Daily Commentary: July 08, 2024

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Earnings Season Starts This Week

Posted by Pete Stolcers on July 08
www.oneoption.com

The market is floating higher on light volume. Use caution.

PRE-OPEN MARKET COMMENTS MONDAY – The big economic news this week is CPI and PPI Thursday and Friday. Inflation has been gradually declining and that trend should continue. Earnings season starts this week, but it won’t pick up for a couple of weeks.

The last leg of this rally has been program driven and the volume is light. The path of least resistance is up. I like day trading from the long side once support has been confirmed. Stick with mega cap tech stocks and keep it light. Do not chase any gaps up. Those could easily turn into gap reversals.

On a swing basis you should keep your risk low. The rally is very concentrated and a handful of mega cap tech stocks are fueling the move up. The higher we go from here, the greater the chances for a market dip. The closer we get to August, the greater the chances for a market dip. I am setting alerts on stocks with relative weakness and I am waiting for the warning signs to start surfacing. I need technical confirmation. Watch for the “canary in the coalmine” that I highlight in this video.

Support is at the low from Friday and resistance is the all-time high. By the way, the SPY is approaching a major H+ trendline right here and it could provide resistance. A breakout above it gets us into buying climax territory.

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