Deep Dive Update for Monday July 14, 2025

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This weekly video update analyzes daily market charts, focusing on the S&P 500 and related indicators, prepared for Monday, July 14, 2025. Key points:
1. Long-Term VIX (Fear Gauge): Currently below 20, indicating lower market fear as the S&P 500 hits all-time highs. VIX momentum (RSI) is dropping, and volume is below average, typical for summer. No extreme readings, so VIX momentum is not currently featured in daily videos.
2. Market Sentiment Indicators:
VIX/VVIX Ratio: Declining, suggesting positive market sentiment as VIX drops faster than VVIX.
SKEW Index: High in late June/early July but has since dropped, indicating reduced anticipation of large market moves.
Ulcer Index: Below its moving average, showing reduced market fear.
Stock vs. Bond Volatility Ratio: Declining, favoring stocks as they rise.
Large Cap vs. Small Cap Ratio: Small and mid-caps showed strength until Friday’s pullback, but large caps still dominate.
3. S&P 500 Performance:
Above the 200-day moving average by 6.87%, not at extreme levels (12-15%) that might signal a pullback.
Anchored moving averages are trending up, acting as potential support in declines.
Cumulative advance-decline lines for S&P 500 and NYSE are near all-time highs, confirming positive trends despite low volume.
4. Sector and Market Insights:
Large-cap growth ETFs and momentum stocks are strong, with QQQ (NASDAQ 100) leading at a technical score of 78.
Small and mid-caps improved but weakened on Friday, ranking lower (41.6 and 42.1, respectively).
Transports and regional banks show improvement but remain range-bound.
Financial sector underperforms the S&P 500, with bank ETFs awaiting earnings reports.
Gold and emerging markets lagging behind the S&P 500 and developed markets.
5. Bonds and Inflation:
Ratios including cash vs. 3-7-year bonds and TIPS vs. bonds suggest the market is not concerned about inflation or rising interest rates.
Two-year treasury yields are declining, creating a market-friendly environment.
6. Seasonal Trends:
Historical data from 2023 and 2024 shows strong July starts followed by pullbacks that can continue into October. The second half of July often underperforms, with August and September potentially weak.
Recent positive news sentiment shifted slightly negative on Friday due to trade and tariff news.
7. Technical Indicators:
Short-term and intermediate-term trends remain positive, with prices above moving averages (20, 50, 100 periods).
Long-term trends are improving, though the Special K oscillator remains negative on the daily chart.
No significant signals from Conor's RSI, daily mass index, or point-and-figure charts.
8. Global Markets:
German DAX set recent all-time highs but retraced slightly. U.S. stocks recently outperforming German stocks.
Eurozone stocks outperforming U.S. bonds, but correlations between U.S. and German yields are diverging.
Conclusion: The market remains positive, with the S&P 500 and NASDAQ 100 setting all-time highs. Low volatility and improving technicals support the uptrend, but seasonal weakness in late July and August, combined with recent negative news, warrants caution. Small caps and financials showing mixed signals, while inflation concerns remain low.

PDF of Slides:
https://drive.google.com/file/d/1is075Ueazctqz5ex6bhr-xSbSO0dCajY/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!