The S&P 500 ($INX) extended its major (long-term) uptrend to a high of 7,620.90 before settling June at 7,499.36, down 1.1% for the month. This completed a bearish spike reversal telling us the major trend has turned down. Theoretical Positions: Investors likely bought back into the Index durning April. Investors could look at decreasing their positions near the June settlement.
The Dow Jones Industrial Average ($DOWI) extended its major uptrend to a high of 52,655.66 during June before settling at 52,319.20, up 2.5% for the month. Theoretical Positions: Investors are likely long blue chip stocks, but keeping an eye out for a potential bearish technical reversal pattern.
The Nasdaq ($NASX) extended its major uptrend to a high of 27,190.21 before closing June at 26,213.72, down 2.8% for the month. This completed a bearish spike reversal pattern indicating the major trend has turned down. Theoretical Positions: Investors could look at decreasing their positions in high-tech stocks near the June settlement.
The US 10-year T-note (ZN): I am still not getting a good read on the major trend of the 10-year T-note. After posting what looked to be a bullish breakout during February, the market completed a bearish outside month during March before consolidating during April and extending its selloff through June. If the Treasury sector is starting to build in a rate hike as the next move by the FOMC, as indicated by the uptrend of the US dollar index and Fed fund futures forward curve (see below), the 10-year futures market would be expected to extend its selloff. Theoretical Positions: Investors may have gone short the 10-year near the March close of 111-015 based on that month’s bearish outside range. The 10-year closed June at 109-285 after posting a low of 109-020.
The Fed Fund Futures Forward Curve shows the market is pricing in a possible rate hike at the end of the September 2026 US Federal Open Market Committee meeting (September 15). The September 2026 futures contract closed May at 96.225, putting the expected rate at 3.775, above the high end of the existing range between 3.5% and 3.75%. This fits with the major uptrend of the US dollar index as interest rates are the key fundamental for the underlying currency.
