Weekly Review - 2026-June-12
Look who's back! (for a short while...)
Last Week’s Comment: Touch & Go at the 50D SMA. Friday price failed to break above 20D SMA, which will be the level to watch next week/s.
Level 1: Why is it happening?
Economic Data: Production: ISM PMI vs. SPX
Analysis: No changes since last week.
Current Situation: Bullish
Future Outlook: Bullish
Economic Data: Production: Dallas & Philadelphia Manufacturing vs. SPX
Analysis: No changes since last week.
Current Situation: Neutral
Future Outlook: Bullish
Economic Data: Consumption: Consumer Sentiment
Analysis: Increase on sentiment, yet still below this year’s highs.
Current Situation: Neutral
Future Outlook: Bullish
Interest Rates: FED, 2yr, 10yr, and 30yr Rates
Analysis: May the worst be over? Inflation was high, as expected, but also known to be temporary due to the Iran war. If that gets resolved (and it seems so) then we may be headed towards a deflationary period were we could see the Fed even lowering rates.
Current Situation: Bearish
Future Outlook: Neutral
Context Investors Sentiment: Credit Spreads
Credit spreads move in tandem with the S&P, but when they diverge, that’s often an early warning signal.
Analysis: Spike on Friday after a yo-yo week.
Current Situation: Bullish
Outlook: Bullish
Level 1: Why is it happening? Summary
Economic Data (long-term): Bullish/Bullish
Interest Rates: Bearish/Neutral
Investors Sentiment: Bullish/Bullish
Level 2: What is happening?
Price Action: SPX – Long Trend – 20 & 10 years
Analysis: Price re-entered the 10Y channel. The 20Y channel is still quite far down (circa 7,200 area).
Current Situation: Bullish
Future Outlook: Bearish
Price Action: RSP – Trend – Weekly & Daily
Analysis: Shooting star on the weekly chart right at the top and with a bearish divergence with RSI. In the daily chart we see how MACD is about to create a bearish cross at high levels. I’m downgrading the outlook from neutral to bearish.
Current Situation: Bullish
Future Outlook: Bearish
Breadth & Volatility: % Stocks above SMAs vs. RSP
Above 200 Daily SMA
Above 20, 50, and 200 Daily SMAs
Analysis: Breadth is expanding and we have room to run. We remain on bullish territory.
Current Situation: Bullish
Future Outlook: Bullish
Breadth & Volatility: Bullish Pct. Index & McClellan Summation Index
Analysis: Both indicators continue in their bullish areas and turning to point higher.
Current Situation: Bullish
Future Outlook: Bullish
Breadth & Volatility: Ratio Low Volatility Stocks / SPY vs. SPY and RSP
Analysis: The signal reset in just two weeks from an over-extended situation with a bearish outlook (due to that over-extension) to touch the signal line, so coming back to a neutral position, yet remaining in the bullish area.
Current Situation: Bullish
Future Outlook: Bullish
Breadth & Volatility: New Highs vs. SPY & RSP
Analysis: No extreme signal, yet we remain on a bullish outlook.
Current Situation: Neutral
Future Outlook: Bullish
Breadth & Volatility: VIX vs. SPY & RSP
This chart is mainly to detect market bottoms.
Analysis: VIX touched level 23 and sharply dropped below 18. This opens up a neutral-to-bullish outlook, but resets the current trend. To decide if we have entered a new trend, we zoom in to the 1 hour level and we can see how the upward trend was broken and we could possibly be on a downward trend.
Current Situation: Bullish
Future Outlook: Neutral-to-Bullish
Options: (Inverted) Put/Call Ratio vs. SPY
Analysis: For this week, I wanted to compare a similar situation where the indicator is above (below as it is inverted) the 0.5 level (dotted red line) and trending downwards. For that I had to go back to the last two times we had a similar situation. End of 2021 and summer 2023. Both instances where having a bullish situation but ended up leading towards a bearish situation, long in the first case, and quite short on the second case. In 2022 the Fed raised rates at the fastest pace ever, so I tend to believe that in 2026 we may repeat 2023, more than 2022.
Current Situation: Bullish
Future Outlook: Bearish
Options: Gamma Exposure – SPX
Analysis: We are in positive GEX territory, yet very close to the GEX flip.
Current Situation: Bullish
Outlook: Neutral
Level 2: What is happening? Summary
Price Action: Bullish/Bearish
Breadth & Volatility: Bullish/Bullish
Options: Bullish/Bearish
Level 3: Where is it happening?
Bulls vs. Bears: RSP vs. RSPD (Cons. Disc. – Bulls) and RSPS (Cons. Sta. – Bears)
Analysis: Ratio (yellow) just closed a higher low pattern, correlated with the higher low seen at the bulls (green).
Current Situation: Bearish-to-Neutral
Future Outlook: Bullish
Sectors Rotation
Market & Economy Rotation
US Sectors order by ISM PMI Correlation (between parenthesis)
Growth Sectors - shall outperform when the market is bullish:
XLK: Technology (71%)
XLY: Cons. Discretionary (67%)
XLI: Industrials (66%)
XLB: Basic Materials (66%)
XLF: Financials (59%)
Value Sectors - shall outperform when the market is bearish:
XLV: Healthcare (55%)
XLC: Communications (49%)
XLE: Energy (44%)
XLU: Utilities (35%)
XLP: Cons. Staples (30%)
XLRE: Real Estate (16%)
Analysis:
With a market moving at this speed is difficult to decide in which moment of the cycle we are. We know that the economy is improving from lower levels, so we could consider it “Early Recovery”. The market, after the noise brought by the Iran war, is signalling towards a Bull Market as we shall see Technology and Industrials leading.
Sectors Performance
The market bullish momentum is expanding as we can see in the 1 week performance and even in the 1 month, as technology is not the top performer (despite being the heaviest by market cap., hence driving the S&P and the Nasdaq along with it).
Sectors Bullish Percent Index
Growth Sectors:
Value Sectors:
Any sectors below their red levels are good opportunities to find great companies at good valuations or buy sector ETFs (buy cheap). Those sectors above their Green levels are candidates to be sold (sell expensive).
Current Situation: Bullish & Future Outlook: Bullish:
C. Disc., Industrials, Financials, Communications, C.Staples, Real Estate
Current Situation: Bullish & Future Outlook: Bearish:
Healthcare, Energy
Current Situation: Bearish & Future Outlook: Bullish:
Materials, Technology, Utilities
Current Situation: Bearish & Future Outlook: Bearish:
None
SPX has a Bullish Current Situation and a Bullish Future Outlook.
Level 3: Where is it happening? Summary
Bulls vs. Bears: Bearish-to-Neutral/Bullish
Market & Economy Rotation: Bull Market
All Levels Summary and Final Thoughts
Level 1 Summary - The Why
Economic Data (long-term): Bullish/Bullish
Interest Rates: Bearish/Neutral
Investors Sentiment: Bullish/Bullish
Level 2 Summary - The What
Price Action: Bullish/Bearish
Breadth & Volatility: Bullish/Bullish
Options: Bullish/Bearish
Level 3 Summary - The Where
Bulls vs. Bears: Bearish-to-Neutral/Bullish
Market & Economy Rotation: Bull Market
Level 4: Scanning for opportunities
Great Companies with Great Technicals
Descriptive
Index: Any | Market Cap.: +Mid (+$2B) | Option/Short: Yes/Yes
Avg. Volume: >1M | Relative Vol.: Over 1 | Price: >$10
Fundamental
EPS Growth Next Year: >15% | EPS Growth Past 3 Years: >5% | Sales Growth Past 3 Years: >5%
- Sorted by P/E
Technical
Performance: Quarter Up | Price above 20D SMA & 50D SMA | Beta: >1 | ATR: > 1
None
S&P500 and Nasdaq New Highs
Descriptive
Index: S&P 500 and Nasdaq | Market Cap.: +Mid (+$2B) | Option/Short: Yes/Yes
Avg. Volume: >1M | Price: >$10
(order by Market Cap desc.)
Technical
50-Day New High
Highlights: C, CVS, MAR, SPG, NUE, STT, STLD, IBKR
Looking at these stocks, it seems to me that Steel is really trending higher. Guess, what requires a lot of steel? Yes, data centers and… Space X!
Disclaimer: The content on AMAT Investing is strictly for educational and learning purposes. The author is not a licensed financial advisor and holds no formal financial education. This post does not constitute professional financial advice. All investing involves risk of loss. Always conduct your own research and consult a licensed professional before making any investment decisions.
