Technically Speaking – July

August 6, 2024

Long Term Resistance    SP500           5,680

Long Term Support         SP500           5,070 then 4,900

The markets saw a mixed month during July, with the S&P 500 finishing the month up about 1%, the NASDAQ finishing down 1% and the DOW finishing up 4%. Tech, which has been the driving factor in the recent market rally, had a pullback during July, which is the main reason the NASDAQ dropped for the month. The S&P has a resistance level of around 5,680, and the support level remained around 5,300 then 5,200 for July. However, the S&P broke below that support level in the first three trading days of August, due to global economic pressure. The next support level is now around 5,070.

We are continuing to see the shift from tech to small cap, mid cap and value stocks. The Fed said it will hold rates steady for now and could possibly start cutting in September amid lower inflation and a cooling job market. The markets are looking to stabilize after three straight down trading days to begin August.

We have continued to be patient with cash on the side and mitigating risk where we can. We have begun putting money to work in small-cap and mid cap ETFs, along with the equal weighted S&P 500 ETF. This recent drop has also presented buying opportunities in the tech sector, which has been tough to build positions in over the year or so. But with that, we can still be patient when building positions because the money markets are still paying high interest. We will continue to use this strategy as we head in to the next Fed meeting and election.