{"id":51644,"date":"2025-08-07T08:57:10","date_gmt":"2025-08-07T08:57:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/51644\/"},"modified":"2025-08-07T08:57:10","modified_gmt":"2025-08-07T08:57:10","slug":"seasonal-weakness-and-institutional-rebalancing-add-pressure-to-markets","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/51644\/","title":{"rendered":"Seasonal Weakness and Institutional Rebalancing Add Pressure to Markets"},"content":{"rendered":"

August is a tough month to trade.<\/p>\n

There has been seasonal weakness over the past 35 years.<\/p>\n

Liquidity is diminished and the volume is thin.<\/p>\n

Volatility can rise.<\/p>\n

Tax loss selling and rebalancing often occurs among institutions ahead of the end of the 3rd quarter.<\/p>\n

Earnings momentum and fading optimism can taper off in August. <\/p>\n

Maggie Lake and I covered a lot as always, and the video is available below.<\/p>\n

Here are some of the notes I sent her ahead of time.<\/p>\n

Yields topped as predicted and now, we could see further drop-looking at basing but fun starts over 90. The failed 100 if breaks 98 new leg down over 100 could see 103<\/p>\n

Below is a chart of TLT. It represents everything I covered with Maggie and in other Dailys. \"TLT-Daily<\/p>\n

TLT, after an auction today, sold off. However, the chart is clear. The rally Tuesday was to the July 6-month calendar range high (I talk a lot about that). <\/p>\n

The continues to outperform for now which shows risk on.<\/p>\n

The Real Motion Indicator had a mean reversion sell signal right at the calendar range high. <\/p>\n

HOWEVER, the dots are above the moving averages while the price is above the 50-DMA and below the 200-DMA. A bullish divergence.<\/p>\n

What I discussed with Maggie is the possibility that yields drop further, TLT clears the resistance and SPY, can continue to run as well, but watch for the performance to shift. \"DXY-Monthly<\/p>\n

This is the monthly chart of the dollar.<\/p>\n

The rally back up to the 80-month moving average (100) was a perfect technical bounce into longer-term resistance.<\/p>\n

The dollar under 98 will look more like a failure and reason to believe it will head even lower.<\/p>\n

This is bullish for commodities and Maggie and I cover a lot about energy and the various raw materials related to energy. <\/p>\n

Has bottomed?<\/p>\n

Very possibly.<\/p>\n

Maggie and I also discussed and how it looks great over 3350 and over 3450 we could see new all-time highs. <\/p>\n

, 38.50 is the point to clear and then 40 is the\u202fbreakout. \"Gold<\/p>\n

This is the October contract of gold. <\/p>\n

I have heard a lot of bears out there.<\/p>\n

I do not see any bearish case in this chart.<\/p>\n

The 3 charts I include in the Daily should help you determine risk and the next direction of the market.<\/p>\n

A weakening dollar, lower yields and rising gold prices are generally risk-off.<\/p>\n

Should gold sell off, yields remain flat, and the dollar runs up, the market may hold, so that is when you refer to the July 6-month calendar ranges.<\/p>\n

What is breaking out, down or stuck in a range.<\/p>\n

ETF Summary\u202f<\/p>\n

(Pivotal means short-term bullish above that level and bearish below)\u202f<\/p>\n

The divergence between growth and value continues to widen<\/p>\n

S&P 500 (SPY) 628 pivotal <\/p>\n

Russell 2000 (IWM) 215 July low to hold 222 close resistance<\/p>\n

Dow (DIA) 440 must hold now <\/p>\n

Nasdaq (QQQ) 562 key pivotal area<\/p>\n

Regional banks (KRE) 59 the July low and very pivotal <\/p>\n

Semiconductors (SMH) 280 support and 293 the place to clear <\/p>\n

Transportation (IYT) 68 area must hold<\/p>\n

Biotechnology (IBB) 133 failed-now the point to clear<\/p>\n

Retail (XRT) 81.70 the July calendar range high to clear<\/p>\n

Bitcoin (BTCUSD) 116 to clear 111 support<\/p>\n

Educational purposes only, not official trading advice.\u202f <\/p>\n","protected":false},"excerpt":{"rendered":"August is a tough month to trade. There has been seasonal weakness over the past 35 years. Liquidity…\n","protected":false},"author":2,"featured_media":25487,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[45,49,48,100],"class_list":["post-51644","post","type-post","status-publish","format-standard","has-post-thumbnail","category-markets","tag-business","tag-ca","tag-canada","tag-markets"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/51644","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=51644"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/51644\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/25487"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=51644"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=51644"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=51644"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}