Over the week of 2-7-22 to 2-11-22, the ETFs reached the levels intra-day several times. The Gap Up on Wednesday resulted in a tight range for each of the ETFs. On Thursday however, in a Fast Move, the markets attempted to close the gap. The move failed and later the ETFs became intra-day reversals. All three ETFs reached the ML2 level by 11:30 AM.
SPY
The past week saw a few days where the IDMM Levels were reached in each of the market-based ETFs. The SPY met the MS1 in a late day ‘Fast Move’ and closed above that level. Tuesday, the SPY reached the downside limit before reaching the ML1. The ML1 (449.61) was reached in the early afternoon and the SPY closed above that level. Gap Openings, such as the one on Thursday tend to move back towards the previous day’s trading range. The SPY reached a ML2 (456.06) level by 11 AM. Later Thursday, the SPY became an intra-day reversal. Back-to-back intra-day reversals are not common, but they do occur. Friday, the SPY reached the MS1 Level, after having reached the Upside Limit. It continued lower to the MS2 Level and closed below that level.
QQQ
On Monday, the QQQ made a Fast Move to the MS1 Level in the last 30 minutes of trading. It closed above that level. Tuesday, the QQQ reached the ML1 level and closed above that level. Wednesday and Thursday were gap openings. Wednesday resulted in a ‘Tight Range.’ Thursday, the QQQ opened down and tested Wednesday’s trading range in a Fast Move to the ML2 level (365.20). Later the QQQ became an intra-day reversal. Friday, the QQQ reached the MS1, MS2, and MS 3 Levels and closed below the MS2.
DIA
The DIA consolidated on Monday, as it did not reach either level, the ML1 or MS1. The downside limit was met in early trading on Tuesday. The DIA later reached the ML1 level and closed above the ML1. The DIA gapped up on Wednesday and traded in a tight range. Thursday, the DIA opened down and tested Wednesday’s trading range in a rather fast move to the ML2 level (357.66). Just after noon Thursday, the DIA became an intra-day reversal. On Friday, the DIA reached the MS1 Level, after having met the Upside Limit in earlier trading. The DIA traded down to just below the MS2 level and closed below the MS1 level.
A few things to remember from this week about market tendencies. Gaps have a tendency to move back towards the previous day’s trading range. While they do occur, back-to-back intra-day reversals are not likely.