MarketSurge powers the charts in this video.
The indexes might’ve hit their annual high already, at least for the next few months. US stocks tend to struggle in August and September, particularly in the second year after elections. Seasonality might sound unserious to many, but so far, the market has been following the script relatively closely. It would be irrational not to pay attention to it.
This doesn’t mean that there won’t be any stocks making new highs and advancing. After all, bull markets are stock pickers’ markets. There are always stocks that significantly outperform the averages. The one major trend so far this season is the strong performance from companies related to AI, ranging from data center components to energy sources. We saw it again last week with big moves in META, CDNS, CLS, GLW, MPWR, MSFT, NVT, RMBS, SANM, etc. I am not saying to go and chase those stocks. Most are extended and need time to set up again. The pullback to their 20 and 50dma are likely to attract buyers and help them form new bases and better entry points.
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