SPY’s Bearish Setup Faces CPI, PPI and a 725 Put Wall

By Nathan Brooks

BullBearInsights’ Nov. 9–13 analysis put SPY’s close at 735.29, below bearish thresholds at 750 and 758.58. The instrument is the State Street SPDR S&P 500 ETF, ticker AMEX:SPY, and it traded near 740.05 overnight. Its daily RSI sat near 32, conditions the analyst described as oversold and open to a relief bounce.

BullBearInsights said: “A short-term bounce is possible because SPY is oversold and hourly momentum is improving.” The analyst still described the larger trend as bearish below 745–750.

The catalyst calendar

BullBearInsights identified three releases that could alter the week’s rate expectations and market direction:

• CPI: Tuesday at 8:30 a.m. ET
• Jobless claims: Thursday
• PPI: Friday at 8:30 a.m. ET

Inflation data could quickly change rate expectations and market direction, BullBearInsights said. CPI comes first, followed by Thursday’s jobless claims and Friday’s PPI. Both CPI and PPI arrive at 8:30 a.m. ET; the note gives no release time for jobless claims.

Daily chart: oversold, not reversed

The daily trend remained bearish below 750 and 758.58 in BullBearInsights’ reading. RSI near 32 indicated oversold conditions, so a relief bounce was possible. Main support sat at 730.30–727.61, below the 735.29 close, and 735 also marked a key option level on Monday’s map.

The 730.30–727.61 band sat below both the close and overnight price, while 750 and 758.58 remained overhead thresholds. BullBearInsights did not treat oversold conditions as proof of a reversal; they only created room for a relief bounce against the prevailing trend.

Hourly momentum improves

Momentum was improving from the 727.41 low on the 1-hour chart, and price broke the immediate downtrend line. BullBearInsights said bulls still needed to reclaim 742.20 and 745 to confirm a stronger reversal. Breaking the line marked better short-term momentum, but both levels remained above the overnight price near 740.05.

Options positioning can magnify a break

Monday’s GEX map showed negative GEX, IVR at 76.4 and heavy put positioning. BullBearInsights said negative gamma can amplify moves after a level breaks. The analyst highlighted several option levels:

• 745 overhead
• 735, followed by 730
• 725, the major put wall below

BullBearInsights tied that map to the trading plan: a break through 745 could strengthen the call case, while a break below 735 could trigger the put case. Negative GEX could make either move more forceful after confirmation.

BullBearInsights’ trading plan

The call setup requires holding above 742.20 and reclaiming 745. The targets are:

• 750
• 755
• 758.50

The put setup calls for rejection from 742–745 or a confirmed loss of 735. The targets are:

• 730
• 727.50
• 725

A break below 725 could open 720. The no-trade area runs from 738 to 742.20, where BullBearInsights advised waiting for confirmation rather than chasing inside the range. The overnight price near 740.05 sat inside that band.

The setups were conditional rather than automatic. The call trigger required both a hold above 742.20 and a reclaim of 745; the put trigger required either rejection or a confirmed break. Each route targeted a separate sequence rather than sharing one directional forecast.

What does this change for SPY traders?

The practical distinction is between a possible bounce and a confirmed reversal. Holding above 742.20 and reclaiming 745 would meet BullBearInsights’ requirements for the call setup. Without those moves, the note does not confirm a bullish reversal.

The bounce case rests on two readings: RSI near 32 and improving hourly momentum from the 727.41 low. Neither reading alone proves the larger downtrend has ended. BullBearInsights’ broader call remained bearish below 745–750.

Options positioning makes any confirmed break more consequential. With negative GEX and heavy put positioning, BullBearInsights said negative gamma can amplify moves once a level gives way. The note’s 725 put wall therefore matters because a break below 725 could open 720.

The analyst also put the event risk in practical terms: “CPI is the major risk event, so trade the reaction rather than predicting the number.” Going into Tuesday’s 8:30 a.m. ET CPI release, the setup is defined: reclaim 745 for the call targets, reject 742–745 or confirm a break below 735 for the put targets, and stand aside inside 738–742.20.