Positive, but mixed day of trading today. However, some clear leadership on the day as gold moves higher taking the miners along for the ride. Small and mid cap stocks both make a solid move on the day as positive for the growth side of the equation.
The big news is the S&P 500 gains 4.7% for the quarter and the best advance since 2009. Tomorrow is will be back to what have you done for me lately from investors. The second half has been prognosticated as the period for growth in the US economy. Only time will tell and we have to go with the trend nothing more, nothing less.
Technology gets renewed interest in the semiconductors to help drive the sector back to the previous high. If the sector regains strength could be a key to the continuation of the upside as the energy sector stall with crude oil testing lower.
Commodities are back in the picture with gold gaining more than 1% on the day and the miners followed suit. This is a trading sector currently with no clear driver for any of the movement currently in play. Be focused on managing risk in the sector short term.
See Trading Notes for July 1st for further comments to what is moving.
Running the EGG Scans – First the daily winners…
Gold (GLD) made a nice move higher, but the miners were the leaders again. NUGT and GDXJ both pushed higher adding the impressive gains. This could put either in position as the EGG trade as they have consolidated and are in position to make a push to the previous high. SLV started lower, but rallied back to close up on the day.
TNA (small caps) made up for lagging last week the last few days, but still remains challenged by the growth outlook for the economy. Despite the confidence of the Fed the data isn’t supporting those numbers. Still worth watching the trade upside. Move above $81.40 ish level could offer a trade.
UNG – bounced off the lows of selling and halted any short trades in the commodity for now. Watching to see if there is a follow through and trade opportunity from the commodity.
PBW – clean energy still in the picture with a nice upside gain on the day.
SIL – silver miners joined in with the gold miners posting solid gain on the day. The flag pattern is ready to break again to the upside.
DBB – base metals nice gain and break higher.
NASDAQ 100 (QQQ) positive move to end the week and post a new high. Large cap technology stocks led the way and worth watching as we start the new trading week.
The movement is still fragmented and lacks continuity. Still want to be patient here and see how this unfolds tomorrow.
EGG Model Scan Watching…
We discussed DRN as potentially regaining upside momentum heading into today’s trading. That obviously didn’t pan out. Watching, but not likely to gain short term momentum.
China (FXI) was also discussed a s possibility on the upside. It has stalled as well short term, but I still like the upside potential as this all plays out.
RUSL (Russia) made move higher last week, but has stalled for now and is testing the current trend. Downside reversal could develop, but we will watch for now.
There is some rotation, but the indexes are consolidating in place. There have been some solid leaders, but we need confirmation of the upside to continue and patience to let it all evolve. Alternative energy, energy, healthcare, technology and small caps have been leading. Commodities have made a solid run of late with gold and silver moving higher (see above). The ripple effect is the miners moving higher as well. Base metals have been moving again. Bottom line… patience as this all unfolds going forward and the opportunities present themselves.
No Current Egg. Risk/Reward of our scans are not in the parameters we set based on current market conditions.
Look for update as we start the trading day. I want to look at the futures and determine if any of the scan ideas we are watching meet our requirements for entry.