Not many sellers out there
There is no change in SPY as the ETF edged higher on Monday. Trading remains thin, but there are still more buyers than sellers out there. Even though low volume levels, overbought conditions and sustainability may be a concern, there can be no turn until selling pressure overcomes buying pressure. SPY forged a higher high in mid November, held its gains with a 5 week trading range and then moved to another new high the last few days. This is simply proof that buying pressure is stronger than selling pressure.
On the 30-minute chart, the right half of the five week trading range looks like a symmetrical triangle. SPY broke above triangle resistance with a gap and surge above 111.5 early last week. The advance continued the rest of the week for a classic Santa Claus rally. Broken resistance around 111-111.5 turns into a support zone and this is the first area to watch for signs of weakness.
