What the heck is SPY? And what is a SPY CHART?

SPY is an ETF (exchange traded fund) that moves in proportion to the S&P500 stock market index. A SPY chart is simply a graph of the price of SPY versus time.

Why don't you just focus on the S&P500 Index instead of SPY?

Because you can't buy the S&P500 index - it's just an index that represents the movement of 500 stocks. And it's not practical to buy equal amounts of the 500 stocks that make up the S&P500 index either (think of the comissions). Finally intraday volume is not readily available for the S&P500 index.

SPY is like a mini S&P500 and SPY is what people buy when they want to "buy" the S&P500.

Why are you interested in the S&P500 and not the DOW or NASDAQ?

The DOW is made up of 30 stocks. NASDAQ is made up of 100 tech stocks. The S&P500 is made up of 500 stocks from all the sectors, so it's a broader representation of how the entire stock market is faring rather than the DOW or the NASDAQ.

Are there mini DOW and mini NASDAQ ETFs available also?

Yes. For DOW it's DIA, referred to as "the DIAmonds." For NASDAQ it's QQQQ, referred to as "the Cubes." SPY is referred to as "the SPYders." You're well on your way to being a fast-talking stock broker.

You know what? Apple is going to the moon. Why don't you just buy Apple instead?

That might be a great strategy! But once, not too long ago, Apple was in terrible shape and had to be bailed out by arch-rival Microsoft. I don't think that will happen again, but nothing is certain. Citibank was once the brightest star in the sky but now it's having trouble just trying to lift off the ground. My point is: I don't know the minute details of what goes on in XYZ company. One day XYZ might be flying high and the next day some news breaks that XYZ is over leveraged and XYZ drops 50%. XYZ might be a component of the S&P500 and SPY might drop a bit too, but it won't drop 50%. Granted, if XYZ comes out with a product capable of teleporting you from here to Hawaii by the push of a button XYZ will gain 1000% (and all the airlines will drop to 0) and SPY might only be up 1%.

So there's less risk and less reward. And since the stock market returns on average 10% a year it's not likely to be a bad investment. In the same time Citibank went from 50 to 1 and now to 3, SPY has gone from 140 to 66 to 110. The index has dropped and recovered, Citibank has not.

If you trade stocks for a while, you'll learn soon enough that it's all about minimizing loss. You'll eventually be right with your predictions, but when you're wrong, you have to minimize that loss. Trading SPY is less risky than trading stocks, so it's easier to keep your losses small.

Wait a minute. You said trading SPY is less risky than trading stocks, but I see stock charts all over this website! What gives?

Well I don't trade SPY 100% of the time! I do trade individual stocks, but the day to day movements of individual stocks is harder to predict. Occasionally stocks exhibit certain chart patterns which make an up or down move highly probable. Those are the stocks I focus on, and if I see them then I try to point them out.

Where can I learn more about chart patterns?

Chart patterns are older than dirt. There are a ton of books, websites, seminars on technical analysis and chart patterns. See my "chart patterns" section (in development) for more information.

I just checked out this "SPY" ETF and it's trading at over 100 bucks! I can barely afford 100 shares! And you say this goes up 10% per year? How am I suppose to make any money off this thing in the short term?

By trading SPY options.

Trading Options? That's risky! Aren't you suppose to be minimizing risk?

You're right. Options are risky and trading options is not for everyone. Options provide leverage, but that comes with increased risk. But trading SPY options IS less risky than trading options on XYZ. On a bad day SPY will drop 3-5%, and your option might drop 50-80% in value and there are chances in the coming days that it will rebound. But on a bad day for XYZ when it drops 50%, your option will drop 99% in value overnight and what are the chances XYZ rebounds from a 50% drop in the near future? I'm not saying it's never happened before, but it's not very likely.

Where can I learn more about trading options?

Refer to my Trading Options section (in development) for more information on trading and managing option trades.

I'm not interested in options or short-term trading, what can spychart.net do for me?

I do provide longer term projections on a less frequent basis, but in general this website is not for you. You're an investor, not a trader. You should be concerned about fundamentals like P/E ratios, debt, and the news with less emphasis on technical analysis.

I stumbled over 50 stock websites before hitting yours, what makes yours any different than the others?

True. There are a plethora of stock websites out there addressing the indexes, stocks, options, etfs, technical analysis, etc. But in reading these websites I have trouble walking away with a conclusion on exactly what they expect to happen TODAY. Some provide great long term projections and while it's nice to know, it might not be immediately applicable to me today.

My goals with this website are to:

• Provide daily guidance on where I think SPY is headed today based primarily on technical analysis, volume, and money flow in a clear, concise manner. My performance can be evaluated from my trading history.
• To organize my own charts and thoughts for review in the future. When I look back at charts from weeks, months, years ago sometimes I want to know what the intraday price action looked like. This data isn't readily available, so my collection of charts will serve as library of intraday price action.
• Finally I have a "chart request" box that you can fill out with your favorite ticker and I'll provide a chart with my technical analysis on it. This may help you and it may also help me. Trading is not my full time job and there are too many stocks for me to keep track of on a daily basis. So by fulfilling chart requests, it helps me stay updated on the promising stocks out there, hopefully from a variety of sources.