The Safe Investing Blog

Stock Market Outlook entering the Week of August 10th = Uptrend

• Average Directional Index: Uptrend
• Institutional Activity: Uptrend
• On Balance Volume: Uptrend

ANALYSIS
The stock market outlook continues to show an uptrend for U.S. equities.

The S&P500 ( $SPX ) rose 2.4%.  The index sits ~3% above the 50-day moving average and ~8% above the 200-day moving average.

The ADX directional indicator rejoins Institutional Activity and On-Balance Volume in bullish territory.  Distribution days ticked up heading into August; something to keep an eye.

SPX Price & Volume Chart for Aug 10 2025

PERFORMANCE COMPARISONS
Consumer Discretionary ( $XLU ) led sectors higher, while Energy and Healthcare ( $XLE & $XLV ) underperformed.  Discretionary, Staples, and Financials ( $XLY, $XLP, $XLF ) returned to bullish bias; Materials ( $XLB ) eased back to Neutral and Energy ( $XLE )  fell to bearish.

S&P Sector Performance from Week 32 of 2025

All sector styles gained last week; Mega Cap Growth ( $OEF ) led the charge and High Beta ( $SPHB ) brought up the rear.  Last weeks laggards ( $SPLV, $IWN, $IJJ, $IWX, $SPHD ) all regained bullish bias.

Sector Style Performance from Week 32 of 2025

In a reversal from the prior week, Oil ( $USO ) underperformed other assets and Bitcoin ( $IBIT ) outperformed. Oil also fell back to bearish bias.

Asset Class Performance from Week 32 2025

COMMENTARY
Earning season is winding down and a majority of companies (>80%) beat their Q2 earnings estimates.  Most estimates were lowered in anticipation of tariffs, which were largely delayed until earlier month, so that feat is slightly less impressive than it first appears. The full impact of new tariffs likely hits Q4 earnings data. Year over year earnings growth in quarterly earnings is still positive though, which is good.

ISM Services PMI dropped to 50.1 in July, down from June’s from 50.8 in June and below forecasts of 51.5. Within that data, the Services Prices Index rose to 69.9, the highest since October 2022. For reference, this sub-index measures the prices that service businesses are paying for inputs (e.g. materials and services), and is a key indicator of inflationary pressures in the services sector.

This week we get the latest CPI and PPI inflation data, along with retail sales and consumer sentiment.

Elsewhere, President Trump signed an executive order to expand Americans’ access to alternative investments in their 401(k) retirement plans (cryptocurrency, private equity, and real estate). While a lot of ink was spilled about the impact on financial markets, keep in mind this is the federal government we’re talking about, so changes could take years.

First, the SEC, U.S. Treasury, and Department of Labor need to rewrite the regulations that define what qualifies as a permissible 401(k) asset. Then 401k providers must provide new investment options within those rules.  And then employers add those options to their 401k plans.

Despite the bounce back by several sectors and styles, August is a seasonally weak period for U.S. equities, and another reason we raised some caution flags last week.  Since 1990, this time period has the highest rate of change in volatility, and the second worst monthly returns.  The worst monthly returns?  September.  So don’t be surprised if prices continue to chop around.  Take an extra moment to review your stop levels, max loss amounts, and profit targets for any new and/or existing positions.

Best to Your Week!

P.S. If you find this research helpful, please tell a friend.
If you don’t, tell an enemy.

Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis, Hedgeye, Stockcharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics, TradingEconomics.com

Invest Safely, LLC is an independent investment research and online financial media company.  Use of Invest Safely, LLC and any other products available through invest-safely.com is subject to our Terms of Service and Privacy Policy.

Not a recommendation to buy or sell any security.

Stock Market Outlook entering the Week of August 3rd = Uptrend

• Average Directional Index: Neutral
• Institutional Activity: Uptrend
• On Balance Volume: Uptrend

ANALYSIS
The stock market outlook remains in an uptrend for U.S. equities, although high volume selling and bearish bias shifts are cautionary signs.

The S&P500 ( $SPX ) fell 2.4%.  The index sits ~2% above the 50-day moving average and ~6% above the 200-day moving average.

The ADX directional indicators are on the verge of a cross-over (i.e neutral), but the other two signals remain bullish entering the week.

SPX Price & Volume Chart for Aug 03 2025

PERFORMANCE COMPARISONS
The Utilities sector ( $XLU ) was the only gainer last week; Materials ( $XLB ) led to the downside. Consumer Discretionary, Energy, and Financials ( $XLY, $XLE, $XLF ) downshifted to neutral bias, while Staples, Healthcare, Materials, and Real Estate ( $XLP, $XLV, $XLB, $XLRE ) all dropped to bearish.

S&P Sector Performance from Week 31 of 2025

All sector styles were lower last week; Momentum ( $MTUM ) escaped with the least damage, while Small Cap Value ( $IWN )  was hardest hit.  Low Beta, Small/Mid/Large Cap Value, and High Dividend ( $SPLV, $IWN, $IJJ, $IWX, $SPHD ) fell to neutral bias.

Sector Style Performance from Week 31 of 2025

Oil ( $USO ) outperformed other assets and Bitcoin ( $IBIT ) underperformed. Oil, gold, and bonds ( $USO, $GLD, $IEF ) all returned to bullish bias, and the U.S. dollar ( $DXY )  improved to neutral.

Asset Class Performance from Week 31 2025

COMMENTARY
U.S. equities weren’t a fan of the macro data dump.  June job openings (JOLTs) fell slightly and missed expectations, but not by much.  The first Q2 GDP estimate came in at 3%, which is unchanged year over year, but above expectations and significantly better than last quarter’s read.

So it’s not all that surprising the FOMC held rates steady, citing a low unemployment rate, somewhat elevated inflation, and persistent uncertainty about the economic outlook (i.e. impact of tariffs).

The subsequent PCE data release showed inflation rising in June (on a year over year basis), and that’s after an upward adjustment of 0.2% to May’s Headline and Core figures.

We continue to see a pattern of prior core and headline PCE data revised higher the following month…not enough to influence policy, but certainly enough to start asking questions.

Enter July Non-Farm Payrolls.  Friday’s NFP data showed an increase of 73,000 jobs in July, well below expectations of 110,000. Not great, but not awful either. The report also revised June and July figures as well:

• June payroll data was lowered from 147K to 14K ( -90% )
• May payroll data was lowered from 144k to 19k ( -87% )

Those are massive revisions, and points out a weaker labor market than the one used to set policy.  Granted, NFP is just a directionally correct estimate, derived from small surveys and models each month.  But even the higher accuracy, lower speed data (Quarterly Census of Employment and Wages or QCEW) shows a growing rift with NFP estimates, which all suggests that even “directionally correct” may be a stretch.

So what’s a safe investor supposed to do?  Watch asset prices and use fundamental/macro data as confirmation.  The breakout in bonds (i.e. rates down) and the U.S. dollar is a deflationary signal, but equity indexes are still bullish.

In the meantime, when sectors, styles, or asset classes downshift into bearish bias, it’s time to adjust their respective position sizes.  At the very least, dropping the position to your minimum size is warranted, while exiting the position all together is a safer play, especially if the ticker covered by more than one category (e.g. $XLP and $SPLV).

Best to Your Week!

P.S. If you find this research helpful, please tell a friend.
If you don’t, tell an enemy.

Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis, Hedgeye, Stockcharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics

Invest Safely, LLC is an independent investment research and online financial media company.  Use of Invest Safely, LLC and any other products available through invest-safely.com is subject to our Terms of Service and Privacy Policy.

Not a recommendation to buy or sell any security.

Stock Market Outlook entering the Week of July 27th = Uptrend

• Average Directional Index: Uptrend
• Institutional Activity: Uptrend
• On Balance Volume: Uptrend

ANALYSIS
The stock market outlook shows an uptrend for U.S. equities, after breaking out from its recent consolidation.

The S&P500 ( $SPX ) gained 1.5% last week.  The index sits ~5% above the 50-day moving average and ~9% above the 200-day moving average.

All three technical indicators remain bullish.

SPX Price & Volume Chart for July 27 2025

PERFORMANCE COMPARISONS
Every sector improved last week, but in a reversal of recent trends, it was Healthcare ( $XLV ) outperforming and Technology ( $XLK ) underperforming.  Healthcare ( $XLV ) jumped back into a bullish bias, and Consumer Staples improved to neutral.

S&P Sector Performance from Week 30 of 2025

All the sector styles also rose; oddly, it was Defensives ( $POWA ) outperforming, and Small Cap Growth underperforming.  Low Beta ( $SPLV ) moved to bullish bias.

Sector Style Performance from Week 30 of 2025

For the second week running, Equities ( $SPY ) outperformed and Oil ( $USO ) underperformed.  Oil and gold moved to neutral bias, and the U.S. dollar fell back to bearish after a recent rally attempt.

Asset Class Performance from Week 30 2025

COMMENTARY
For the week ahead, a full plate of economic headlines for the market to digest, including: June job openings (JOLTs), the first Q2 GDP reading, a FOMC interest rate decision,  PCE inflation, July non-farm payrolls, and ISM manufacturing manufacturing PMI.

Keep an eye on the response from assets prices, particularly treasury yields (interest rates), the U.S. dollar, and gold.  All three have been consolidating the past 6 weeks or so, and the shifts to and from neutral bias during that timeframe may indicate their respective trends are losing momentum and a shift in the macroeconomic regime is in play.

Best to Your Week!

P.S. If you find this research helpful, please tell a friend.
If you don’t, tell an enemy.

Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis, Hedgeye, Stockcharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics

Invest Safely, LLC is an independent investment research and online financial media company.  Use of Invest Safely, LLC and any other products available through invest-safely.com is subject to our Terms of Service and Privacy Policy.

Not a recommendation to buy or sell any security.

Stock Market Outlook entering the Week of July 20th = Uptrend

• Average Directional Index: Uptrend
• Institutional Activity: Uptrend
• On Balance Volume: Uptrend

ANALYSIS
The stock market outlook shows an uptrend for U.S. equities.

The S&P500 ( $SPX ) gained 0.6% last week.  The index sits ~5% above the 50-day moving average and ~7% above the 200-day moving average.

All three technical indicators remain bullish after a second week of consolidation.

S&P Sector Performance from Week 29 of 2025

PERFORMANCE COMPARISONS
Tech ( $XLK ) outperformed last week; Energy ( $XLE ) was the worst sector, losing the prior week’s gains.  Healthcare ( $XLV ) fell back to bearish bias, joining Consumer Staples.

S&P Sector Performance from Week 29 of 2025

For sector styles, Large Cap Growth ( $IWF ) outperformed; Value underperformed, with Small caps down ( $IWN ) the most.  No changes in bias last week.

Sector Style Performance from Week 29 of 2025

As far as asset classes are concerned, equities ( $SPY ) were the best, while Oil ( $USO ) was the worst.  The most important event, macro-wise, was the U.S. Dollar moving to neutral bias.  Continued dollar strength would be the first step towards a shift in the macro environment ( i.e. which assets/sectors provide the best returns ).

Asset Class Performance from Week 29 2025

COMMENTARY
June inflation data was mixed, retails sales were strong, and earnings season is off to a good start.

Headline and Core CPI increased in June, though the moves were not unexpected.

Headline and Core PPI fell in June, although May data was revised higher again.

A little more than 10% of the S&500 reported earnings last week, and most are exceeding forecasts. Those forecasts were lowered in response to tariffs, but still a good sign.

Federal Reserve Chairman Powell gives a speech before the market opens on Tuesday, so expect some volatility.  We’ll also see existing home sales and the latest durable goods orders released during the week.

Best to Your Week!

P.S. If you find this research helpful, please tell a friend.
If you don’t, tell an enemy.

Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis, Hedgeye, Stockcharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics

Invest Safely, LLC is an independent investment research and online financial media company.  Use of Invest Safely, LLC and any other products available through invest-safely.com is subject to our Terms of Service and Privacy Policy.

Not a recommendation to buy or sell any security.

Stock Market Outlook entering the Week of July 13th = Uptrend

• Average Directional Index: Uptrend
• Institutional Activity: Uptrend
• On Balance Volume: Uptrend

ANALYSIS
The stock market outlook shows a continuing uptrend for U.S. equities.

The S&P500 ( $SPX ) fell 0.3% last week.  The index sits ~5% above the 50-day moving average and ~7% above the 200-day moving average.

All three technical indicators remain bullish after a lower volume consolidation during the week.

SPX Price & Volume Chart for July 13 2025

PERFORMANCE COMPARISONS
Energy ( $XLE ) outperformed the market index, while Communications and Financials ( $XLC & $XLF ) underperformed.  Consumer Staples ( $XLP ) continues to struggle finding a direction, falling back to bearish bias.

S&P Sector Performance from Week 28 of 2025

Most sector styles struggled last week; High Beta ( $SPHB ) outperformed, Momentum ( $MTUM ) underperformed.  Low Beta ( $SPLV ) slipped back to neutral bias.

Sector Style Performance from Week 28 of 2025

Bitcoin rallied more than 8%, as cryptocurrencies soared last week ( e.g. $ETHE , $OSOL )  leading asset class returns listed below.  Gold ( $GLD ) was surprisingly quiet, given the outperformance seen by other metals like copper and palladium ( $CPER & $PALL ). Bonds ( $IEF ) continued their recent slide lower.  Unfortunately, these moves suggest inflationary pressures, none of which supports the case for rate cuts.  No changes to bias versus last weekend.

Asset Class Performance from Week 28 2025

COMMENTARY
In the absence of major macroeconomic headlines, U.S. tariffs took center stage.  14 countries received updated tariff “letters”, ranging from 25% to 40%, with a new implementation date of August 1.  Markets took the announcements in stride; just the latest escalation in the ongoing trade war.

But over the weekend, the U.S. announced 30% tariffs on the European Union and Mexico; odds are this will provoke more of a reaction from markets when futures trading opens Sunday evening.

In addition to more tariff headlines (we’re still waiting on China), the latest inflation readings ( CPI & PPI ) are released this week, along with retail sales and housing figures.  Earnings season also kicks off, with financial institutions reporting second quarter results and providing their insights into the rest of 2025.

Best to Your Week!

P.S. If you find this research helpful, please tell a friend.
If you don’t, tell an enemy.

Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis, Hedgeye, Stockcharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics

Invest Safely, LLC is an independent investment research and online financial media company.  Use of Invest Safely, LLC and any other products available through invest-safely.com is subject to our Terms of Service and Privacy Policy.

Not a recommendation to buy or sell any security.

Stock Market Outlook entering the Week of July 6th = Uptrend

• Average Directional Index: Uptrend
• Institutional Activity: Uptrend
• On Balance Volume: Uptrend

ANALYSIS
The stock market outlook shows a continuing uptrend for U.S. equities.

The S&P500 ( $SPX ) gained 1.7% last week.  The index sits ~7% above the 50-day moving average and ~8% above the 200-day moving average.

All three technical indicators remain bullish heading into the week, with the index showing strong price action since the quarterly option expiration on June 23.

SPX Price & Volume Chart for July 06 2025

PERFORMANCE COMPARISONS
A positive week across all sectors last week, with Materials ( $XLB ) leading the pack, and Utilities ( $XLU ) bringing up the rear.  Consumer Staples ( $XLP ) and Healthcare ( $XLV ) rejoined the other sectors with bullish bias.

S&P Sector Performance from Week 27 of 2025

All sector styles were green last week as well, with small cap value ( $IWN ) and Momentum ( $MTUM ) bookending performance.  No bias changes last week, all the styles remain bullish.

Sector Style Performance from Week 27 of 2025

Oil and Equities ( $USO & $SPY ) outperformed other asset classes, while bonds ( $IEF ) lost some ground.  Oil and Gold ( $USO & $GLD ) returned to bullish bias (from neutral); bonds returned to neutral.

Asset Class Performance from Week 27 2025

COMMENTARY
The summer trading season is here and that normally brings lower trading volumes and fewer “big” moves in the indexes. This year may be different, if the first half was any indicator.

No signs of weakness in the labor market yet, with JOLTs / NFP data surprisingly positive.  Both Manufacturing and Services PMI’s were slightly higher as well.  Both of these data points pushed estimates for FOMC rate cuts further into the future.

The U.S. Congress passed its latest tax and spending bill, which is heavier on spending than taxes and likely has a stimulative effect on the economy in the near-term.

This week lacks major macroeconomic data, but expect a flurry of headlines nonetheless, since the 90-day tariff “pause” ends mid-week. On Monday, the U.S. begins informing other countries of the tariff rate on their imports, set to start on August 1. The U.S. reached an agreement with Vietnam last week, but most other countries are in some stage of agreeing to agree on frameworks. The situation probably isn’t resolved soon; Treasury Secretary Scott Bessent implied the goal is to be done with trade deals by Labor Day.

Best to Your Week!

P.S. If you find this research helpful, please tell a friend.
If you don’t, tell an enemy.

Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis, Hedgeye, Stockcharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics

Invest Safely, LLC is an independent investment research and online financial media company.  Use of Invest Safely, LLC and any other products available through invest-safely.com is subject to our Terms of Service and Privacy Policy.

Not a recommendation to buy or sell any security.

Stock Market Outlook entering the Week of June 29th = Uptrend

• Average Directional Index: Uptrend
• Institutional Activity: Uptrend
• On Balance Volume: Uptrend

ANALYSIS
The stock market outlook continues to show an uptrend in place, with equity indexes returning to all time highs.

The S&P500 ( $SPX ) gained 3.4% last week.  The index sits ~6% above the 50-day moving average and ~6% above the 200-day moving average.

SPX Price & Volume Chart for June 29 2025

All three technical indicators are bullish after last week’s price and volume action.

PERFORMANCE COMPARISONS

S&P Sector Performance from Week 26 of 2025

The Communications sector ( $XLC ) led to the upside with Technology ( $XLK ) a close second, thanks to Mag 7 companies.  After recently leading stocks higher, Energy ( $XLE ) sold off with oil prices.  No changes in bias last week.

Sector Style Performance from Week 26 of 2025

All styles gained ground last week, with High Beta ( $SPHB ) leading the way and High Dividend ( $SPHD ) bringing up the rear.  Low Beta and High Dividend styles ( $SPLV & $SPHD ) bounced back to bullish bias.

Asset Class Performance from Week 26 2025

Bitcoin and Equities ( $IBIT & $SPY ) outperforming other asset classes, reflecting a risk-on environment.  Oil ( $USO ) cratered, falling almost 12% and giving back a little more than half of it’s gain over the past 4 weeks.  Oil and Gold ( $USO & $GLD ) retreated to neutral bias, while bonds ( $IEF ) make another swing into bullish territory.

COMMENTARY
Geopolitical headlines continue to drive market volatility as we close out the June and the second quarter. Conflict deescalation and easing tensions in the Middle East mitigated the recent spike in oil prices, while social media posts concerning trade deals with Canada and China caused large, intraday price swings in equities. This environment will extend into early July, at least, as markets key-in on the expiring suspension of “Liberation Day” tariffs.

Federal Reserve Chairman Powell testified before Congress last week, focusing on the potential inflation in response to tariffs. He repeated recent comments that the FOMC well-positioned to wait and see how the economy responds before making a decision on interest rates.

Durable goods orders spiked in May, rising 16.4%, after dropping ~7% in April, highlighting tariff uncertainty moving through supply chains.

PCE showed inflation rising in 0.1% in May, and that’s after an upward adjustment of 0.1% to April’s Headline and Core figures.

And finally, the final GDP revision shows the economy contracted by 0.5% in the first quarter, down from the second estimate at -0.2%, and falling 1.1% year-over-year. The third estimate was lower mainly as a result of downward revisions to consumer spending and exports.

A short trading week ahead, with U.S. markets closing early on Thursday and completely on Friday for Independence Day.

Best to Your Week!

P.S. If you find this research helpful, please tell a friend.
If you don’t, tell an enemy.

Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis, Hedgeye, Stockcharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics

Invest Safely, LLC is an independent investment research and online financial media company.  Use of Invest Safely, LLC and any other products available through invest-safely.com is subject to our Terms of Service and Privacy Policy.

Not a recommendation to buy or sell any security.