The SPDR S&P 500 ETF Trust (SPY PY SPY ) is testing its quarterly pivot at 430.21 with its annual pivot at 434.40. Its above a golden cross on its daily chart that was confirmed on February 3, 2023. SPY has a positive but extremely overbought weekly chart with a stochastic reading of 94.17, well above 80.00 on a scale of 00.00 to 100.00.

The Daily Chart for SPY

Courtesy of Refinitiv XENITH

The daily chart for SPY shows a decline of 27.4% from a high of 479.98 set on January 4, 2022, to the low of 348.11 set on October 13, 2022. During this decline a death cross formed on March 14, 2022, when the 50-day simple moving average fell below the 200-day simple moving average.

After a low of 362.17 on June 17, 2022, there was a rebound to 431.73 on August 16, 2022, which was a failed test of the 200-day simple moving average. From this test the downside reached its two-year low of 348.11 set on October 13, 2022.

The rebound from this low began a bull market rise of 24% to the high of 431.99 set on June 9, 2023. This was between its quarterly pivot at 430.21 and its annual pivot at 434.40. These are the two horizontal lines in the middle of the chart. The horizontal lines above are the monthly risky level at $451.73 and the semiannual risky level at 460.29.

The Weekly Chart For SPY

Courtesy of Refinitiv XENITH

SPY has a negative and extremely overbought weekly chart with the ETF above its five-week modified moving average at 421.09. It’s well above its 200-week simple moving average, or ‘reversion to the mean’ at 380.32. The 12x3x3 weekly slow stochastic reading is rising above the overbought threshold of 80.00. The reading at 94.22 is above the 90.00 reading on a scale of 00.00 to 100.00 indicating that the ETF should not be bought at this time.

Trading Strategy: Buy weakness to its ‘reversion to the mean’ at 380.32. Reduce holdings on strength to its semiannual risky level at 460.29.