$SPY (SPX-500 ETF) trending higher

Updated: Sep 13, 2019

SPY, SPDR Exchange Traded Fund, follows US Stock Index S&P 500. Its a closed ended fund. All major US Indices have been recording all time highs in 2017, name it Dow Jones Industrial Average (above milestone 20K) or S&P 500 (not to forget Nasdaq Composite).

Given better returns in Stocks, its no surprise that investors are pumping in their money into riskier Equities instead of usual safe options, and are getting thereby rewarded. (High risk high returns!) And so is the performance of SPY, as indicated by the daily chart. In-spite of low volumes and touching higher band of Bollinger Band limits that indicate oversold territory, this passive instrument exhibits enormous strength.

Let's take closer look here in 5-min chart. Markets opened bullish post a US trading holiday on Monday. Chart shows almost 50 bps gap, as a result, that was expected to close during the day (any sudden rise is followed by a fall and vice versa). However, $SPY kept rising throughout the day, with feeble volumes. And so did the parent Index!

Will the S&P 500 and thereby SPY continue making new records (in-spite of indications of oversold positions) or is there a reversal on the cards? And if so, by when?