EB Daily Market Report - Friday, July 21, 2023

Dear Members.

This will be a brief update with Tom back with his regular DMR on Monday.

The Dow is now green for its 10th straight day, something we haven't seen since 2017. It's also extremely overbought which doesn't seem to matter at the moment but it's worth noting that the last time it got so stretched was August of last year, just before a major correction took place and leading to the October lows. This doesn't mean we'll see a repeat but to me it's flashing a big warning sign.

The S&P and NASDAQ are higher as well with plenty of volatility as we head into the close of options expiration Friday.

Next week won't be dull as earnings season kicks into high gear. So far we've seen a mixed picture, or at least mixed reactions to those companies that have already reported, which I imagine we will continue to see next week as hundreds of companies receal their numbers.

We're also going to hear from the Fed next week with the expectation of an additional rate increase. So I'm not expecting any rate surprise though we'll have to wait and see how the market reacts to the post rate discussions by Jay Powell.

We know the level the S&P will need to clear for the bulls to take it higher was set this week at 4557 on the S&P. To the downside there should be price support at 4500 with key technical support at the 20 day moving average, currently at 4328.

That's it for today and I want to wish everyone a restful weekend!

At your service,

John Hopkins