Good morning, tradersā¦
Some funny things start to happen when the major indexes near all-time highs.
Resistance feels harder to break, price action has trouble extending, and traders get nervous.
I know the feeling. In early April, when the market started rebouncing after its brutal March selloff, there was no hesitancyā¦
Traders were champing at the bit to buy stocks at lower prices.
But that moment has come and gone. The reversal to the upside has been swift, with the SPY recovering nearly 25% in just over two months:
Now, the sentiment is noticeably different. No one loves to buy stocks near all-time highs, and you can feel that in the price action.
Traders are wondering whether the highs will hold (leading to a rejection) or break (leading to new all-time highs and price discovery).
The SPY chart isnāt going to answer this question for you. We have to get more specificā¦
Here Are 13 Stocks Iām Watching This Weekā¦
What We Learned from the May CPI Report
Yesterday, we got the May Consumer Price Index (CPI) numbers:
- CPI rose just 0.1% month-over-month. Following April’s 0.2%, this was a bit cooler than economistsā expectations
- The year-over-year increase was 2.4%. Up slightly from April’s 2.3%, but still below the 2.5% forecast.
- Core CPI (exāfood and energy) also rose just 0.1% MoM. Well under the expected 0.3%, keeping annual core inflation at 2.8%
The SPDR S&P 500 ETF Trust (NYSEARCA: SPY) shot up quickly following the print, but then started pulling back. It wasnāt a massive surprise or some kind of game-changing catalyst, but it was enough to push us into key resistance levels right near the open.
SPY is trading above $600 and inching closer to its previous all-time high of $613.
Thatās a key level to keep an eye on. If we push through, weāre in blue-sky breakout territory, which should lead to more momentum.
But if we stall there, thatāll be a sign that thereās not enough strength to break resistance ā¦ yet.
Either way, watch SPY closely above $600. This area is crucial.
13 Trade Ideas for This Week and Next
As the major indexes inch closer to the highs, some intriguing setups are forming in individual namesā¦
Intel Corporation (NASDAQ: INTC)
On Tuesday, Intel Corporation (NASDAQ: INTC) broke out of a large daily downtrend with strength, powered by some solid order flow. The volume was heavy around the breakout zone.
But by Wednesday, the stock had given back nearly all of those gains, down almost 6%…
It was a textbook false breakout. The volume told part of the story, but not enough people believed in it, and the bears took control quickly.
This is a good reminder that not all breakouts are created equal. One way to improve your odds is to focus on breakouts in higher-sentiment names.
A move in something like Robinhood or Palantir tends to hold up better than a breakout in a weaker, more uncertain name like Intel.
Now, the question is: Will the stock bounce off this pullback, or continue getting rejected? Iām still watching it to answer this.
Nike Inc. (NYSE: NKE)
Nike Inc. (NYSE: NKE) also had a clean breakout with strong early action and a solid volume profile range to the upside. If the momentum sticks, this one could continue higher. The technical setup is tight and clear.
PayPal Holdings Inc. (NASDAQ: PYPL)
The same goes for PayPal Holdings Inc. (NASDAQ: PYPL), which also made a short-term breakout. The daily chart shows room into the high $70s, and the recent volume confirms that bulls are stepping in.
Uber Technologies Inc. (NYSE: UBER)
Uber Technologies Inc. (NYSE: UBER) is also setting up well after bouncing off its 21-day exponential moving average (EMA). Price action looks clean, and it’s reacting well to technical support.
This oneās looking good for intraday setups, and like many of the names above, it’s offering traders a chance to lean into strength while keeping risk defined.
Mail Stocks Are āDeliveringā the Goods
Meanwhile, mail stocks are sending us a clear message. Both FedEx Corporation (NYSE: FDX) and United Parcel Service Inc. (NYSE: UPS) had strong breakouts recently.
FDX stood out even more thanks to a wave of July 18 $260 call buying. That strike is pretty far out of the money, but it also has plenty of time.
We got a pullback on Wednesday, which could be the ideal entry for a swing setup. I wouldāve rather seen this build a strong base, but Iāll be watching both names on Thursday and Friday for a potential reclaim of the breakout.
7 Honorable Mentions
Perrigo Company plc (NYSE: PRGO) got a weird surge of unusual order flow. The stock broke out of a long-standing downtrend and showed high volume at important levels. This isnāt a name that shows up on my scanner often, which makes it even more intriguing.
Tesla Inc. (NASDAQ: TSLA) also bounced hard after a wave of long-dated calls came through. That whole Musk-Trump feud is already fading, and the stock is responding with strength.
Core Scientific Inc. (NASDAQ: CORZ) continues to ride a momentum wave. If it clears $13, thereās a wide-open gap above. Buyers keep stepping in on dips, and this one is turning into one of the strongest trends out there right now.
Meanwhile, growth stock favorites like SoFi Technologies Inc. (NASDAQ: SOFI), Palantir Technologies Inc. (NYSE: PLTR), and Robinhood Markets Inc. (NASDAQ: HOOD) are all acting like magnets for day traders.
These names continue to show strong dip buying behavior and are a big part of the rotation in this current market.
Theyāre volatile, theyāre liquid, and theyāre moving. As long as that momentum holds, theyāll keep drawing attention.
The market looks strong for now. But as we near all-time highs on the major indexes, itās time to get more selective, more discerning, and more specific.
And thatās exactly what these names are for.
Happy trading,
Ben Sturgill
P.S. You donāt need a fancy setup.
You donāt need a bunch of āalgosā and āindicators.ā
You donāt need to spend all day watching charts.
And you donāt need a lot of money.
All you need is a working phone, internet connection, and a trading accountā¦
And you could begin targeting gains up to 20%… 39%… 100%… 148%… 200%… and even 300%…*
*Past performance does not indicate future results
