SPY’s 2023 in Channels

A lookback on SPY’s performance in 2023 (hint: lots of ascending & descending channels!)

Contents

Introduction
SPY from 1/1–2/2: Ascending Channel +7%
SPY from 2/2–3/13: Descending Channel -8%
SPY from 3/13–7/31: Ascending Channel +19%
SPY from 7/31–10/27: Descending Channel -10%
SPY from 10/27–YE: Ascending Channel +16%

Introduction

Why SPY?

As I am making my own market lookbacks for 2023, I wanted to start with SPY to help build my perspective on how the market has performed.

What did SPY do in 2023?

What did SPY do in 2023?

Well, it went up 17%.

Yes… but how? When? Why?

This is what I get for not paying too much attention to SPY. It’s a personal problem, I know. I do own ETF’s that track the S&P 500… but I just “sit” on them because I find it too boring (sorry!) to watch on a day-to-day basis. When it goes down, I sit tight. When it goes up, I drool.

More About Channels

Depending on your trading strategy, you may trade channels frequently or you might be wonderfully oblivious to them.

I fall somewhat in the middle… while I prefer candlestick chart patterns and simple support / resistance levels to help me plan my trades and take positions, channels and trading ranges are some common patterns that you’ll see when doing lookbacks for particular stocks.

So when I say ascending (or descending) channels, I am simply referring to the linear patterns (with the occasional corrections) that stocks form when going up (or down), which I emphasize with the lines that I draw on the charts.

With that being said, I have gotten into trouble using channels to estimate future stock movements… my greedy eyes want to take the current trendline and run with it, which gets me into more trouble than it’s worth for me at the moment. At some time in the future I want to do a deeper dive into channels and formulate my own trading strategies, but I’m not quite there yet right now.

SPY from 1/6–2/2: Ascending Channel

SPY rose 7%

SPY’s Ascending Channel from 1/6–2/2/2023

Corrections

There was only one “correction” throughout this period, where SPY dropped 2% from 1/13–1/19.

Corrections (1/13–1/19) in SPY’s Ascending Channel from 1/6–2/2/2023

SPY from 2/2–3/13: Descending Channel

SPY fell 8%

SPY’s Descending Channel from 2/2–3/13/2023

Corrections

SPY’s trend throughout this period “reversed” (for lack of a better word here…) briefly from 3/1–3/6 where it gained 2% before continuing its downwardly descent again.

Corrections (3/1–3/6) in SPY’s Descending Channel from 2/2–3/13/2023

SPY from 3/13–7/31: Ascending Channel

SPY rose 19%

This was definitely SPY’s longest winning streak of the year.

SPY’s Ascending Channel from 3/3–7/31/2023

Corrections

There were a number of corrections throughout this period. The average “correction” really only lasted a few days and maxed out at about 3%.

Corrections (4/19–4/26; 4/28–5/4; 5/8–5/24; 6/15–6/26; 7/3–7/7) in SPY’s Ascending Channel from 3/3–7/31/2023

List of corrections throughout this period:

4/19–4/26: -2%
4/28–5/4: -3%
5/18–5/24: -2%
6/15–6/26: -3%
7/3–7/7: -1%

SPY from 7/31–10/27: Descending Channel

SPY fell 10%

SPY’s Descending Channel from 7/31–10/27/2023

Corrections

SPY’s trend throughout this period “reversed” (for lack of a better word here…) a few times:

Corections (8/17–9/1; 9/7–9/14; 10/3–10/11) in SPY’s Descending Channel from 7/31–10/27/2023

List of corrections throughout this period:

8/17–9/1: +3%
9/7–9/14: +1%
10/3–10/11: +3%

SPY from 10/27–YE: Ascending Channel

SPY rose 16%

After sitting in that descending channel for quite some time, SPY rose quickly towards the end of the year, rising a whopping 16% from 10/27 thru the end of the year.

SPY’s Ascending Channel from 10/27–12/29/2023

Corrections

There really weren’t too many noticeable “corrections” in the channel throughout this period, more like periods of rest where the market was pumping the brakes and just trying to stabilize.

Stay Tuned!

This article is the first in my series about 2023 lookbacks. I am planning to write a few more about SPY (about transition periods between ascending/descending channels in SPY last year, and a quick 2023 earnings lookback) and a few more about other key sectors.

Happy Trading!