The XJO is expected to open practically flat this morning despite a renewed rally in the U.S which saw their market close firmly in fresh all-time highs. Their futures are flat.
Yesterday our market had a late afternoon rally, retesting all-time high resistance at roughly 8,600. Even though we actually closed the highest our market has ever closed (by a handful of points), we are still holding the top of the channel that represents our recent consolidation range. Indeed, it seems reasonable to suggest we rebounded off it slightly intraday yesterday.
This morning, we should open around 8,600 and retest the top of the channel. Considering the U.S made fresh highs last night, perhaps we will move through at some point today, especially if U.S futures push into the green.
If we indeed make fresh all-time highs, keep in mind that our market typically will sell down either the next day, or after a handful of days of consolidation. It is rare for our market to make consecutive fresh all-time highs. Considering the current environment and the hesitation our market has been showing over the past week or so, we should expect the same this time around.
US Market
US shares closed mixed again overnight with the SP500 and NASDAQ closing higher, while the DOW JONES closed slightly lower. US shares started the session fairly weak, but steadily gained throughout the session. US shares rose despite an unexpected drop in jobs created in June, which was expected to show a reasonable amount of jobs growth. Perhaps investors are feeling this could lead to further interest rate cuts. The next major event for US markets will be full US unemployment data, which will be released tonight. The US economy is definitely slowing and the market is hoping for interest rate cuts, but at the same time, inflation is remaining elevated and that could cause the FED to wait on the rate cuts. US markets will only trade for half a session tonight due to the Independence Day holiday.
Seven of the eleven sector groups of the SP500 closed higher overnight, with Energy, Materials, and Technology the best performers. Healthcare, Utilities, and Financials saw the most selling.
Technically, the SP500 has recently pushed through the previous all time high resistance at 6,150. With this level breaking, we would expect further upside, though prices are elevated and gains may be smaller from here. 6,150 is now the potential support to watch to the downside.
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