How To Play This Extended Run In The S&P 500 (SPY)

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October 13, 2017 6:17am NYSE:SPY

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From Corey Rosenbloom: Will we ever get a pullback in this extended market?  It sure feels like we won’t.

In the event that we do, what does the Volume Profile Chart reveal about the levels to watch?

I’m so glad you asked!

With the S&P 500 (SPX) running strongly up away from the prior consolidation zone, there’s very little in the way of volume support nodes after the breakout beyond 2,505.

A small volume “hump” (distribution) node occurs just beneath 2,549 where the market trades currently.

We’ll use this as our short-term focal point for intraday trades.

For swing traders, however, the next low price target in terms of the Volume Profile is our new 2,505 level along with our old (prior) 2,495 level as seen from the red line (highest volume node) and distribution.

What’s the plan here?

Continue ignoring every bearish indicator and logic itself UNTIL price ACTUALLY breaks beneath the steeply rising trendline and/or moving averages.

Only then can you play for lower targets on a pullback in this rare “extended run” environment.

The SPDR S&P 500 ETF Trust (SPY) rose $0.15 (+0.06%) in premarket trading Friday. Year-to-date, SPY has gained 14.97%.

SPY currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 123 ETFs in the Large Cap Blend ETFs category.

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