THE BIG IDEA
Let’s start this week’s Big Idea with a simple multiple-choice question:
The stock market is currently ________ .
A) Too volatile
B) Too quiet
C) Neither
D) All of the above
The answer is probably D. In recent days, we have seen two respected analysts zero in on seeing the market being too volatile and too quiet.
Jonathan Krinsky, Chief Market Technician at BTIG, shined a light on the day-to-day volatility in SOX, the benchmark semiconductor index. As of late last week, that index had gone up or down by at least 3% in 15 of the previous 30 trading days. This is something that had happened only twice before while the index was in a long-term uptrend. So it is historically high volatility in arguably the world’s most important industry.
Meanwhile, Tom McClellan was writing about the fact that the McClellan Oscillator is the quietest it has been in years. The 15-day range of his oscillator is now historically narrow, a symptom of complacent drift.
The funny thing is that both of them reached the same conclusions about what it means for the near future of the stock market.
Both analysts see what they see as bearish for the market.
Krinsky said that semiconductor stocks trending up with high volatility “was too early of a signal in ’99, (but) it had ominous outcomes in ’95, ’97, ’00, ‘20, and ’24 preceding -17% or worse drawdowns”.
McClellan said that the low movement of his oscillator “is consistent with a topping condition for prices”. He added that it does not always work out that way, however.
That they agree on the direction of semiconductor stocks and the stock market generally, does not mean that they will surely be proven right.
Personally, I would not bet against them.
SEEN ON THE INTERNETS
On Thursday, we spotted the chart copied below that was posted on social media by Rennie Yang.
The chart compares the advance-decline line of the high yield bond market (orange) with the S&P 500 (blue). Yang sees a “wedge”, or symmetrical triangle, on the high yield bond data. More importantly, it looks to be exiting the pattern to the lower side.
Yang calls it a “negative development for stocks if true”. Some might even call it bearish.
NUMBERS ONLY
$1 trillion | As of Friday, shares of SK Hynix of Korea are now listed in the US (ticker: SKHY). The company is valued at approximately $1 trillion. |
14.81% | Meta Platforms (a.k.a. Facebook) was up 14.81% last week as the market found out the company is doing something with AI. |
4 | With the S&P 500 less than 1% from an all-time high, it is no surprise that only 4 members made a 52-week low on Friday. |
SWINGEX INDEX
As of market close on: 10 July 2026
Swingy says: Something has the index spooked. Lay low for now and wait for a better situation.
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.
WERN (Werner Enterprises): Continuing our recent theme of steering clear of “tech”, this week we consider a company based in Omaha, Nebraska.
Werner Enterprises is in the trucking industry. Like many of their peers, their stock has done well overall YTD. We see a couple things to like on the charts.
First, where the Dow Jones trucking index (blue line in the upper panel) peaked in early June and dropped off, WERN has held strong. The relative strength in WERN is a solid plus.
Second, while the stock has been relatively strong it is not caught in a speculative frenzy. It has spent 4 weeks forming a base and seems to be trying to start the next leg of an uptrend.