Certain price levels are more important than others.

Sometimes, the reason for the importance is obvious. For example, investors like to place orders at round levels like $20. This could create a lot of volume and interest when shares trade at the price.

But most of the time the reason for the importance isn’t clear. This is the case with the $423 level for the SPDR S&P 500 ETF Trust SPY.

This level has been resistance for the SPY since early May. There has been more supply than demand for shares at this level, which is why each time SPY reached it, the move higher ended.

Traders should watch this. If SPY can’t break through soon, a new downtrend may form.

(Click on image to enlarge)