S&P 500 Daily Update for Friday July 18, 2025

Link to The SPX Investing Program https://spxinvesting.substack.com

Link to The Daily Pivot Newsletter: https://thedailypivotnewsletter.substack.com/

Join to get access to perks:
https://www.youtube.com/channel/UCxlaGAKm2ApEs13O1gWDltg/join

Market Update Summary for Thursday, July 17, 2025
Outlook for Friday, July 18, 2025
Market Performance on July 17:
Indices at All-Time Highs: The S&P, NASDAQ, and NASDAQ 100 hit new all-time highs, with the S&P closing slightly below 6,300, up 0.54%. Volume was above average, indicating stronger conviction.
Sector Performance: Small and mid-caps performed well but need more follow-through. Growth sectors (tech, communication, discretionary) lagged slightly, while defensive sectors including real estate and healthcare were down. Financials showed improvement.
Economic Indicators:
Retail Sales: Up 0.6% (exceeding 0.2% expectations), a positive sign after two months of declines.
Jobless Claims: Initial claims at 221,000, back in a stable range; continuing claims under 2 million at 1.956 million.
Philadelphia Fed Index: Strong at 15.9 (vs. expected -0.2). Import and export prices slightly down, housing market index stable at 33, business inventories unchanged.
Inflation and Fed Policy: CPI was hotter than expected, but PPI was weaker. No rate cut expected in July; Fed in "wait and see" mode, anticipating a soft landing. Concerns about tariff-driven inflation persist, though tariffs are adding government revenue.
Technical Indicators:
Positive across all time frames (above moving averages), but internal weakness noted (e.g., declining bullish percent index, negative momentum oscillators).
Parabolic SAR flipped positive after a one-day negative signal. Short-term RSI is extremely positive; TTM squeeze remains negative but in extreme positive territory.
Sentiment is highly positive (Fear and Greed Index at 75), though some hedging is evident (rising equity put-call ratio).
Other Markets: Gold up over 25% in 2025, best-performing asset. The dollar and interest rates rose slightly (4.6% rounded). Liquidity is supporting stocks.
Concerns and Observations:
Internal market weakness despite new highs, with some oscillators (e.g., MACD, Swenlin Trading Oscillator) showing negative signals.
Seasonality suggests potential weakness in the second half of July, historically underperforming the first half. The week after options expiration (July 18) often sees declines.
Geopolitical risks (Israel-Iran, Russia-Ukraine) and tariff/trade war developments could impact markets but currently have minimal effect.
Financial sector underperforming the S&P is a concern, though improving.
Outlook for Friday, July 18:
Economic Reports: Housing starts, building permits, and consumer sentiment data due, potentially impacting real estate and broader market sentiment.
Seasonality: Historically positive for July 18, but caution advised due to options expiration and potential post-expiration weakness.
Technical Outlook: Trend remains positive across all time frames, but internal weaknesses (e.g., declining bullish percent indexes, negative momentum) warrant caution.
Risks: Monitor geopolitical escalations, trade/tariff news, and economic data for potential market movers.
Conclusion: The S&P 500 remains bullish, setting new highs with a solid economy, but internal weaknesses and seasonal patterns suggest caution. No rate cuts are expected, and the Fed is monitoring inflation and tariffs. Stay vigilant for Friday’s economic reports and potential volatility around options expiration.

PDF of Slides: https://drive.google.com/file/d/1uZ_JXfKLu-Svs2kiNn8orBr08hAVKvyV/view?usp=sharing

DISCLAIMER This video is for entertainment purposes only. I am not a financial adviser, and you should do your own research and go through your own thought process before investing in a position. Trading is risky!