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Today’s Summary
Friday, July 23rd, 2021
Indices: US Stocks ended the week on a positive note. The Dow, S&P 500, and Nasdaq all closed at record highs. The Dow rose 238 points or 0.68%, closing above 35,000 for the first time. The S&P 500 and Nasdaq gained 1.01% and 1.04%, respectively. The Russell 2000 underperformed, rising 0.46%.
Sectors: 10 of the 11 sectors closed higher. Communications led, gaining 2.48%. Energy lagged, falling 0.37%.
Commodities: Crude Oil futures inched higher by 0.22% to $72.07 per barrel. Gold inched lower by 0.20% to $1,802 per ounce.
Currencies: The US Dollar Index ticked higher by just 0.08%.
Interest Rates: The 10-year US Treasury yield fell to 1.278%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
S&P almost back to its prior high but equal weight and small cap relative performance almost back to multi-month lows. pic.twitter.com/VN87Gu7VrM
— Andrew Thrasher, CMT (@AndrewThrasher) July 23, 2021
Today’s Chart of the Day was shared on Twitter by Andrew Thrasher (@AndrewThrasher). It’s a chart of the S&P 500 over the past three months, along with four important risk ratios below. The week ended on a positive note, with the S&P 500 closing at a record high. While the index drifts higher, several key risk ratios continue to diverge, suggesting caution is warranted. Andrew points out that Small-Caps ($IWM), High Beta ($SPHB), and Equal-Weight ($RSP) are all still deteriorating on a relative basis. These divergences suggest narrow leadership and waning risk appetite. When it comes to divergences, legendary technician, Martin Pring once said it best; “A divergence is like a weather forecast of rain. When you hear the forecast on the radio, you go out with an umbrella. But the forecast is no guarantee of rain, just a warning sign that you should be prepared.”
Quote of the Day
“A mind is like a parachute. It doesn’t work if it is not open.”
– Frank Zappa
Top Links
Weekly Market Performance – Strong Week for Growth Stocks as Earnings Season is Underway – LPL Financial Research
The team at LPL Financial Research breaks down this week’s market performance.
XLE Bids to End Correction and Resume Uptrend – StockCharts.com
Arthur Hill examines the outlook for the Energy sector.
Stock Market & Bitcoin Analysis July 23, 2021 – AlphaTrends
Brian Shannon analyzes this week’s price action in Stocks and Crypto.
Will Green Metals Lead the Way? – All Star Charts
Ian Cully points out that green metals are showing relative strength (Lithium, Cobalt, Copper, Nickel).
August Has Been A Dangerous Month for the Market – Almanac Trader
Jeff Hirsch takes a look at how stocks have historically fared in August.
Top Tweets
Dow S&P and Nasdaq close at record highs, Dow finished above 35k for the first time ever
— Sara Eisen (@SaraEisen) July 23, 2021
S&P closed only 26 points below its ATH yesterday but A-D line is 4486 net advances below its old high. (Gap was 3245 net advances the day before.) Breadth divergences can and often are resolved in due time but this is definitely something to keep an eye on here. pic.twitter.com/neYck1Ub1a
— Walter Deemer (@WalterDeemer) July 23, 2021
9 of 11 sectors close up on the week, with 4 outpacing the +1.99% gain in the S&P 500 $SPY:
↗️ Comm. Services $XLC +3.26%
↗️ Cons. Discretionary $XLY +2.95%
↗️ Technology $XLK +2.81%
↗️ Health Care $XLV +2.18%↘️ Energy $XLE and Utilities $XLU finish lower pic.twitter.com/rc5M1exhQb
— Grayson Roze (@GraysonRoze) July 23, 2021
$ITB Homebuilders
nailed down a strong week +5.9%
(stronger than those big internet names $FDN +5.0%) pic.twitter.com/ozTsJefRXn
— Christian Fromhertz (@cfromhertz) July 23, 2021
2021 Returns…
US Internet Stocks $FDN: +18%, all-time high today
China Internet Stocks $KWEB: -28%, 52-week low today
Charting via @ycharts pic.twitter.com/ryNWPeak7z
— Charlie Bilello (@charliebilello) July 23, 2021
Emerging Markets really missed the all week bounce.
EEM Massively impacted by Chinese tech with KWEB -10% shower today.
Chinese tech versus Nasdaq peaked months ago.
Know what you own and what move an ETF! pic.twitter.com/yR8cIP4K7d— conradseric, CMT, CAIA, CEFA (@conradseric) July 23, 2021
$EEM break below its 40WMA and new lows relative to $SPY dragged lower by its 36% weighting in China. pic.twitter.com/mEFkJUJEdJ
— Bailey.Baxter2020 (@BBaxter2020) July 23, 2021
Crypto > Stocks if this one is above 7 #bitcoin $spx pic.twitter.com/LURe0vqCGB
— J.C. Parets (@allstarcharts) July 23, 2021
$CRB vs. $SPX Trailing 12 Months
Commodities ?⛏️ > Stocks ??️ pic.twitter.com/VmdwFoNgwq
— Shane C. Murphy (@murphycharts) July 23, 2021
The resilience in base metals has been impressive, but green metals associated with renewable energy have really turned it on in the last six weeks. $LIT, $REMX, #cobalt pic.twitter.com/sWJUvTeflU
— Ian Culley (@IanCulley) July 23, 2021
Domino's and Google IPO'd during summer 2004.
As big as Google is, people still like pizza. A lot. The performance of these two giants is something that surprises a lot of people.
After DPZ jumped 15% yesterday, the lead is only bigger.
(Not a recommendation of either stock) pic.twitter.com/MwOF24aKMy
— Ryan Detrick, CMT (@RyanDetrick) July 23, 2021
You’re all caught up now. Thanks for reading!