Monday Takeaways: All Is Not Quiet on Wall Street

Shah Gilani|July 1, 2024

A four-day trading week doesn’t always mean smooth sailing.

Wall Street’s top players heading to places like the Hamptons… leaving their B teams in charge.

Will they take advantage?

As we enter the second half of the year… there’s some rumblings under the S&P 500’s surface. Yes, we’re in a bull market… but it’s certainly not a raging one. This one metric shows us why.

Plus… what’s going on with Tesla? If you’ve been following along… you know I have no love for the stock. But this week could be an interesting one for the company.

Click on the thumbnail below to get your biggest takeaways for this July Fourth week.

Note: My “Undefeated Stock” for July will be released this afternoon! Click here to learn how to get your hands on it… and all of my undefeated stocks for every month of the year. Details here.

Transcript

Hi, everybody. Shah Gilani coming to you from the new and improved LaGuardia Airport. Yes, I am waiting for another plane. Hope you’re all doing well.

It’s going to be a short week. That’s our first takeaway for this Monday. It’s going to be a short week.

During short weeks on Wall Street, especially when we have Thursday off and we’re back open on Friday, a lot of nothing happens… but sometimes stuff happens on Friday.

Why? Because trading is thin. Most of the real players are away, probably in the Hamptons, and they have the B team running the desks. They’ll try to move stocks sometimes because, you know, they can.

This Friday is going to be interesting because we get unemployment data. Maybe it will move the market.

Again, though, I don’t think we’re going see a whole lot happening this week. I hope it’s a calm week. It’ll give us a chance to rebuild our stocks and get back out next week for a full week.

The takeaway from last week is we had pretty much a nothing burger at the end of the week. Even though a bunch of stocks – I’m talking about the Magnificent Seven – hit some new highs, it was a pretty uneventful Friday.

And as far as the week goes, pretty much nothing.

The real takeaway from that was underneath the surface.

Underneath, the equal-weighted S&P is grossly underperforming, which means there’s less breadth every day.

So while we’re seeing new highs in the Qs and the S&P 500, we’re not seeing the kind of participation you want to see in a raging bull market. So we’re in a bull market, but it’s not exactly raging. The breadth is getting worse and worse. That’s not good.

So the takeaway is to watch the equal-weighted S&P and see how that does. If it starts to pick up, starts to catch up a little bit, then that means we’re broadening out and the rally can continue. Right now, it’s very dicey.

But some of the stocks that have moved the market look really good. They look steady and strong. A couple of them look like they’re just flatlining.

Tesla, for example, wow. What a comeback it’s made. It looks like it wants to get above $200, then go higher.

But guess what? The 200-day for Tesla is $206. It has to get well above that for me to be confident Tesla has made any kind of turnaround. They report vehicle sales this week, so that’s going to be an interesting number.

The takeaway for this week is, based on last week, I don’t expect a whole lot because we were flat pretty much at the end of last week.

The internals were good for the good stocks. For the rest of the market, the return internals were pretty boring, if not disappointing.

So it going to be an interesting week because, hopefully, it’ll be uninteresting… and that’ll make it a good week. And we can just carry on next week.

But I’m always a little concerned on weeks that are interrupted by holiday.

What happens on a Friday? The market’s going be open only briefly because people are going be leaving. Other traders are going to try to move stuff in the morning when we get the 8:30 unemployment numbers. So that’s it.

The takeaway this week is sit tight when you can. If you have to do something, do something. But try to sit tight because it’s going be – I hope and you hope – a boring week.

Catch you guys next week. Cheers.