Well, that wasn't exactly the greatest of starts to a new (albeit shortened) trading week. Greece got the blame again, but as I've been saying for a while, I suspect Greek debt woes are just an excuse for nervous investors to head to the sidelines for a while. Even so, while today's pullback was steep, it's not yet a trend-breaker.
I'll show you what I mean below. We've got a couple of other housekeeping items to cross off our checklist first today.
Happy hump-day, friends and fellow traders. Before I even have a chance to forget to do so, let me remind you right now to be on the looking for Thursday's newsletter right at the open rather than after the close.
I think we mentioned to you in Tuesday's newsletter we were probably going to introduce you to a new Featured Stock on Thursday morning. Well, I just got off of a conference call with the CEO of the company, and now I can say with absolute certainty we'll be sending you the info you need tomorrow right around 9:30 am EST. I already liked this stock, but after getting some more clarification and some perspective you just can't glean from mainstream news sources, I've absolutely fallen in love with this up-and-coming name.
Welcome to the weekend, one and all. Want to hear something a little depressing? For all its work, noise, and volatility of late, the S&P 500 closed today right where it closed in late February. Three and a half months of relatively stressful action, and stocks have nothing to show for it.
The really sad part is, I don't think we're out of this go-nowhere funk yet. Not only is June a historically bearish month, but June all the way through September is historically tepid... even if slightly bullish overall. Given how stocks are overvalued and overextended this summer though, I can still see this modestly-bullish four month span being at least a little bearish this particular year.
The market may have been up today, but honestly (and as you might have guessed), we're not impressed... at least not yet. It's going to take a lot more than one good day to jolt the market back into an uptrend, and as we've mentioned a couple of times in recent editions, that just doesn't appear to be in the cards right now. Aside from the sheer fact that stocks have been overbought for a while, we're also fighting the calendar. June is one of the worst months of the year for the market, on average, and also one of the few months where a loss of any size is just as likely as a gain of any size.
The big take-away from today's trading is that the 2072 level was verified as a key floor for the S&P 500. We had a pretty good inkling it was going to be a major support level after stocks rebounded at that mark on Monday, which is also where it happened to bounce back from pullbacks several times over the past couple of months. It's the dark dashed line on our daily chart of the S&P 500 below.
Welcome to the weekend, one and all. I don't know about you, but I'm ready for it. Before you get too far into whatever weekend plans you may have though, let's just invest a couple more minutes to make sure you know where the market ended on Friday and what it's likely to do in the coming week. Don't worry - we'll keep it short.
Yes, the market may have basically broken even this past week, but between the bearish start on Monday and the bearish finish on Friday, I think we have to continue seeing the bigger-picture trend as a bearish one.