THE BIG IDEA
If you only looked at the main market indexes, you might think that nothing much has been happening in the stock market. In reality, it has been pretty wild out there.
Let’s start with four of the biggest, most important companies on the stock exchange. The charts go back six weeks but check out those last two days!
What they all have in common is they are pouring billions, many billions, into AI. In their quarterly earnings report last week, Google revealed that for the first time EVER they spent more cash than they brought in. All four of them were down 6% or more for the week.
You would think that would be a bad thing.
The next pair of charts says not so fast!
On the left is the Invesco “high beta” ETF and on the right is their “low volatility” ETF. The one on the left holds all your favorite high tech stocks. The other is full of boring stocks that you surely don’t actively trade and is at an all-time high closing price.
Money has been fleeing the sexy stocks and finding a home in other places.
Well that’s nice, but what happens next?
Everyone is free to take a guess. If you look around the internet, it seems that everyone is doing so. TBH, there is not much evidence that the current trend is about to turn around. Yet we are at a point where a reversal of the trend could happen.
Here’s what The Prime Wave has on its mind:
The trend is your friend.
For cryin’ out loud, don’t buy a stock right before earnings. Some notable companies will be reporting this week. Yeah, you might get lucky, but it will be painful if you are not.
Tech stocks have not reached flat-out capitulation levels but are washed-out enough that a bounce could come sooner rather than later.
The professional fund managers have reduced their market exposure to normal levels from previous all-in mode.
The Swingex Index is the most bullish it has been since March 31st.
Putting it all together, good prospects could turn up. Be patient! Wait for them to come.
And don’t go too crazy, like the guy in this week’s Seen On The Internets….
SEEN ON THE INTERNETS
Aerospace was briefly a hot part of the market a couple months ago. Those stocks have had trouble finding a bottom since then. If/When they do, it will be too late for at least one person.
A post on social media by Jacob Keeton on Friday quickly went viral.
The Prime Wave could not find any companies in the Aerospace industry that recently went bankrupt. The only way to get completely “wiped out” would be from using leverage or leveraged products (options). It’s a sign of the times.
Many people end up in the same situation every day and they often blame a mysterious group of “manipulators” for their demise. Full credit to Keeton for recognizing that his downfall was due to his own recklessness.
And BTW, he now describes himself as a “Former Investor” in his profile.
NUMBERS ONLY
$90.47 | West Texas Intermediate crude oil closed the week at $90.47 on the NY Mercantile Exchange. That’s up from $69.50 at the end of last month. |
5 | Plenty of unsightly losses in the market recently, yet only 5 of the S&P 500 stocks hit a 52-week low on Friday. |
- 15.28% | The Dow Jones Automobiles Index crashed by more than 15% last week. Harley Davidson and Ferrari were losers along with Tesla. |
SWINGEX INDEX
As of market close on: 24 July 2026
Swingy says: People are getting nervous! Maybe they'll get nervouser! Look for buying opportunities.
Learn more about how the Swingex Index works here.
WATCHER
Stocks highlighted here each week are not recommendations to buy or sell. They are provided as ideas for swing traders to follow up on with their own research.
THRM (Gentherm): Gentherm is involved in “heating, cooling, and ventilation systems” for cars and people. The company is worth about $1.3 billion but unknown to many.
In the recent past, THRM had been basing around $30 before taking a step up to another base in the mid-$30s. What surely has your attention is those last two candles on the chart.
Last week, the company delivered a strong earnings report and also raised their forecast for the remainder of this year. That was enough to send the shares up 26% on Thursday, though they gave back 6% on Friday.
It is possible that there is some additional profit-taking in the immediate future. Given recent developments, buyers are likely to step in and take those shares, and we may want to be among them.