Do you want to know which ETFs are hot and which ones are not? Then you need my High-Volume ETF Cutline report. It tells you how close or far each of the 311 ETFs I follow is from its long-term trend line (39-week SMA). These are the ETFs that trade more than $5 million a day, so they are not some obscure funds that nobody cares about.
The report is split into two parts: The winners that are above their trend line (%M/A), and the losers that are below it. The yellow line is the line of shame that separates them. You can see how many ETFs are in each group and how they have changed since the last report (235 vs. 256 current).
CRYPTO GOES MAINSTREAM AS BITCOIN HOLDS STEADY IN QUIET SESSION
[Chart courtesy of MarketWatch.com]
Moving the market
The S&P 500 fired out of the gate, hitting a fresh record right after the opening bell—only to lose steam almost immediately. The major indexes slipped into the red not long after and spent the rest of the day glued to their flat lines, wrapping up in a pretty bland fashion.
On the bright side, some of the big tech names—Nvidia, Tesla, Alphabet, and Amazon—logged early gains. Over in earnings land, both Pepsi and United Airlines kept their rallies going after dropping numbers that topped Wall Street’s expectations.
Right now, plenty of traders are in “risk on” mode, with the hope that a Fed rate cut might be around the corner. Here’s the twist: historically, strong bull markets actually do better without rate cuts. In fact, the very first rate cut can sometimes signal a top, not a new rally. Still, with inflation cooling off and GDP forecasts holding up, maybe this time will buck the trend.
After a sluggish start to July, so-called “soft” data (like sentiment and expectations) is catching up to the more concrete “hard” numbers, fueling optimism. The Citi Economic Surprise Index even points to things picking up, even though today’s action on Wall Street was mostly sideways.
For the week, the Mag7 stocks easily outpaced the rest of the S&P 500, helped along by a relentless squeeze in the most shorted names. Bond yields were all over the place, the dollar ended stronger, and gold managed a move higher.
Bitcoin, meanwhile, took a nap after Monday’s surge and ended the week unchanged.
It’s worth pointing out that even the trading community is catching on: crypto isn’t just a fringe asset anymore—it’s quickly becoming a staple for mainstream investors.
Out of the 1,800+ ETFs out there, I only pick the ones that trade over $5 million per day (HV ETFs), so you don’t get stuck with a lemon that nobody wants to buy or sell.
Trend Tracking Indexes (TTIs)
These are the main indicators that tell you when to buy or sell Domestic and International ETFs (section 1 and 2). They do that by comparing their position to their long-term M/A (Moving Average). If they cross above, and stay there, it’s a green light to buy. If they fall below, and keep going, it’s a red light to sell. And to make sure you don’t lose your shirt if things go south, I also use a 12% trailing stop loss on all positions in these categories.
All other investment areas don’t have a TTI and should be traded based on the position of each ETF relative to its own trend line (%M/A). That’s why I call them “Selective Buy.” In other words, if an ETF goes above its own trend line, you can buy it. But don’t forget to use a trailing sell stop of 12%, or less if you’re feeling nervous.
If some of these words sound like Greek to you, please check out the Glossary of Terms and new subscriber information in section 9.
DOMESTIC EQUITY ETFs: BUY— effective 5/20/2025
Click on chart to enlarge
This is our main compass, the Domestic Trend Tracking Index (TTI-green line in the above chart). It has broken above its long-term trend line (red) by +4.73% and remains in “Buy” mode, with our new holdings being subject to our trailing sell stops.
The stock market kicked off today with a dose of optimism, backed by fresh economic data and a string of positive earnings announcements.
Traders were clearly in a good mood, as about 88% of the 50 S&P 500 companies that reported this week managed to top expectations, giving confidence another solid boost.
On the economic front, jobless claims for the week ending July 12 dropped by 7,000 to 221,000—not an earth-shattering move, but it’s the right direction.
Even better, June retail sales jumped 0.6% from May, blowing past the 0.2% forecast. That strong retail report helped push markets higher throughout the day, with the S&P 500 and Nasdaq both setting new records, and small caps leading the charge.
The action wasn’t just about stocks. The most shorted names added extra rocket fuel to the rally, even as bond yields kept to a tight range.
Meanwhile, after yesterday’s dip, the dollar rebounded and clawed back some of its losses. Gold had a wild ride overnight—dropping hard but then finding its feet around the $3,330 mark before ending the day lower.
Bitcoin wasn’t left out of the drama either, taking a tumble before bouncing back to about $120,000.
It’s clear that equities had a strong session, but in the background, everyone’s wondering the same thing: With the economy overall showing mixed signals, when will Fed Chair Powell finally budge and cut rates?
That’s the big unknown keeping traders on their toes.
The markets started the day in neutral, with the major indexes barely budging as traders waited on earnings from the big banks and tried to make sense of the latest inflation data.
Bank of America, Goldman Sachs, and Morgan Stanley all beat expectations, but their stock reactions were all over the place—some up, some down.
Meanwhile, June’s Producer Price Index (PPI), which gives us a sneak peek at inflation trends, came in flat. That’s a surprise, especially since many were bracing for a bump thanks to tariffs. So far, no sign of “tariff-flation.”
On the economic front, Industrial Production came in hotter than expected—up 0.3% month-over-month, which adds up to a 0.73% gain year-over-year. That’s a solid beat.
Despite the good news, markets didn’t seem too impressed. Investors were more focused on whether the Fed might have room to cut rates later this year.
The day wasn’t without drama. Stocks briefly tanked after reports from CBS and the New York Times claimed Trump was planning to fire Fed Chair Powell—rumors that were quickly denied.
The S&P 500 got off to a hot start, thanks to a 6.5% surge in Nvidia, which pushed the index to a fresh record above 6,300. But that early momentum didn’t last—by the end of the day, the S&P had slipped into the red.
The big event of the day was the June CPI report. Inflation rose 0.3% for the month, putting the annual rate at 2.7%. That’s exactly what economists expected. Core CPI (which strips out energy) came in at 2.9% year-over-year—again, right on target. But here’s the catch: both numbers were up from May, and that uptick was enough to spook traders.
So, while the data didn’t surprise on paper, the market didn’t love the direction it was heading. The Nasdaq managed to hang onto some gains, but the rest of the market faded fast.
Bank earnings were a mixed bag, and while investors are still hopeful that Q2 results will give the market a lift, today’s action didn’t offer much encouragement.
Rate cut hopes took a hit too. Tariff data showed price increases in categories like furniture, apparel, and auto parts—fueling concerns that inflation might stick around longer than expected.
Tech stocks, especially the “Magnificent 7,” were the stars of the day. But outside of that group, the broader market got smacked around. An early short squeeze fizzled out, and with it, any bullish vibes.
The U.S. dollar had a strong day, rising 0.56% as bond yields jumped. That put pressure on gold, which dipped but found some footing at its 50-day moving average.
Bitcoin also took a breather after hitting new highs yesterday. The drop came as the House failed to pass a procedural vote on three crypto bills expected this week.
And then there’s Nvidia—again. The chip giant soared over 6% on news of strong China sales, pushing its market cap past $4.2 trillion. Not bad for a day’s work.
So, the big question is: with markets near all-time highs and inflation still lurking, how much more upside is left?
