Weekly Market Analysis 7/7/2024
A new all time high on a holiday shortened week and I am not surprised. Looking at last weeks price action it was fairly clean and predictable. I only traded Monday and Tuesday with the July 4th holiday creating some potential liquidity issues and, honestly, I just knew that they would be sub par days for my focus with work and the holiday hours. The price action respected our levels along the way and with no sellers to be found, liquidity was grabbed by the bulls and made its run through the all time highs and beyond.
I like the levels that were created to act as support on the way down when that time comes. The setups here were clean and all pullbacks were bid up creating nice breakouts of structure. I would be interested to see if we pull back to that previous all time high level (white dashed line) one more time before more buying continues. Now lets take a look at the week to come.
Important Data for the week:
This week includes a testimony by JPOW on Tuesday and Wednesday. Last time he spoke in Washington markets were fairly muted until he was finished and then continued their move. I think that probably will be similar price action that we will see here. Since we are in the all time high levels it will allow price to take a pause, gather more information and then, without being shocked make the move it wants. We do have inflation on Thursday so that fact as well may make the early part of the week indecisive, build up orders for the moves thereafter. Friday data early will likely continue to add move volatility with PPI and consumer sentiment. If that CPI number continues to creep down and the Consumer Sentiment does not take a big hit, or is better than expected, this market sees more of the same with the bulls in full control.
News Headlines:
With Hurricane Beryl about to make landfall here in Texas, heavy rains, strong winds and flooding along with other issues could cause economic impact in the region, including affecting my trading/streaming.
Our fear greed index is slowly creeping back towards the greed zone. I would anticipate that by the middle/end of the week we will be reaching near extreme greed. If that is the case then anytime we see that greed get up there then we are about ready for a correction.
Unfortunately with the Hurricane here and the weather rapidly deteriorating I have to cut this writeup short, for now. If I can add more to it I will tomorrow morning. Below is my outlook for the coming week with my levels.
As you can see here, we have spent but 1 trading session ever at these levels. All time highs are at 20,639.50 and the previous ATH level at the bottom of the chart is 20,371. These would be you major decision points to watch and see what happens to start the week. Price could remain in this range until CPI Thursday, however, I have a hard time believing that this rally has reached its peak yet. We may find some buyers below at 20,540 in the short term and of course at Fridays low at 20,369.75. Upside breakout targets are pure guesswork and I usually like to use a fib extension and measured moves to give me the best probability areas of interest. That type of analysis puts us at around 20,784-20,800 as the current area that would make some calculated sense.
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