Double Top Reversal or Breakout?

The SPY technical picture changed materially overnight after futures exploded higher by roughly 65 handles following renewed “closer to an Iran deal” headlines. The potential double-top structure near 749–750 has weakened significantly because price is no longer merely retesting prior highs, it is now trading through them and printing fresh all-time highs in futures. Join us to get our SPY options trading signals (trades) in real time

That does not automatically invalidate the possibility of a future failed breakout or “bull trap,” but it does mean bears no longer have confirmation of exhaustion at resistance. Instead, the market is now entering a momentum-extension phase where positive gamma positioning above the 738 gamma flip continues to suppress volatility and force short sellers into repeated squeezes. As long as SPY remains above the prior breakout zone near 749–750, the path of least resistance remains higher toward the weekly R1 area around 754.45, with the next major extension zone near the 30-minute pivot around 767.88

The bearish counterargument is that this latest leg higher may be built on increasingly fragile momentum. Price is pushing into fresh highs, but RSI has not confirmed with the same strength, creating a bearish divergence that suggests the rally is being driven more by headline-chasing and short-covering than by clean institutional accumulation. The repeated “we’re close to a deal” narrative is also starting to feel stale, and if Tuesday opens with a euphoric gap higher, disciplined traders may use that strength to take profits rather than chase. That creates the classic gap-and-crap risk: SPY gaps above prior highs, briefly traps late bulls, then fades back under the breakout zone. Confirmation would not come from the gap itself, but from a failure back below 749–750, followed by a loss of 743.80. A daily close below 730.74 would turn the setup from a failed breakout into a much more serious double-top confirmation. if the SPY spread holds. That means 745.64 is now support, not a trigger, and the first real test Tuesday is whether bulls can hold above the prior high zone around 749–750.

We're bullish above 749–750, targeting 754.45 first. If that breaks and holds, then the extended target becomes 757.88, followed by the 763–768. But if SPY gaps up and immediately rejects back under 748.92, that becomes a failed breakout setup, and I’d watch for a retest of 746.05, then 743.80. Below 743.80, the gap-up thesis is likely dead and the downside opens back toward 741.54–738.07. The SPY technical picture changed materially overnight after futures exploded higher by roughly 65 handles following renewed “closer to an Iran deal” headlines.

The potential double-top structure near 749–750 has weakened significantly because price is no longer merely retesting prior highs, it is now trading through them and printing fresh all-time highs in futures. That does not automatically invalidate the possibility of a future failed breakout or “bull trap,” but it does mean bears no longer have confirmation of exhaustion at resistance. Instead, the market is now entering a momentum-extension phase where positive gamma positioning above the 738 gamma flip continues to suppress volatility and force short sellers into repeated squeezes.

As long as SPY remains above the prior breakout zone near 749–750, the path of least resistance remains higher toward the weekly R1 area around 754.45, with the next major extension zone near the 30-minute pivot around 767.88.