The SPYs consolidated until the Fed meeting, after which the markets showed their displeasure with the Fed's decision. The SPYs jumped at Wednesday's open, but couldn't maintain the momentum and spent the rest of the day selling off. The SPYs consolidated on Thursday and Friday, but ended the week on a high-volume sell-off -- which is never a good development.
Notice the SPYs couldn't keep the upward momentum going on Wednesday or twice on Friday.
The QQQQs analysis mirrors the SPYs. However --
The IWMs reveal what appears to be a big fundamental problem in the markets right now.
First, notice the very clear three day downtrend. On Thursday the IWM formed a rounding bottom -- a clear reversal pattern. But, they tried to rally from this twice and couldn't maintain upward momentum.
What does this tell us? Traders were eager to sell into rallies last week, indicating they are looking to dump positions rather than accumulate new positions.
This week could be very interesting indeed.
