Weekend Report for Monday, July 01

Bottom Line:

The dramatic reversal days in the SPX and NDX were not confirmed by the other primary US stock indices, so we won’t know of their implication until next week. Reversals like we saw in the NDX and SPX typically portend a top is in place and immediate further decline. However, “normal” hasn’t been a hallmark of the overall US stock market landscape in the past year.

Also, Friday was the last day of the quarter and one-half year mark. How much of the price machinations were related to that is a fair question.

Aside from the SPX and NDX, price action among the other indices continues to be choppy and non-directional trade. The New York Composite for instance, closed almost to the tick at the same level it closed on March 13.

The big question remains: How will the continued disparity among the US indices be resolved? Is the US stock market forming a major top, with the SPX and NDX simply the last two indices to get the message, or are the other indices about to begin to show relative strength and begin to catch up with the SPX and NDX? 

I will continue to remind: ALL bear markets, bull markets and significant tops and bottoms will have the indices pulling in the same general direction. Price action is inconsistent and “out of synch” and has been so rather dramatically since mid-May.

This is very likely to change, soon.

PDF: Weekend Report_2024_07_01

VIDEO: https://youtu.be/YYl6vJ07Zb8 

SPX

The SPX is 12.50 points away from its close of eight days ago.

Upper KRA: 5524
Lower KRAs: 5446; 5402; 5375

NDX

Upper KRA: 20021
Lower KRAs: 19472;19345;19212

DOW

Upper KRA: 39571; 40080
Lower KRAs: 38889; 38305

RUT

Upper KRA: 2136
Lower KRAs: 1993; 1931

New York Composite

This is an index of every stock listed on the NYSE, so it is a broad composite view. 

Upper KRA: 18189; 18432
Lower KRAs: 17909; 17713

SPX Profile

We’ve been following the SPX profile daily in the Membership updates. This view reflects that the SPX needs to close above 5470 to restore a bullish scenario.

RUT Profile

The Russell 2000 began to show relative strength last week. It formed a Balance Area last week and then broke to the upside. It closed higher both Thursday and Friday.

The 2022-2014 HVN is critical to a bullish thesis, both in the RUT and the overall US stock market.

Internals

No change: Internals continue to reflect a lack of broader breadth. There is no big take-away other than that from this perspective.

US 10-yr. Notes

Whippy and generally non-directional trade.

US Dollar

Between significant levels.

Gold

Getting “overdue” for a test of either upper or lower critical levels.

Crude

Short-term trend is up. In a minor Balance Area.