Wednesday was a good day for the bulls, but let's not pretend it was an exciting trading session.
The Invesco QQQ Trust (QQQ) spent most of the session above its session volume-weighted average price (VWAP), but that strength didn't amount to a hill of beans for day timeframe buyers. The SPDR S&P 500 ETF (SPY) was even more disappointing, but again, only from the viewpoint of a day timeframe scalper. The SPY held its opening gap through the regular session, but aside from the quiet late-day rally scalpers batted the ETF back and forth within an incredibly tight range.
If I'm going to complain about one of the index ETFs, it will be the iShares Russell 2000 ETF (IWM) . While the IWM closed above its 5-day and 10-day exponential moving averages (EMA) for the first time since March 3, the ETF failed to extend beyond the session's first 30 minutes of trading. Enough buying came in to keep the IWM from fully crashing the opening gap. However, with the declining 21-day EMA a couple points above Wednesday's closing print and the 14-period Relative Strength Index (RSI) still holding beneath 50, short-term traders must be careful with this ETF.
If you trade the IWM, consider downsizing your position and giving it some wiggle room on the downside. Though the bulls aren't yet in control of small-caps, and with the caveat that another hiccup in regional banking land will sink the IWM once again, if I'm trading this ETF long I'm either using a tight (closing) stop near $173.50 or a slightly more liberal (closing) stop under $171.50. My preference is the $173.50 tight closing stop because that would place the IWM back under its 5-day and 10-day EMA, and frankly, I never like to own short-term positions that fall beneath those EMAs.
Turning to the iShares 20+ Year Treasury Bond ETF (TLT) , buyers were active beneath Tuesday's $104.02 intraday low on Wednesday, which is good. Unfortunately, the buying was weak and the ETF closed under both anchored VWAPs I highlighted on Wednesday. A close above $105 today or Friday likely places the TLT back in play among active traders, but barring such a move I'd leave this ETF alone.
