Weekly Stock Market Update & SPY Technical Analysis
The market has seemingly gone nowhere in the past few weeks as investors await further details about trade negotiations and updates from the Iran-Israel battle. Trade talks seem to have stalled, but the Trump administration is repeatedly assuring markets that things are moving along and July 9th remains an important deadline for many deals. The market is not necessarily even looking for the details of a trade deal, Wall Street is rather concerned with the uncertainty that the ongoing negotiations is bringing.
Many stocks are beginning to show very "tight" price action—meaning their trading ranges are getting smaller—which often signals that a big move is on the horizon. Last Friday was a “triple witching” day, when stock options, stock index futures, and stock index options all expire simultaneously. These days often mark the end of a trend and can serve as a turning point for the market, setting the stage for a significant move in either direction. We’ve positioned ourselves for this potential shift through the weekly stock picks we share every Sunday. Even if markets pull back early this week due to the United States’ decision to strike Iran, there are still many stocks trading at attractive valuations—offering great opportunities ahead of the next rally. Our weekly picks are focused on names with the highest likelihood of upside when the market finds relief. So, when that next positive catalyst or resolution of uncertainty arrives, we’ll be ready to capitalize on the move.
Apart from the awaited updates about trade negotiations and the Middle Eastern conflict, the market is anticipating several key events this week. Here’s what’s in focus:
- Fed Chair Powell testifies to House Financial Service Committee (Tue)
- Q1 GDP Second Revision (Wed)
- Consumer sentiment (Fri)
-
PCE Inflation Index (Fri)
Fed Chair Powell spoke last week following the Federal Reserve’s decision to leave interest rates unchanged, highlighting the importance of further data to assess how the U.S. economy is reacting to tariffs. Powell mentioned that higher tariffs will lead to inflation, which has stopped The Feds from cutting rates further and easing their policy. This week’s reports will be a “cocktail” of economic health, giving us an insight into whether or not consumer sentiment is improving from historically low levels, and whether or not inflation has seen an uptick due to recent tariffs. Moreover, the final reading Q1 GDP will be essential because the previous reading showed that the U.S. economy contracted in the first quarter, if this reading reverses that data and shows expansion, it may boost investors’s confidence and challenge recession fears.
SPY Technical Analysis:
Although SPY ended lower last week, it didn’t break below any key supports to indicate that the market is ready for a full blown sell-off; however there's a high likelihood that markets will move lower early this week due to the U.S. strike on Iran. Although this may have a short-term impact, the escalating war doesn't necessarily mean a market "crash" is going to take place. We've seen markets shrug off most political tensions and rally on ahead, but we are preparing ourselves for short-term volatility. Want to see real-time market updates and daily new set-ups? Learn about our Hyper Stocks Pro membership.