Where Is Possible Support for SPY?

Take a look at some possible support areas for the SPDR S&P 500.

The SPDR S&P 500 (NYSEARCA:SPY) is down nearly 5% from its September peak. The sell-off yesterday almost filled in the gap from September 6, which happened to be the day the European Central Bank (ECB) announced its major bond-buying program — which was, hence, a big up day for our markets. The following week, our own Fed announced QE3, which also spiked the markets up further. The charts below illustrate my possible support areas for the SPDR S&P 500 ETF (SPY) :

Rising 80-day moving average (purple line) could offer support, as it has in the past.
March-May highs coincide around the $140 level.
The current sell-off has retraced almost 38.2% of the recent summer (to early fall) move higher.
Enormous peak put open interest for the November series resides at the 140 strike.

Click to enlarge

This article by Tony Venosa, CMT was originally published on Schaeffer's Investment Research.

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