We have a short week this week due to Canada Day on July 1st and the American Independence Day Holiday on July 4th. The 2nd quarter is ending and we are entering the July earnings season. Also, due to the shorter week and impending holidays, this is also a busy news week in terms of economic reports. There are a number of sites on the internet which provide an economic calendar. The yahoo finance site is pretty good as the economic calendar also provides ratings for each report, indicating how important or how much influence the report tends to have on the market. Being aware of when these reports come out is an important aspect of the due diligence process, as many reports can have an impact on short term trading and affect certain sectors. They also provide a gauge of investor sentiment. I titled this post “beware quarter end” due to the fact that many fund managers have a tendency to spruce up their balance sheets as they are required to report results. This may account for the continued rally into the end of June. Many fund managers take the opportunity during the months of July and August to slowly build up positions for the next quarter and often dump poor performers in August and September. This is part of the reason for the seasonal fall rally that starts in October. This remains a value driven market, which means that earnings performance remains critical in evaluating potential investments. From a technical perspective, the indexes remain in relatively tight sideways trends.
Futures this morning are positive and the DAX is positive, indicating a positive open. The market bias indicators are indicating a statistical bias for a snapback down in the next one to five days. The market bias indicators are showing signs of quiet accumulation and a bias for an up day today.
| Index | Change | %Change | Level | Phase |
| TSX | +33.91 | +0.33% | 10389.76 | Warning |
| DJIA | -34.01 | -0.40% | 8438.39 | Bearish |
| Nasdaq | +8.68 | +0.47% | 1838.22 | Bullish |
| SP 500 | -1.36 | -0.15% | 918.90 | Bearish |
| Russell 2000 | +4.04 | +0.79% | 513.22 | Warning |
| NYSE | -4.07 | -0.07% | 5906.96 | Warning |
Source: Telechart
Short Term market outlook:
Bias: Scans showing a positive bias
Energy: weak
Primary Trend: sideways
| Sector | Phase |
| Consumer Staples | Recovery |
| Healthcare | Recovery |
| Technology | Bullish |
| Utilities | Recovery |
| Energy | Distribution |
| Financials | Bearish |
| Industrials | Bearish |
| Materials | Distribution |
| Consumer Discretionary | Bearish |
Source: Telechart
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