I don't care so much about the "why" anymore because I simply scalp SPY Options in accordance with what the market presents... I don't over-analyze the market these days, I just trade what comes along...

Compare SPY and SPX to what the Mag-7 Stocks (AAPL, AMZN, GOOGL, META, MSFT, NVDA, TSLA) do and you'll see that more times than not they all move in the same direction at the same time... Hoping or attempting to predict what the market will do is an act of futility for the most part...

Do you trade SPY or SPY Options, or just curious...???

 

[deansterling]

Guys , why did spy make huge downward move and then huge upward move . News is that inflation still exists but it didnot increase . I was hoping an upward move in the morning but was not able to understand what’s the reason for downward move ? Any analysis ?

If you look at the Daily timeframe we are overall bullish and it looks like the downward move was a liquidity sweep to run stops then move the price in the intended direction which is currently in an uptrend (although the market is looking a little toppy to me). The marketmakers/algos like to target liquidity pools.

 

[mii]

If you look at the Daily timeframe we are overall bullish and it looks like the downward move was a liquidity sweep to run stops then move the price in the intended direction which is currently in an uptrend (although the market is looking a little toppy to me). The marketmakers/algos like to target liquidity pools.

I understand , thank you ..

 

[mii]

SPY, an ETF, moves much the same as SPX, the index of the S&P 500, so it will move with the overall stock market... Personally, I don't care so much about the "why" anymore because I simply scalp SPY Options in accordance with what the market presents... I don't over-analyze the market these days, I just trade what comes along...

Compare SPY and SPX to what the Mag-7 Stocks (AAPL, AMZN, GOOGL, META, MSFT, NVDA, TSLA) do and you'll see that more times than not they all move in the same direction at the same time... Hoping or attempting to predict what the market will do is an act of futility for the most part...

Do you trade SPY or SPY Options, or just curious...???

I understand markets are volatile and unpredictable . analyzing sure helps where to enter the trade for me. Like you said just playing what is presented is safe and good for scalping . Today Iam in a long trade and it was successful . Still figuring out which trading style best fits me . Thank you for the inputs very helpful info .

 

[autoloader]

I thought the whole day was rather bizarre. A slow low-vol grind lower for the first three hours followed by a slow low-vol grind higher for about three hours capped off with a massive spike higher in the last half hour. I don't remember ever seeing anything quite like that before. I guess it had something to do with the end of the month and possibly options expirations.

 

[Carl-not-Karl]

Guys , why did spy make huge downward move and then huge upward move . News is that inflation still exists but it didnot increase . I was hoping an upward move in the morning but was not able to understand what’s the reason for downward move ? Any analysis ?

May 31 was last day of month: institutional rebalancing (Mutual Funds, Indexes, brokerages, etc.)
...and May 31 being a Friday which recently has been known as "Crush VIX Friday".
...and summer doldrums about to start: "Sell in May and go away".

| SPY | -VIX (inverted) | SPY with VIX (inverted) |:

 

[mii]

May 31 was last day of month: institutional rebalancing (Mutual Funds, Indexes, brokerages, etc.)
...and May 31 being a Friday which recently has been known as "Crush VIX Friday".
...and summer doldrums about to start: "Sell in May and go away".

| SPY | -VIX (inverted) | SPY with VIX (inverted) |:

View attachment 22008

Great info. Thank you..!!