Good morning,
I don’t have any grand takeaways going into this week, but a few things about last week have my attention.
The first is that despite inflation data coming in far softer than expected, the market ex-technology failed to rally. That includes financials, which were the primary earnings reporters last week.
The reaction wasn’t bearish, to be sure. But, increasingly, I hear so many people talking about how strong S&P 500 earnings are coming in, so it’s not necessarily surprising to me that the market would have priced that in before the actual reports.
The second big story is the complete breakdown in the memory trade, something we’ve been tracking since mid-May. We saw some signs of downside exhaustion and a bullish reversal on Friday, and I want to be clear that I’m open to (though not betting on) a bounce of any magnitude for this group.
But, I do not believe the lows are in here, as sellers just took control of the tape and investors are still pouring money into the DRAM ETF, as opposed to the sentiment flush we would expect to see at a major bottom.
This week’s report will review:
The key support level to watch for technology stocks
Major index technicals
Breadth
Risk-taking ratios
Semiconductors
Oil and energy
and more!
