SPY Distribution Confirmed Below $680 Support
$SPDR S&P 500 ETF Trust(SPY)$ distribution on break $680 and $676 rejection is confirmed.
Distribution happens after a strong move up when smart money begin selling to late buyers.
Price stops trending up past $697 moves sideways near the highs, forming a range between resistance $697 and support $677. Many traders believe the market is simply consolidating before another breakout, but institutions are actually selling into the buying pressure.
3 key signs of distribution:
#1. Failed breakouts. Price may briefly push above resistance but quickly falls back into the range. This means buyers tried to push higher, but sellers absorbed the demand.
#2. Momentum weakens. Even within the range, price struggles to make strong new highs and starts forming weaker pushes.
#3. Volume tells the real story. During distribution, moves up often happen on lower volume, while drops happen on higher volume. This shows sellers are becoming more aggressive.
The real confirmation happens when support breaks with strong volume. This means buyers can no longer defend the level.
Once support breaks, the market typically enters the markdown phase, where price falls quickly as sellers take control.
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