The SPY consolidated most of the day until breaking out. To keep things simple, here's a look at price on a 3-min chart. It exemplifies perfectly a high probability setup; a price impulse to the highs of the day, tight flag consolidation right at those highs, followed by further upside impulse. This setup is quickly becoming my bread & butter play across any security or time frame.
Not sure if today's breakout was irrational exuberance or not, but looking at a higher time frame gives me the impression that we're WAY over-extended. On this 60-min chart we have a gravestone doji at the end of the day, while the momentum indicator is correcting off the slow line in a negative way:
Here's another look on my standard 5-min chart of the SPY. Not indicated on the chart is the end-of-day bearish momentum divergence that is similar to that in the higher time frame above:
Not sure if today's breakout was irrational exuberance or not, but looking at a higher time frame gives me the impression that we're WAY over-extended. On this 60-min chart we have a gravestone doji at the end of the day, while the momentum indicator is correcting off the slow line in a negative way:
Here's another look on my standard 5-min chart of the SPY. Not indicated on the chart is the end-of-day bearish momentum divergence that is similar to that in the higher time frame above:
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