S&P 500, Nasdaq 100 Trackers SPY And QQQ Below 200-Day Average As Tariff Concerns Continue To Trouble Markets

The exchange-traded funds tracking the S&P 500 index fell again, whereas the one tracking the Nasdaq 100 continues to remain below its 200-day average as President Donald Trump‘s tariff announcements continue to make headlines.

What Happened: The technical analysis of SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust, Series 1 QQQ shows that both were trading below their long-term average amid ongoing market volatility.

SPY

According to Benzinga Pro, SPY’s price was below its 20, 50, and 200-day simple moving averages, as of Wednesday’s close.

Concerning its long-term 200-day average, SPY was under pressure for 10 trading days after slipping below this level on March 10. However, it recovered on Monday this week and traded above that level on Tuesday, following a drop again on Wednesday.

While its relative strength index was neutral at 44.86, the MACD line was negative at -6.37, but it was getting closer to the signal line with a positive histogram metric of 1.78, showcasing a bullish sign within a bearish trend.

QQQ

QQQ’s price was also lower than its 20, 50, and 200-day simple moving averages, as of Wednesday’s close.

However, it has been below its long-term average since March 5. While it got closer to the 200-day average on March 25, it fell further on Wednesday. This marks 16 sessions of the fund price being below its long-term average.

Its RSI at 44.28 was neutral, whereas, similar to SPY, the MACD indicator was negative at -7.58 with a positive histogram value of 2.13, indicating a bullish sign within a bearish trend.

Why It Matters: After saying that some countries may be exempt from the incoming “reciprocal tariffs” on April 2nd, Trump introduced a 25% tariff on auto imports on Wednesday. Trump said, “This will continue to spur growth.”

While tariffs carry expected economic costs, their negative effects can be significantly mitigated through company and consumer actions, according to Scott Wren, senior global market strategist at Wells Fargo.

“Let's be clear: We expect tariffs to have some economic cost,” Wren stated, noting some U.S. companies have already raised prices due to tariff impacts, though often less than the full tariff rate. He observed that high corporate profit margins provide “some room to absorb a portion of the price increases.”

Mitigation efforts are already underway. “Keep in mind that some companies have been diversifying supply chains since the early days of the pandemic or even prior to that,” Wren explained.

Consumers also adapt. “Consumers can also blunt some of the effect of potential tariffs… for many products, there are substitution possibilities,” Wren added, citing examples like choosing domestic alternatives if imports become too costly. He believes “these reactions will blunt and dilute much of the negative tariff impact.”

Price Action: The SPY declined 1.19% to $568.59, and the QQQ dropped 1.84% to $484.38, according to Benzinga Pro data on Wednesday.

On Thursday, the futures of Dow Jones rose by 0.27%, whereas the S&P 500 and Nasdaq 100 advanced by 0.21% and 0.06%, respectively.

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