• US stocks end July slightly higher, with Dow Jones up 3.1%, S&P 500 rising 3%, and Nasdaq gaining 3.8% for the fifth consecutive positive month.
• Chevron leads the Dow after an upgrade, while J&J lags as it faces talc-related liabilities.
• Dollar index firms near 102 but poised for over 1% monthly decline, fueled by cooling US inflation and expectations of Fed’s rate hikes nearing the end.
• US 10-year Treasury yield hovers close to 4%, supported by strong economic data, maintaining the Fed’s hawkish stance.
• Personal spending exceeds expectations, showcasing the economy’s resilience to higher interest rates.
• Fed implemented a 25bps rate hike, signaling the possibility of another increase in September based on economic data.

The E-mini S&P 500 is currently trading in a balanced price range on the short-term perspective, with traders seemingly leaning towards selling around the upper extreme at the moment.

The lower dollar has been supportive for the market, but the positive volatility during the session may act as a pressure factor as the market encounters absorption around the mentioned upper extreme.

In the previous session’s volume profile, a p-shaped structure is evident, and the bias perception is towards the POC. Market participants might view trading above this particular level as bullish, while an auction below it could accelerate selling.

(Click on image to enlarge)

Nevertheless, the market might aim to reach the swing highs again for absorption purposes, potentially leading to the opening of core short positions for a potential rotational scenario towards the lower extreme.

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