Author: Ivanhoff

MarketSurge powers the charts in this video.

Bull markets correct through sector rotations. We saw it last week. On July 1st, most momentum leaders sold off. The capital didn’t leave the stock market. It just rotated into other groups that have been lagging year-to-date – small caps, biotech, homebuilders, retailers, finance, etc. Such rotations are a normal part of the cycle. They are a sign that the bull market is expanding and encompassing more names. The wave is starting to lift more boats. There is more to choose from.

The next earnings season is a few weeks away, so the market is currently focused on the impact of the One Beautiful Bill and the trade deals with countries around the world. Vietnam agreed to pay 20% tariffs and 40% on transatlantic shipping. We are not going to discuss the longer-term consequences for the US consumer and companies, but focus on the immediate market reaction for now. The stocks of the companies that manufacture in Vietnam went higher – NKE, LULU, FSLR, BA, AAPL, etc. The Vietnam stock market made new 52-week highs. I suspect we will see a similar reaction to other deals – China, the EU, India, Latin America, Japan, etc.

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MarketSurge powers the charts in this video.

The conflict in Iran ended faster than anyone could imagine. This bolstered stocks around the world. Crude oil and gold pulled back. The Nasdaq 100 hit new all-time highs.

AI-related stocks remain the leading group. Micron (MU) reported better than expected quarter and gave bullish guidance tied to AI-chip demand. This helped the entire semiconductor sector. We saw strong moves in AMD, NVDA, ARM, etc. 

Even Nike rallied despite missing estimates and warning that tariffs could cost them $1Bn. Going up on bad news is the quintessential bullish sign as it reflects that the worst might already have been reflected. 

The market has priced in a trade deal with China and the EU. This doesn’t mean that we won’t see a rally in Chinese stocks once one is actually signed. Any negative surprise on the deal front can lead to a quick shake-out in most stocks. Pullbacks to 20 and even 50-day moving averages are normal in a bull market.

The market is open three and a half days next week. It is closed early on July 3rd, and it is closed on July 4th.

Try my subscription service, which includes a Discord room and private X feed with options and stock ideas, emails with concise market commentary, real-time market education, the Momentum 40 list of market leaders, and much more. See what subscribers say about my educational service.

Check out my free weekly email to get an idea of the content I share with members. How my ideas/alerts did.

You can find my trading books on Amazon here.

Disclaimer: Everything I share is for educational and informational purposes only, and it should not be considered financial advice. Read my full disclaimer here.

MarketSurge powers the charts in this video.

Bull markets climb a wall of worry. They keep brushing bad news off and find a way to continue rising. The most recent examples include the war in the Middle East, which spiked crude oil prices; the Fed’s reluctance to cut rates due to fears of higher future inflation; and the lack of any signed major trade deals. 

Despite everything, the dips in QQQ to its 20-day moving average have been consistently bought. We all know this is not going to last for too long. It is normal to see deeper pullbacks even in a bull market, especially in individual stocks. After all, bull markets don’t lift all boats equally; they are an environment for good stock pickers. Bull markets also tend to correct through rotations. We have seen lately how legacy stocks like AAPL, GOOGL, Visa, and Mastercard have been under pressure while recent IPOs like CRCL and CRWV have been on absolute fire.

Try my subscription service, which includes a Discord room and private X feed with options and stock ideas, emails with concise market commentary, real-time market education, the Momentum 40 list of market leaders, and much more. See what subscribers say about my educational service.

Check out my free weekly email to get an idea of the content I share with members. How my ideas/alerts did.

You can find my trading books on Amazon here.

Disclaimer: Everything I share is for educational and informational purposes only and it should not be considered financial advice. Read my full disclaimer here.