Stocks ended the week in a rather disturbing manner, with all the major indices limping home nearly unchanged for the day. That such a disappointment would occur on what's normally an options expiration day (it was), the lack of interest and volatility can be seen as a sign that either a) everybody who is anybody is on vacation, or, b) the market has reached saturation levels and is about to make a short term reversal.
None of the four averages followed at
Money Daily closed more than one tenth of one percent from the previous day's finish. Trading was akin to a grandparent's canasta tournament. Nothing was risked. Nothing was lost. Nothing was gained.
Friday's trading can also be seen as an thumbnail sketch for the week. Within narrow ranges, the majors all finished up the week not far from where they had begun. It was simply one of the dullest weeks of trading in recent memory.
As expressed in Thursday's post, "Crossroads," there appears to be a stopping point for everything, especially the Dow Industrials at the level of 25,000- 25,300. The Dow was weakened materially in February, and, despite glowing employment and unemployment figures, plus an expected second quarter GDP estimate of over four percent to be made public this coming week (8:30 am EDT, Friday) the industrial average has yet to re-approach the previous all-time high (26,616.71, January 23, 2018).
With such a well-telegraphed number expected, a 4% GDP for the second quarter is likely already well-baked into most portfolio cakes, thus it may be wise to sit out this particular glowing government data headline release.
That the new high event continues to fade into memory without the Dow making a significant rally attempt tells a great deal about current market conditions. It signals that there is something seriously damaged in the economy, and it's probably not confined to the United States, since the central banks have acted as first-movers and lenders of last resort since 2008-09.
Change is afoot, and with change there are usually winners and a good share of casualties along the way. A major shakeout in the market is long overdue, despite the united forces of central banks forestalling such a watershed event. This has been the overriding theme of the past decade. While it may not end this week or next, it will end, and the result will be a general decline of 30-50 percent in major stock indices.
Otherwise, all the math in the world can be throw out the nearest window.
In the meantime, trade cautiously with an eye on fundamentals, which eventually will guide the way.
Dow Jones Industrial Average July Scorecard:
| Date |
Close |
Gain/Loss |
Cum. G/L |
| 7/2/18 |
24,307.18 |
+35.77 |
+35.77 |
| 7/3/18 |
24,174.82 |
-132.36 |
-96.59 |
| 7/5/18 |
24,345.44 |
+181.92 |
+85.33 |
| 7/6/18 |
24,456.48 |
+99.74 |
+185.07 |
| 7/9/18 |
24,776.59 |
+320.11 |
+505.18 |
| 7/10/18 |
24,919.66 |
+143.07 |
+648.25 |
| 7/11/18 |
24,700.45 |
-219.21 |
+429.04 |
| 7/12/18 |
24,924.89 |
+224.44 |
+653.48 |
| 7/13/18 |
25,019.41 |
+94.52 |
+748.00 |
| 7/16/18 |
25,064.36 |
+44.95 |
+792.95 |
| 7/17/18 |
25,119.89 |
+55.53 |
+848.48 |
| 7/18/18 |
25,199.29 |
+79.40 |
+927.88 |
| 7/19/18 |
25,064.50 |
-134.79 |
+793.09 |
| 7/20/18 |
25,058.12 |
-6.38 |
+786.71 |
At the Close, Friday, July 20, 2018:
Dow Jones Industrial Average: 25,058.12, -6.38 (-0.03%)
NASDAQ: 7,820.20, -5.10 (-0.07%)
S&P 500: 2,801.83, -2.66 (-0.09%)
NYSE Composite: 12,789.91, +3.43 (+0.03%)
For the Week:
Dow: +38.71 (+0.15%)
NASDAQ: -5.78 (-0.07%)
S&P 500: +0.52 (+0.02%)
NYSE Composite: +20.41 (+0.16%)
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