The S&P 500 ETF (SPY) is buying and selling round $684, hovering precariously close to its 20-day transferring common after a unstable November selloff that rattled bulls and raised questions concerning the sustainability of 2025’s spectacular rally.
However now the burning query is:
Will SPY reclaim its uptrend and push towards new highs above $690, or is that this consolidation the calm earlier than one other leg down towards the 50-day EMA?
S&P 500 ETF (SPY): Day by day Chart
SPY’s pattern stays bullish however is in a maturing, grinding advance with momentum fading and value weak to a deeper imply‑reversion towards the 50‑ and even 200‑day EMA if help offers method.
Development and Construction
The day by day chart reveals a robust uptrend that dominated most of 2025, with SPY surging from the April lows close to $480 to current highs round $690, a acquire of over 40% for the yr.
Value stays above all three key exponential transferring averages (EMAs), with the 20-period EMA at $679.51, the 50-period EMA at $674.14, and the 200-period EMA at $636.50.
The bullish stacking of those indicators, the place shorter-term averages are above longer-term ones, confirms the medium-to-long-term uptrend stays technically intact.
Nonetheless, the November motion tells a extra nuanced story.
SPY skilled a pointy selloff and noticed the index plunge from the $690 space down to check the $640 area, a decline of roughly 7% that triggered widespread concern a few deeper correction.
However right here’s the factor: the next V-shaped restoration has introduced the worth proper again to the EMA cluster, suggesting robust underlying demand at decrease ranges.
The market bounced decisively off the $640 help zone and has now reclaimed each the 50-day and 20-day EMAs.
The present value motion reveals SPY consolidating in a decent vary between $680 and $690, with comparatively indecisive candlesticks forming over the previous a number of classes.
This sort of consolidation after a pointy decline and restoration usually precedes both a breakout continuation or a retest of current lows.
Momentum and MACD Evaluation
The MACD indicator at the moment reads -0.48, residing in damaging territory and signaling a lack of bullish momentum in comparison with the robust readings seen all through the summer time and early fall rally.
The MACD histogram reveals the indicator not too long ago crossed under its sign line, producing a bearish crossover that coincided with the November selloff.
Whereas the MACD has stabilized and is now not diving deeper into damaging territory, it hasn’t but turned constructive or generated a bullish crossover that will affirm renewed upside momentum.
This divergence between value motion (which has recovered considerably) and momentum (which stays damaging) creates an attention-grabbing technical setup.
Both momentum will meet up with value and generate a bullish MACD crossover to substantiate the restoration, or value will roll over to align with the weaker momentum image.
The histogram bars present diminishing promoting strain, however haven’t but flipped to point out significant shopping for momentum.
This neutral-to-slightly bearish momentum studying suggests warning for aggressive bullish positions till we see clearer proof of momentum confirming the worth restoration.
Key Assist and Resistance Ranges
Resistance ranges to observe:
- Rapid resistance: $688-$690 (current consolidation highs)
- Main psychological stage: $700 (spherical quantity, untested territory)
- Prolonged goal: $710-$720 primarily based on channel projection if breakout happens
Crucial help ranges:
- First line of protection: $679-$680 (20 EMA, present consolidation ground)
- Dynamic help: $674 (50 EMA, efficiently held throughout current restoration)
- Sturdy help zone: $660-$665 (earlier consolidation space from October)
- Main help: $636 (200 EMA, key long-term pattern indicator)
- Crucial help: $640-$645 (November low, line within the sand for bulls)
The 20 EMA at $679.51 is the speedy stage to observe.
A decisive break under this could probably set off a retest of the 50 EMA at $674, whereas a maintain above it retains the door open for a retest of the $690 resistance.
The November low round $640-$645 now serves because the important help that should maintain to keep up the general bullish construction.
A break under that stage would sign that the correction has extra room to run and will goal the 200 EMA at $636 and even the psychological $600 stage.
Buying and selling Outlook and Threat Evaluation
SPY is at a crossroads, consolidating close to key short-term transferring averages with conflicting indicators between value restoration and momentum weak point.
The present setup presents alternatives for each bulls and bears, however requires endurance and exact danger administration given the blended technical image.
Threat-reward at the moment favors ready for a transparent directional break somewhat than forcing trades on this consolidation zone.
Bullish State of affairs
A decisive break and shut above $690 would affirm that the November selloff was merely a wholesome correction inside a bigger uptrend. This might goal the psychological $700 stage and probably $710-$720 as prolonged aims.
If this situation performs out, we’d count on to see the MACD generate a bullish crossover and transfer again into constructive territory, confirming the momentum shift.
The basic backdrop of resilient financial knowledge, potential additional Fed charge cuts in 2026, and year-end positioning flows would help this consequence.
Bulls would acquire confidence if SPY can keep help above each the 20 EMA and 50 EMA, preserving the higher-low construction intact.
A breakout above $690 on robust quantity can be the set off sign for brand spanking new lengthy entries.
Bearish/Correction State of affairs
The damaging MACD studying and the failure to convincingly reclaim the prior highs recommend the November selloff might have been greater than only a shakeout.
If SPY breaks under the $679-$680 help zone and the 20 EMA, it will probably set off a retest of the 50 EMA at $674.
A extra important concern would come up if value breaks under $674, which might speed up promoting towards the $660-$665 zone and even the November lows at $640-$645.
The weakening momentum proven by the MACD helps the opportunity of at the least a retest of the decrease finish of this vary.
Bears on the lookout for quick alternatives or these wanting to purchase protecting places ought to look ahead to a confirmed break under the 20 EMA with growing quantity.
A day by day shut under $678 can be the set off for defensive positioning.
Close to-Time period Consolidation
The almost certainly situation within the speedy time period could also be continued consolidation between $680 and $690 because the market digests current beneficial properties and awaits year-end catalysts.
This might enable the MACD to probably base and generate a bullish crossover with out the worth needing to make new highs instantly.
Merchants might search for range-bound methods or anticipate a transparent break of both boundary earlier than committing to directional trades.
Longer-Time period Concerns
So long as SPY stays above the 50 EMA at $674, the intermediate-term uptrend construction stays viable.
The 200 EMA at $636 represents the final word line of protection for the long-term bull market.
The November selloff examined the resolve of bulls however finally discovered patrons keen to step in on the $640 stage.
Whether or not these patrons have sufficient conviction to drive SPY to new highs or whether or not they’ll be overwhelmed by distribution at present ranges might be answered within the coming classes.
Watch how the worth reacts on the present $680-$690 consolidation vary. That may probably decide the trajectory for early 2026.
