8/14 Cautiously Bullish. 680 Buying | 150 Selling.
% Stocks Over 50SMA is Bullish. Primary Indicator is Bullish. 20% Weekly is Bullish – Extreme Caution.
The market extended its record highs fueled by growing expectations for a September rate cut, supported by strong breadth and momentum despite some profit taking in mega-cap tech names. Small- and mid-caps outperformed, signaling rotation into more cyclical and overlooked sectors amid easing monetary policy optimism.
Materials (+1.7%), Health Care (+1.6%), Consumer Discretionary (+1.3%), and Energy (+1.2%) led sector gains, while Communication Services and Technology lagged modestly. VXX showed a mild uptick in volatility, warranting vigilance for sudden swings.
Key economic data on Thursday includes July PPI and weekly initial jobless claims, which could influence near-term rate cut expectations and market direction.
Key Takeaway:
Traders should focus on cyclical sectors and small/mid-cap strength while maintaining caution due to stretched valuations and rising volatility signals. Use support levels near 50SMA as risk control and watch for volume confirmation on breakouts. Avoid chasing mega-cap tech amid profit taking and instead look for continuation setups in leadership sectors with relative volume support.
Watchlist
Continuation: AMZN (S1: 224, S2: 224, S3: 224.5, R1: 224.5, R2: 225, R3: 225)
Anticipation: SOUN (S1: 15.5, S2: 15.5, S3: 15, R1: 16.5, R2: 16.5, R3: 17)