Although there’s going to be some overlap with this and what we just examined in the prior post’s ETF charts, let’s look at a few updated cash index markets. The general thing I can say – – and this is going to sound lame on a truly Elliott Wave level, but here goes – – is that the market will belong to the bulls until at least the August 5th trendline is broken. There’s nothing bearish about any of the major index charts. They just keep chugging higher, without a care in the world. The NASDAQ Composite certainly fits that description.
The Dow Industrials is even more brazen. In fact, it could drop a full 3,000 points and not damage its overall ascending trendline.
Tech stocks, in spite of the modest headwinds semiconductors have encountered, are muscling to lifetime highs on a daily basis again. The positive seasonality and doe-eyed optimism about the forthcoming administration are simply helping.
The story with the S&P 100 is indistinguishable from that of the S&P 500.
Perhaps the most terrifying of all to the two or three (OK, let’s be real, ONE) bear left on Earth is the small caps, which seem poised for a multi-year continuation of this rally.
The only glimmer of faintest hope for any price weakness is in the land of semiconductors, which has been grinding away for months now, the go-go days of pre-July a distant memory at this point. AI Fever seems to have taken, at best, a meaningful pause.
Yet until there is some sustainable sea change, such as a mountain of earnings shocks, the public seems content to continue hurling trillions into stocks, with sentiment levels and optimism at heights heretofore thought unimaginable.
Even the Dow Transports, long a laggard, have hammered out an impressive base, so long as prices don’t penetrate back into that blue zone.
One chart, more than any other, captures the zeitgeist nicely. The VIX is in the sub-teens (compared to the level of nearly 90 during the Covid crash) and is at a level rarely experienced during the past six years. Complacency, contentment, optimism, and an utter lack of fear rule o’er the land.
Maybe it’s time for a surprise named 2025.
