The Weekly Trend
The Weekly Trend
Episode 255: Messy Summer?
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In this week's episode, David and Kevin discuss the areas of the market at or reaching important areas of supply, international areas of the market that are continuing to hold up well, weekly versus monthly candles, and the strength out of momentum.
Welcome back to the Weekly Trend Podcast. Today is Friday, May 30th, 2025 s and P 500, currently sitting at 58 70. I am David Darling, and I'm here with W Chacho, Kevin Ferrari. Great to have you back on here.
me_1_05-30-2025_124753Yeah, think it's been a while.
david_1_05-30-2025_124753It has been, I should have looked up before we pressed the record button the last time you were on, but maybe you could find some buyers for the market to keep it above a 200 day moving average.
me_1_05-30-2025_124753Yeah, I don't know if I know that many people and the ones I do know, I don't know if we could put the money together to really make that happen,
david_1_05-30-2025_124753Yeah, like could you be like a town crier and just go up and down the streets with a bell? I don't know.
me_1_05-30-2025_124753probably get the cops called. That's fine.
david_1_05-30-2025_124753Well, you don't have to do it at 1:00 AM.
me_1_05-30-2025_124753Hmm. That is true.
david_1_05-30-2025_124753You could. You could,
me_1_05-30-2025_124753Probably get the most people to respond to that
david_1_05-30-2025_124753but I suppose even, yeah, even at 1:00 PM little suspicious to have a guy walk up another street ringing a bell, asking for buyers. But yeah, not, I mean, not. Two different of a price level for the s and p 500 from last week's recording to now still above a 200 day moving average on the s and p 500, which is good.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753have some things getting into some interesting areas where you could see supply take controls. Is there anything that you're looking at that's kind of piqued your interest?
me_1_05-30-2025_124753Yeah, I mean, really there's a lot of things. I mean, I, I guess the one that kinda stands out the most to me is probably VEU, just because of how strong international's been lately over the last few months.
david_1_05-30-2025_124753Okay, so VEU, the All World Index subtracting out US stocks and. Are we sitting with that? Are we all time highs?
me_1_05-30-2025_124753Well, I guess that depends how you look at it.
david_1_05-30-2025_124753Okay, I'm listening.
me_1_05-30-2025_124753currently if you go off of like daily or weekly all time highs, not so much. I mean, it's, it's right there. I mean it, as kind of the minutes go by, you're kind of back and forth if you use the close, for like a monthly close. Still hard to say. I would think we're gonna get that all time closing high on the monthly today. knock on wood, you never know. They could trash it from here. But it really kind of depends what timeframe you're looking at, whether or not you really got it.
david_1_05-30-2025_124753Yeah, I mean, in May of 2021, the monthly close for VU was 64 21. We're currently sitting at 65 0 3,
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753and then you look back even further in time and we've got VU closed. October of oh seven at, what is this? This would be 63 49. So we're right there,
me_1_05-30-2025_124753there.
david_1_05-30-2025_124753and I hope our listeners, the first thing they think about is, wait a minute, that's almost like a 0% return since 2007, and you'd be correct, like it's about a 2% return. So you can't sit there and say, too far too fast for international all world stocks.
me_1_05-30-2025_124753by any means.
david_1_05-30-2025_124753If since 2007 you've gotten a 2% return and nothing but heartburn in between.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753But to your point, we're not clear out of there on a weekly or daily basis.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753think it brings up a good thought question. Do you have an opinion on this? Whether. Monthly. Monthly closes or weekly closes or I,'cause I think it's pretty fair. You and I would sit here and say that a weekly close is more important than a daily.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753Can we extrapolate out and say a monthly is more important than a weekly? Is it that easy? I.
me_1_05-30-2025_124753I feel like that's harder that I don't know. I mean, like once you get beyond weekly, right? Like with these monthly charts, I almost, I guess personally use'em as, I guess more so like I would have to use that with the weekly together. Yeah. I don't know if. Like some of these monthly charts really can rely on that timeframe by itself.
david_1_05-30-2025_124753I think that's fair because what's interesting about Weekly is the willingness to hold risk over two days without price action. Whereas monthly you might not have that. Now we today's the 30th of May, which just happens to be, there's not gonna be another day in May, and it's going right into a weekend. So we are gonna have two days of risk to hold stocks through. And I think that's really a nuanced thing to consider is that it's absolutely cool if something like BU closes a new all month, monthly, all time high,
me_1_05-30-2025_124753Mm-hmm. All right.
david_1_05-30-2025_124753I don't know why they, the gregorians or whatever, whoever invented this calendar, I know there's various ones out there, how they decided when months would end and how that works. But all I know is that there's months where the month end is on a Wednesday or Tuesday, and you're not carrying that two day risk like you would weekly.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753And using vu, your point is simply, yeah, there's a weekly or a monthly. Potential for new all time high, but when we look at June of 2021, we're right there like it. We may not close above that. That's at 65, 10, so it's close and there's a lot of things like that. It's not just vu. I know we foc, we're focusing on that, but you look at,
me_1_05-30-2025_124753There's a lot.
david_1_05-30-2025_124753but yeah.
me_1_05-30-2025_124753we were talking kind of fangs before.
david_1_05-30-2025_124753Yep.
me_1_05-30-2025_124753we were talking about that yesterday too, right around all time highs. Kind of pulling back from there a little bit industrials, XLI I think yesterday we were talking like uranium as part of like some of these areas in energy and industrials, know, kind of the same deal up at all time highs, kind of running into some resistance here so far. Even. Which I guess makes sense'cause we were talking eu, but a lot of, know, when you out international and look at like a lot of your individual country funds kind of starting to see the same thing. So there's quite a few areas of the market that are really kind of pausing up here, which makes sense. I mean, it definitely wouldn't say it's not natural, but it makes you wonder. Do we have what it takes to get through there or is this kind of foreshadowing that we're gonna kinda reign it back in here for a little bit and kind of digest some of this stuff.
david_1_05-30-2025_124753Yeah, I mean if, if we just use like the s and p as an example, this area between fifty eight hundred and sixty one hundred, I mean, that's price history that goes back into late summer of last year, early fall that anybody who bought there is now getting back to even. And that's a psychological barrier, right? Like I'm back to even, I'm out like just happy I got my money back. So now it's, is there enough demand to chew through those individuals who are sitting there just getting back to even. That's really what we have to wait and see for now is, whether it's BU or the SP 500 or fangs, or even a big stock like Nvidia, which is up against price levels that it's. High point of range that goes back to summer of 2024. It's an important psychological level. I mean, there's, there's gonna be sellers here. Now, can we chew through that? Can we like a sledgehammer? Can we keep pounding on that wall until we break through? Wish I could tell you Kevin, then.
me_1_05-30-2025_124753I know you just, you don't know until it happens, right?
david_1_05-30-2025_124753Great. I think the first step would be able to sustain trade above a 200 day moving average for a lot of these things while it's chewing through. But I could also see a scenario where there's aggressive selling in here and it takes us below a 200 day, and then we gotta regroup and confirm that the buyers from the April lows were there. I mean, markets do what they want. I wish, I wish I could tell a market what to do.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753I, I. I could see a consolidation here, but I could also see a scenario where we're going and seeing whether April was for real or maybe in two weeks. We're talking about fresh all time highs, which is the bullish, most bullish thing a market can do, and the sellers were not willing to sell. They're okay holding and we move higher,
me_1_05-30-2025_124753Mm, for sure.
david_1_05-30-2025_124753from a monthly candle perspective, since we're getting fresh ones. Any interesting ones? I know you mentioned Vu. That you're
me_1_05-30-2025_124753I mean, I think, well this one is kind a nice daily, weekly, monthly, but like aerospace and defense looks
david_1_05-30-2025_124753oh, yeah.
me_1_05-30-2025_124753but that's like a really solid monthly candle. I mean that it's pretty pristine looking and even last month's candle, which looks like most things, but that, I mean, just how well that area as a whole is held up. Is really nice. So I guess that's kind of cheating, I guess.'cause pretty much every way you look at aerospace and defense, no matter what your timeframe, it looks pretty good.
david_1_05-30-2025_124753Yeah. You look at something like ITA versus S and p breaking out of a five year base.
me_1_05-30-2025_124753Yep.
david_1_05-30-2025_124753And then I think even looking at the aerospace and defense gives us clues about international as well. Because you know you have your, its your PPAs, your X, these are ETF funds that probably are a little bit more US-centric. But then you have something like shield, SHLD, which is outperforming those and that's more internationally focused.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753I think you brought up before we got on here, some interesting points about airlines.
me_1_05-30-2025_124753Yeah. It's like what A IRL. It's like an airlines ETF that's tilted more towards international. Which if you compare that to something like Jets, know, which is kind of the inverse of that. more US centric, it looks quite a bit better. And I mean, I wouldn't say they'd as good now necessarily. Well actually, like global infrastructure using like a GII, I mean that's a pretty nice. Monthly candle there. And so, I mean, yeah, we're still seeing those things with like the international tilts. They're looking pretty good yet for the most part. So, and I would say, I mean, we talk v eu, but like even the relative to the s and p like that, if you look at that on a monthly, kinda using like that downward rate of trend from, we'll call it like, basically start a Q4 2010.
david_1_05-30-2025_124753Yep.
me_1_05-30-2025_124753That's kind of been continually tested right over the past 15 years and this month doesn't look like we're gonna get. A monthly close above there, kind of inter month we've kind of pushed the boundaries there and even last month as well, kind of closed right there. So, they're really kind of trying to break that relative downward rate of trend.
david_1_05-30-2025_124753Mean, it's been 15, 15. Years of a downward rate of trend, upper left to lower right. And you're right, we haven't broken that rate of trend trying to now, but you could see if this, this doesn't work here, rotation back to the us doesn't have to happen.
me_1_05-30-2025_124753Nope.
david_1_05-30-2025_124753And maybe this needs time to consolidate too. So it's, and if there's gonna be opportunity internationally, there's still plenty of time. It's not like the, the train has left the station. And you'll be late to international. I mean, we, we are talking about VU being in a 73% drawdown to as opportunity cost versus s and p for the last 15 years. So still plenty of opportunity
me_1_05-30-2025_124753Mm-hmm. But yeah,
david_1_05-30-2025_124753and.
me_1_05-30-2025_124753If you look at a lot of these individual country ETFs, though. I mean we've had some pretty aggressive moves to the upside to get to this point. I mean, it definitely would not seem to be like, it would seem constructive if we consolidate here and, digest some of this. There should be nice and I mean that does right? Because really for a lot of these areas it's pretty tough to of jump on that bandwagon.'cause once it took off, it pretty much took off.
david_1_05-30-2025_124753Right.
me_1_05-30-2025_124753I mean there were some areas in there where you kinda had time to get in, but you know, if you kind of missed that boat, we consolidate here, that could just provide more opportunity. To get into the upside later.
david_1_05-30-2025_124753Yep. A hundred percent and it's really hard to get bearish equities overall if, if something like Germany continues to make new all time highs,
me_1_05-30-2025_124753Yeah. Jeremy looks really good.
david_1_05-30-2025_124753Germany versus the US looks like it's trying to work, and break out of a base that goes back to 2021. Also in a downtrend since oh eight, but I mean pretty constructive, highly, highly correlated to US markets is the German Dax. So we'll see here if they can, if they can pull this off and on, on the flip side, that'd be one in the, in the positive category. On the flip side, you have broad-based semiconductors using something like XSD versus the s and p, not looking too healthy. So you could, you could see a scenario where will they sell again here and take us back to the lows possibly. I mean, we'll know that by crossing below levels. I think it's interesting how many gaps in price exist in the s and p 500 around these levels. When you look at daily information, right. We're still holding the election gap, which is, sits at approximately 58 60 58, 66.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753We're still holding that. There's a gap from earlier in this month there. There's a gap from this recovery in early May to get above a 200 day. There's a gap near 56, 74 from last year. So it's just interesting how this really important price levels here that we're wrapping around to see, and that's all this is, is studying the interaction of supply and demand. It's nothing. Earth shattering. It's just seeing where the buyers and sellers meet. And if we can stay above a 200 day and hold the election gap. The January 1st price is right here as well. I mean, we're talking, I shouldn't say January 1st,'cause technically the first was not a trading day, but we're right there where we were on January 2nd. As far as price is concerned on the s and p 500, so you have, you have all this weight of evidence out there on both sides. You've got broad based semiconductors versus s and p, not looking all that healthy yet. You're seeing strength outta international. You have something like JP Morgan versus the s and p trying to break out of three decade long base and you can't get too bearish if JP Morgan's gonna do something like that. But you can't get too bullish if semiconductors are selling off.
me_1_05-30-2025_124753All right. Well, it's like, feels like most times, right? You keep getting these mixed signals
david_1_05-30-2025_124753Mm-hmm.
me_1_05-30-2025_124753in certain areas. And I mean like with banks, like even globally, banks are looking pretty good. I know Gsib Gsib, B'S one we've used before that
david_1_05-30-2025_124753Yep.
me_1_05-30-2025_124753of those larger international banks, that's holding up pretty well, and even, insurance and I guess probably more specifically towards like the property and casualty side of that. Still holding up pretty well too, which is nice. They've been pretty consistent for the most part over the past couple months,
david_1_05-30-2025_124753Right,
me_1_05-30-2025_124753that's good to see,
david_1_05-30-2025_124753and you brought up global infrastructure,
me_1_05-30-2025_124753hmm.
david_1_05-30-2025_124753and defense global, globally systematically important banks. I mean, it's really, we're, we're not sitting here saying, oh, it's staples. It's utilities, it's not these safe havens
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753that are leading the way and, but at the same time, it's not all boxes checked, which it's almost never is.
me_1_05-30-2025_124753All right.
david_1_05-30-2025_124753And sometimes there's more boxes checked than others. I mean, for most of 20, 24, lot of boxes checked, especially after the breath thrust we saw in October and November of 23, and we still have the backdrop of this zig breath thrust that happened in April, first part of May. And at the same time in the short term, so that's more intermediate term, weeks to months in the near term, just a week or two ago, high percentage of stocks with A RSI reading above 70. So a little bit of pull, pullback and cooling off here for the next few weeks. Makes a lot of sense. So we'll see. I feel like I say that too much, but it really is. It's, it's a bay.
me_1_05-30-2025_124753I mean,
david_1_05-30-2025_124753It's a besian approach to statistics as you wait for the information to come in. And so it's kind of one of those things where you're positioned for risk, right?'cause you're above a 200 day moving average, but is your foot like all the way down on the accelerator? Not necessarily. This isn't the time to fly 80 down the highway. There's still some. Construction barrels on the side of the road worth paying attention to. What else? What, what other things are you looking at? And you can take this anywhere. You can go bonds, commodities, crypto. You could stay on stocks. Doesn't matter to me.
me_1_05-30-2025_124753I mean, in the commodity front there's really not too much going on. In like the egg space really, it's still just kind of cattle. That still looks really good. But like all your grains, things like that outside of Lake Canola really not showing much life there at all. I know you're talking about oil. Before, I still can't really get above 64 bucks a barrel. So it's pretty quiet on the commodity front, I guess, unless outside of like your precious metals. Because I mean, really gold and silver have been holding up fairly well,
david_1_05-30-2025_124753Yeah, I think that's,
me_1_05-30-2025_124753kinda
david_1_05-30-2025_124753yeah, I think that's a fair, it's been consol, it had such a strong move. I. Since, since breaking out of a, a base in 2023, and then another consolidation in 24 that it would consolidate here. It wasn't too many episodes ago that, in April that, that we talked about, is this really a great place to take on a new position in gold? Probably not, but I'll say that this consolidation in gold since for the past month and a half has been extremely constructive. Does that move higher? Especially if, if a trade weighted dollar is gonna remain below a hundred,
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753probably doesn't hurt.
me_1_05-30-2025_124753Yeah. You wouldn't think so, right? I mean, yeah, the dollar, I mean, it'd be interesting to see what the dollar does here. I definitely you would think, would give us a little bit of an idea of maybe what to expect looking forward. But
david_1_05-30-2025_124753On Bitcoin too. Bitcoin's exposed to the dollar and it's trying to hold the highest from 2024. We'll see if it can do that,
me_1_05-30-2025_124753No.
david_1_05-30-2025_124753but mati, materials overall, not that great.
me_1_05-30-2025_124753Mm.
david_1_05-30-2025_124753Gold. Gold and silver miners, even some of the copper miners holding up. Okay.
me_1_05-30-2025_124753Yeah.
david_1_05-30-2025_124753And I would call those that inflection points, especially if you look at something like a copper gold ratio at levels that we haven't seen on the bottom side since, the COVID bottom or the financial crisis bottom. So it'd be really interesting if that turned a corner here. So a lot of things at an inflection point, whether it's the on the top side, meaning like potential resistance, but also on the other side, potential support. And you've got Germany doing well, you've got Japan holding up the yen, holding up pretty good. So mixed signals, but I think you'd still tilt in the favor of the primary trend being up.
me_1_05-30-2025_124753Mm-hmm.
david_1_05-30-2025_124753As long as, as long as we're above a 200 day moving average.
me_1_05-30-2025_124753Yeah. Can't really argue with that. Really at that point.
david_1_05-30-2025_124753Anything else in the, in the commodity space? I know you mentioned uranium. Is that another one of those at an inflection point?
me_1_05-30-2025_124753kinda up against all time eyes and a lot of those ETFs. If you use like a, is it URA or I shouldn't say all time highs, but like recent, know, highs kind of going back to, 23, 24, kind of back towards like. 2016 ish, 2015. Kinda getting rejected there as of now. So we'll kind of see what happens there. But no, other than that, in the commodity space, pretty quiet. I mean, unless you get, like coffee I guess has been one that's performed pretty well for a while. Just kind of more of a, I guess short term, low I guess. But if you look at coffee futures kind of around this, call it like$3 40 cents a pound roughly in there. Maybe even like three and a quarter, kinda like, I guess like it to hold that if that's kinda your thing. And I mean, that's even one too that's been on quite the run. I guess it would. Kind of builds a range here. I don't think that would be, kind of the worst thing in the world.
david_1_05-30-2025_124753You buy your coffee in pounds, how does that work? I'm not a coffee drinker. How does that, when you buy a package of coffee, typically, typically ground up?
me_1_05-30-2025_124753Nope. I don't know. I guess I don't even like your average bag of like coffee grounds. I don't even know what the weight would be. I don't think it could be a pound. That would be, I. It seems like a lot, but maybe, I don't know.
david_1_05-30-2025_124753Just don't buy it is what I see.
me_1_05-30-2025_124753I don't even look, I mean, that's the thing with, it's almost better not to look when you're at the grocery store.'cause most, more often than not, you're gonna buy it anyway. So yeah, I try not to think about it too much.
david_1_05-30-2025_124753Do you, do they sell co? Do they still steal co coffee and tins? Like tin cans? That's still a thing.
me_1_05-30-2025_124753I mean, and I'm sure you can, I guess I haven't seen it, but I'm also not connoisseur by any means. I mean, if it, I'll pretty much drink just about anything I,
david_1_05-30-2025_124753We'll do.
me_1_05-30-2025_124753well, mostly if we start talking like jungle cat poop coffee, then I'm kind of out on that. That's not really my forte, but yeah, that's, I don't even think I could afford it actually anyway. Even if I
david_1_05-30-2025_124753Is that a Yeah. Is that a re, is it, is that like a prerequisite for like the, the person who's serving that has to like give a warning like, Hey, just so you know, this is jungle cat poop coffee,
me_1_05-30-2025_124753I, I have no idea. I probably better off if you don't do that, I don't know, maybe that then you can probably charge a higher price for it, right? Because that. Little bit of extra processing required.
david_1_05-30-2025_124753Fascinating. The coffee culture. America's definitely a coffee culture.
me_1_05-30-2025_124753For
david_1_05-30-2025_124753Doubt about it. So we've, we've covered a lot of ground. I always like to pause and highlight the supporter of this podcast, the adaptive select ETF, which is listed on the New York Sock Exchange, under ticker A DPV, which helps investors access two of the most prevalent factors in markets, momentum and relative strength using proprietary identification methods. The adapt to select ETF attempts to own the strongest 25 large cap stocks when the market is in an uptrend. And since not all market environments are the same. Adaptive Select seeks to prevent extended declines by moving to short-term treasury bills and cash during long-term market. Downtrends investors can find out more including how to invest in A DPV by visiting ad pv etf.com or calling 1-833-880-FIVE 200. Investing involves risk, including possible loss of principle AD PVS distributed by Quasar distributors LLC. So we didn't talk about momentum this week. Which we have been talking about the prior weeks, and I think it's safe to say that momentum is still, something in place. It when you look at it on a relative basis versus the s and p, another weekly closing, high monthly closing high. So that might be another one to check the box for a bull scenario if momentum is gonna be in play. At the same time, you could see momentum pausing here. It's had quite a run. Seeing that pull, pull, pull back or consolidate. But any anything else you wanna highlight for our listeners before we close this one down?
me_1_05-30-2025_124753That's too crazy. I don't think, I mean, TLT looks like it's kind of trying to find a bottom here.
david_1_05-30-2025_124753You went to bonds. That's great.
me_1_05-30-2025_124753right. I mean, I don't know. Rates kind of bumbling around here. Like, I mean, I feel like they have been for a while, so it. Doesn't, doesn't really feel like too much going on there, at least as of now. But
david_1_05-30-2025_124753Well, yeah, rates using 10 year treasury notes really haven't gone anywhere since October of 22, so sideways, so quite a move off the COVID, bottom in, in rising rates, but still range bound. Since late 2022, whether you're looking at 10 year or 30 year yields and sometimes markets like that, it's not about what the interest rate level is, it's just rate of change, like how much change is there in rates. And we haven't seen a tremendous amount of change since about then. And wouldn't, you know, in October of 22 is you could argue the. The major bottom after the last correction in 21, 22, that we've seen rates move sideways. So maybe there's something there that we continue to see rates move sideways, which would be potentially a bullish characteristic for equities. But we'll see.
me_1_05-30-2025_124753Yeah, and I think it's nice that like a lot of those risk on areas in fixed income I've kind of recovered, kinda like mid to late March into early middle of April, a of those areas, like your lower credit quality stuff like Triple Bs or just junk in general, like convertible bonds, which can, be a little bit more risk on, I guess, they've kind of recovered. So I mean that's kind of positive to
david_1_05-30-2025_124753It is.
me_1_05-30-2025_124753I mean, I don't know if they were necessarily, I guess quote unquote out of the woods yet for some of this. Because really, some of those instruments are kind of getting into some interesting levels. I mean, they got a little ways to go yet. But that'll kind of be one to watch probably here in the next couple weeks. I wanna see if that kind of sticks or if we get in the same scenario we're seeing with some of these other areas in equities. So.
david_1_05-30-2025_124753I think that's fair. I think, if you look at junk bonds using JNK. Testing the, the underside of a 200 day, or you look at junk bonds versus intermediate treasuries at an important level. You look at triple Bs back into a range. You've seen triple C credit spreads cool off. Do you see a resurgence in those? And, and, and so now it's about risk risk management as always. That, if you're seeing equities lose important levels, you're likely seeing some of those things perk up again, triple C credit spreads moving higher junk bonds, getting sold off. Those would be some of the things you you'd see in alignment. So it'll be interesting that weeks ahead, I don't know if we've got a messy summer ahead, where we're just consolidating. And it's, three to 5% moves on a weekly basis until we've chewed through the supply time. Will tell Anything else, Kevin?
me_1_05-30-2025_124753I don't think so.
david_1_05-30-2025_124753Okay. Well I appreciate you, you filling in. You always do a great job. All you, all the work you do. For our clients and for our team, you do a tremendous job. So it's great to get you on here and with that. I'll ask our listeners if you appreciate this information, share it with your friends, give us a high ranking on your platform of choice. We really appreciate it.
me_1_05-30-2025_124753Yep. Thanks. Have a good weekend.