6/17 Cautiously Bullish. 450 Buying | 125 Selling.
% Stocks Over 50SMA is Bearish – Overbought. Primary Indicator is Bullish. 20% Weekly is Bullish – Caution.
The market bounced back from Friday’s selloff as easing geopolitical tensions around Israel-Iran lifted mega-cap tech and discretionary sectors, though gains faded into the close. Semiconductor stocks surged on strong momentum and volume, while defensive sectors like energy and utilities lagged amid lower crude prices. Volatility remains subdued, supporting a cautiously optimistic environment.
Tech and communication services led with solid volume and price strength, while energy and defense stocks retreated as conflict fears eased. VXX showed declining volatility, reinforcing a constructive backdrop for growth sectors.
Retail sales and industrial production data are due Tuesday morning, with potential to influence short-term market direction.
Key Takeaway:
Focus on tech and semiconductor stocks showing strong volume and momentum, especially those near support levels for potential continuation plays. Avoid defensive sectors that are underperforming and remain cautious given the overbought condition on the 50SMA breadth indicator. Use tight stops below key supports to manage risk in this environment of fading early-session strength.
Watchlist
Continuation: KLAC (S1: 880, S2: 885, S3: 890, R1: 895, R2: 900, R3: 910)
Anticipation: CW (S1: 470, S2: 465, S3: 460, R1: 478, R2: 482, R3: 486)
