The SPDR S&P 500 (NYSE:SPY) closed slightly higher on Monday on far below-average volume ahead of the Fourth of July holiday.

The stock market ETF printed an inside bar pattern on the daily chart, which leans bullish for continuation, although a bearish quadruple top pattern could cause resistance near the $444 level to hold strong.

More experienced traders who wish to play the SPY either bullishly or bearishly may choose to do so through one of two Direxion ETFs. Bullish traders can enter a short-term position in Direxion Daily S&P 500 Bull 3X Shares (NYSE: SPXL) and bearish traders can trade the inverse ETF, Direxion Daily S&P 500 Bear 3X Shares (NYSE:SPXS).

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The ETF: SPXL and SPXS are triple leveraged funds that track the movement of the SPY, seeking a return of 300% or negative 300% on the return of the benchmark index over a single day.

It should be noted that leveraged ETFs are meant to be used as a trading vehicle as opposed to long-term investments.

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The SPY Chart: The SPY’s inside bar pattern leans bullish because the ETF was trading higher before forming it and because Monday’s trading range took place near the top of Friday’s range. Bullish traders want to see the ETF break up from the mother bar on higher-than-average volume on Wednesday, which will confirm the pattern was recognized.

Bearish traders want to see big bearish volume come in near $444 again on Wednesday, which could suggest the quadruple top pattern is dominant or it could cause a quintuple top pattern to print. If that area continues to act as strong resistance, sideways consolidation or a retracement lower are likely.

The sideways consolidation that the SPY has been trading in over longer time frames has allowed the ETF’s relative strength index to drop from overbought territory to a more comfortable 68%. If the SPY breaks bullishly from the inside bar pattern, the RSI will head above 70% again, which could indicate a pull back is in the cards for later in the week.

The SPY has resistance above at $443.90 and $447.06 and support below at $436.79 and $429.80.

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