What Lies Ahead For Summer As Market Climbs?

2021-06-22

Was the sell-off last week a knee-jerk reaction by panicky traders?

Stock market indexes are again grinding toward all-time highs despite continued trader sensitivity to the Fed and another round of “what lies ahead” testimony on Capitol Hill.

As the dust settles from Fed declarations and speculation, sellers appear remorseful for reacting so sharply last week. All major indexes spiked to start this week and all closed positive today.

As Simpler’s traders discuss daily in the training chat rooms, this market is fickle, fiery, and fueled by emotions that too often overreact to news or market sentiment. The continued volatility and uncertainty appears to have limited the scope of opportunity in the short term, but the long term still presents potential.

Simpler’s traders don’t see this market as crumbling, just stumbling along with less strength in directional commitment as expected.

They are looking ahead to the next two to four weeks, and expect the market to be sensitive to anything from the Fed or sudden news. The plan is to remain nimble and expect plenty of volatility in an environment where chart patterns may be more difficult to recognize and act upon.

As summer rolls on, Simpler’s traders don’t want to worry about what happens “next” or what happens session after session. The focus is on what the market is presenting… right now. This opens opportunities to day trade and work off shorter time frames.

Time, price, volatility, and volume are key signals to watch as summer heats up. Our team is targeting short-term opportunities and calling it a day.

Doesn’t it make sense to focus on what’s happening today and not sit around worrying about tomorrow? That opening bell will ring again soon enough.

We Saw: Market continue higher despite “nervous sensitivity” —

  • Fed believes inflations will simply “transition” away
  • Nasdaq not concerned as it closes at new high
  • Cryptocurrency cooling further as summer heats up?

We’re Watching: Sectors with strength and rising potential —

  • Moves in the S&P 500
  • Stronger sectors such as healthcare, energy
  • Slim on setups: GOOGL, AMZN