With the aftermath of the horror of the weekend, the market responded with presuppositions of a Trump victory.

However, we believe that these presuppositions might be a bit premature.

November is still far away.

January 2025 is even further away.

And the market, although tends to run 6 months in advance, behaved as if it knows that:

1. Trump will lower taxes
2. Trump will drill for oil and gas and ignore alt energy
3. Trump will execute hawkish trade policies like tariffs
4. Trump will support Bitcoin and crypto
5. Trump will put pressure on Powell to lower rates
6. The dollar will be stronger
7. Trump’s Truth Social DJT will earn revenue
8. Cannabis has no chance of a rescheduling

I have 2 reactions to this:

1. Trump, if he wins, has been known to go with the popular consensus so that any of the aforementioned policies can change if a bigger headline that is out of anyone’s control engenders a change
2. The economy still has to contend with a nuanced inflation narrative, geopolitics, and the confidence of the consumer. After all, it is the consumer, and not just the investor, that needs to feel ok.

Thus far, July has followed the bullish seasonality.

The peak tends to happen on July 17^th and August tends to be a negative month.

Yet happily, we have a new 6-month calendar range reset, which I will be discussing on a webinar on Tuesday, July 16^th for wealth365.

Let’s see what Granny Retail XRT has to say.

First off, XRT closed in the red.

Secondly, we now have last Friday’s high 77.66 to use for our calendar range high. That is the level to watch now.

As for the low, 73.11 is the support level to hold.

While the phase is bullish in price, and PAY ATTENTION, this is super important, Real Motion or the momentum indicator, is not above its 50-DMA.

Why is that important?

Well, I suggest you sign up to hear me speak. For now, though I will tell you that at these huge calendar inflection points that could be a really ominous warning.

While we are certainly not panicking as the weekly chart looks solid, we should at least be prepared.

Finally, while XRT sits right on the SPY leadership bar, should XRT begin to outperform, the momentum could shift.

The bigger point goes back to the beginning:

We still have a lot of earnings to go through with very lofty expectations.

Plus-

We have a Fed meeting coming up with a still sticky inflation narrative.

Rate cuts right now might not be well received.

The Yield Curve could be shifting to a dis-inversion-the jury is out on whether that means a recession is coming.

Gold is acting like it’s nervous.

Seasonality is not in the market’s favor.

Geopolitics continues to create uncertainty.

ETF Summary

S&P 500 (SPY) New all time highs and 5600 pivotal

Russell 2000 (IWM) January 2022 IWM ran to 227 before the big collapse-take some profits if long

Dow (DIA) New all time highs

Nasdaq (QQQ) 500 pivotal and still working off that nasty bearish bar on the chart

Regional banks (KRE) New range 50-55

Semiconductors (SMH) 260 -280 range

Transportation (IYT) Quite the recovery-now we watch 67 resistance 65 support

Biotechnology (IBB) I still like this sector-152 though resistance

Retail (XRT) 75.50 support 77.50 resistance

iShares iBoxx Hi Yd Cor Bond ETF (HYG) Back to January highs

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Can Momentum Build In Small Caps?
U.S. Centric Indicators