EB Daily Market Report - Thursday, July 2, 2026

Weekend Schedule

As a quick reminder, we are not updating ChartLists this week as there have been very few earnings reports. The only 2 earnings from this week that I plan to add to the Strong Earnings CL (SECL) next week are PRGS and MSM.

I want to wish everyone a safe and happy July 4th weekend!

Major Indices

The Dow Jones broke out of an inverse head & shoulders pattern back in August 2025. At that time, I indicated the initial measurement of that breakout was 53,000. Today, the Dow Jones hit a high of 52,805.12, moving very close to the 53,000 level. Here's what the pattern looked like nearly a year ago and where we stand today:

Note that the breakout at 45000 also created a major support level there as the selling in late March stopped exactly at that level.

Rotation

July has gotten off to a very rough start for semiconductors as the SOXX has plunged from 640 to 555 (at last check) in two days. That's taken the wind out of technology's (XLK, -3.71%) sails. The beneficiaries of this rotation have been primarily value stocks as the IWD has gained 1.5% during the technology/semiconductors/AI selloff.

If you're looking for support on many of these beaten-down tech stocks, I'd bypass the daily charts and pull up the weekly charts. Selling like this can take us down to rising 20-week EMA tests, which I believe will hold. There's still plenty of short-term downside left if those 20-week EMAs are to be tested.

We have continued to see some of this rotation benefit the Mag 7 stocks. NVDA, META, and TSLA have lost ground today, but the others have seen their fair share of money rotating INTO their stock.

June Jobs Report

It was released this morning and came in positive, but shy of expectations, similar to the ADP employment report yesterday. We've seen the 10-year treasury yield ($TNX) move higher with both reports, which is a little puzzling, but I currently view the TNX as being in a 4.37%-4.68% range. We're at 4.49% right now. I think the real story will be which way the current range breaks.

Sectors/Industries

Regional banks (KRE) have seen a significant rise off the March low, but today's candle is ominous as we could print a bearish engulfing candle off of an uptrend. That could mark a short-term top with the rising 20-day EMA as a potential upcoming test on any pullback:

Happy trading!

Tom