TRADE SETUP SPY

Where do we stand fundamentally?

A notable development involves Berkshire Hathaway, led by Warren Buffett, liquidating its holdings in SPY and the Vanguard S&P 500 ETF (VOO) during Q4 2024, each previously valued at around $22 million. This move, reported on February 27, 2025, left Berkshire without any ETF positions, though Buffett dismissed speculation of market overvaluation in his annual letter, maintaining a long-term bullish stance on U.S. stocks.

Additionally, SPY has been part of broader market analyses. It's noted for being on the verge of breaking below its 100-day moving average, reflecting investor caution amid uncertainties like tariffs and mixed economic signals. Despite this, SPY saw significant inflows last week, with $12 billion into U.S. equity ETFs, making it one of the most-loved ETFs alongside QQQ and VOO. Meanwhile, VOO recently overtook SPY as the world's largest ETF in terms of assets under management, a shift highlighted in posts on X earlier in February.

SPY is reversing strongly from a 610 level and has reached strong long-term support 580. If this level fails we could see a strong downside breakout and a test of 560. Since previously we had a strong bounce from the 580 I expect a bounce as well short-term.

We are in a possible third long-term wave finish here and a fifth short-term wave although we could have one more swing upside to 650 before a hard downside reversal. A breakout below 580 and 560 will invalidate the short-term swing higher.

_{I am taking a near-term long-trade entry with an SL below 575 to target 605 and possibly higher. You can trade it with options as well by buying call options.}