After a shaky start to the trading day the NASDAQ was able to find buyers within its large cap technology stocks pushing it higher closing at all-time highs. The NASDAQ 100 has been impressive with the likes of FB, AMZN, and GOOGL. Biotechs remain hot as IBB has made new yearly highs. The Dow and S&P 500 were unable to close with gains, but both indexes remain in their uptrends. Small caps were able to close out the day with gains. Volume on the exchanges were lower, but not surprising given it is summer and a Monday. Not a bad way to begin the week, but a bit more consolidation would have been preferred for the NASDAQ. Earnings will be the most active for this week and is a remainder to always know when your stocks report.
GOOGL kicked off the after-hours session with better than expected earnings. Unfortunately, at this time (4:30pmEDT) the market is not cheering GOOGL’s results. The stock, if it continues to trade at these levels will apply pressure to the NASDAQ tomorrow. AAPL reports next week while FB is this Wednesday following the Federal Reserve statement from their most recent meeting. Wednesday should be a fun day for the market. AMZN will report this Thursday. The best way to handle this market is to have proper position sizes as well as a proper exit strategy. Most can never figure out both, but it is vital to make sure you have proper position sizes along with stops and profit taking signals.
A key point to remember is we are in a seasonally weak period. July can be a tough month for stocks. However, the next few months can be treacherous. August, September, and October are notoriously bad for the market. It does not guarantee we have a large correction, but it does highlight the need to be somewhat cautious. It is why we always talk about having proper position sizes and exits. It is the only way to protect you in the market. We guess you could run off into the mountains and hide in a cave. However, for those not running it is wise to maintain disciplined and avoid trying to be a hero. So many will take on large positions, not sell, and worse guess where the market will head next.
This will prove to be a busy week with earnings and the Fed. It is best you review your stocks and watch them closely. No need to overthink trades, but stay disciplined in your approach. Best of luck to your trading.
