This week, the SPY ETF reached a new all-time high, closing at $609.70 (+1.47%). After an initial drop on the CPI announcement, it found strong support at the 50-period SMA and rebounded with significant bullish momentum.
As seen in the breadth indicator, about 50% of stocks in the index are trading above their 50-SMA. To sustain this rally, traders should watch for an expansion in breadth as a key confirmation signal.
SPY – SP 500 Index
QQQ
Amid high inflation data, the tech-heavy QQQ ETF maintained strong bullish momentum, closing at $538.15 (+2.91%) and nearing its all-time high. Notably, its 50-SMA breadth expansion is outpacing that of the SPY, signaling more decisive participation from the megacaps.
This, combined with a rebound off the 50-period SMA, is helping add fuel to the rally.
IWM (iShares Russell 2000)
The IWM ETF lagged behind once again this week, closing relatively flat at $225.97 (+0.004%). Unlike its peers, it is rejecting its 50-period SMA, with weaker breadth.
This index is more vulnerable to hot inflation, as higher interest rates weigh heavily on small-cap companies. For bullish momentum to develop, traders can watch for the index to gain and hold its 50-period SMA.
