Episode 258: Sentiment Check

In this week’s episode, David and Ian discuss the current sentiment in the market, the Put/Call Ratio, major indices and areas of the market that are participating to the upside and trading above their 200 day moving averages, international equities, and interest rates. 

Transcript

david_2_06-20-2025_095235 0:27

Welcome back to The Weekly Trend Podcast. Today is Friday, June 20th, 2025 s and P 500, currently sitting at 59 67. I'm David Darling. I'm here with two weekends. Ian McMillan.

ian_1_06-20-2025_105226 0:42

It feels like that yesterday threw me off.

david_2_06-20-2025_095235 0:45

Yeah, sometimes it does that. Market closed.

ian_1_06-20-2025_105226 0:48

It truly feels like a.

david_2_06-20-2025_095235 0:50

Closed. Yeah. No, it does. Yeah, it, it, it's kind of a, a weird, uh, dynamic once when the market is closed. Yesterday being Juneteenth day, you know, I kind, I kind of wish they might call it emancipation day, like just call it what it is, but I'm sure there's some significance too.

ian_1_06-20-2025_105226 1:07

Yeah,

david_2_06-20-2025_095235 1:08

Why Juneteenth?

ian_1_06-20-2025_105226 1:08

Not the best holiday name we've ever come up with in this country.

david_2_06-20-2025_095235 1:12

Right. And I,

ian_1_06-20-2025_105226 1:14

Day, Memorial Day, veterans Day, all pretty straightforward.

david_2_06-20-2025_095235 1:18

yeah, and it maybe it's a, um, a colloquialism, like a term that was used way back, you know, Juneteenth. But from a broad marketing perspective, emancipation Day would be a pretty cool term'cause it's important to celebrate, but I think it gets lost in. The name a little bit, but I digress. It was nice to have a a day off yesterday. Closed markets we're heading into where we get the longest sunlight daylight of the year where it's summer solstice.

ian_1_06-20-2025_105226 1:49

Yes,

david_2_06-20-2025_095235 1:50

Pretty nice.

ian_1_06-20-2025_105226 1:51

starting today.

david_2_06-20-2025_095235 1:52

Yeah. Today and tomorrow we're in, uh, summer solstice time, and so these are the longest days right here, at least for us North Americans. So pretty, pretty nice. Not a lot to complain about, but it does seem like there's a lot to complain about in the media cycle.

ian_1_06-20-2025_105226 2:09

Oh my gosh. A lot of hoopla for, I mean, we're exactly where we were last Friday when we recorded the podcast.

david_2_06-20-2025_095235 2:17

One, I, you know, it's, it's interesting the algorithms on socials, the commentary in the family chats. Lot of focus on potential World War iii. I find that very fascinating.

ian_1_06-20-2025_105226 2:32

That's, and but isn't that such a loose term now?

david_2_06-20-2025_095235 2:35

Probably.

ian_1_06-20-2025_105226 2:36

I mean, world War iii, it's trending on Twitter every few weeks. Every

david_2_06-20-2025_095235 2:41

It does,

ian_1_06-20-2025_105226 2:42

Is this gonna be World War iii?

david_2_06-20-2025_095235 2:44

yeah. It does seem, it does seem like the war drums are pounding from a. And I've got another term for news cycle that could be propaganda too. I think you just gotta be careful not buying in and not, you know, people news has a job to do and that's to sell you advertising and you gotta sensationalize what's out there.

ian_1_06-20-2025_105226 3:05

But hey, we're above We're above a, I'm gonna put, I'm gonna put it back in the rising category. I think it's a rising 200 day. We took a

david_2_06-20-2025_095235 3:15

Oh yeah. Yep.

ian_1_06-20-2025_105226 3:16

flat there for April, but we are back upward sloping.

david_2_06-20-2025_095235 3:23

Yeah. S and p.

ian_1_06-20-2025_105226 3:24

I mean, I don't want it to be,

david_2_06-20-2025_095235 3:27

Yeah. I don't, I don't want it to be either. I'm. I'm not eyes wide shut on it. I'm not trying to be ignorant about it, but I also know that it's quite okay if cooler heads prevail and diplomacy takes place. But yeah, s and p 500 remains above a rising 200 day. The NASDAQ remains above a rising 200 day. The Dow Jones is just below its 200 day, and so is IWM.

ian_1_06-20-2025_105226 3:51

Yeah, Del Jones' kind of bumbling around, and I mean, Russell Russell's been bumming it for a while. Couch surfing,

david_2_06-20-2025_095235 3:58

Yep.

ian_1_06-20-2025_105226 3:59

who's ever willing to take him in for a few weeks.

david_2_06-20-2025_095235 4:02

And I think the, you know, you talked about kind of being at the same place we were last week. International stocks, not so much. They got sold a little bit this last week and wouldn't you know it, that's happening at a relative rate of downtrend. You look at something like EU versus S and p,

ian_1_06-20-2025_105226 4:21

Yes. V-E-U-E-F-A in that same category.

david_2_06-20-2025_095235 4:26

Yep, exactly.

ian_1_06-20-2025_105226 4:28

And Always so hard.'cause we did, we had, there was a lot of foreign hype

david_2_06-20-2025_095235 4:34

Right,

ian_1_06-20-2025_105226 4:36

Like March, April. I mean, we owned foreign, we owned some select areas,

david_2_06-20-2025_095235 4:41

right.

ian_1_06-20-2025_105226 4:42

but. This is why it's so hard. Foreign stocks are just very, very boy who cried wolf with me and we, here we are again. So far no wolf.

david_2_06-20-2025_095235 4:52

Yep. So far no wolf. And there's different areas that showed strength this week. You know, energy makes sense. When you consider last week and this week what oil has done, and I get it, you could say, well, Dave, yeah, that there's a conflict in the Middle East. There's bombing happening in Iran. There's the threat of closing the straighter Horus like. Well, yeah, but what's interesting is price in oil started accelerating higher before there were even any airstrikes on iram. Again, the market pricing in before the news comes out,

ian_1_06-20-2025_105226 5:27

one, mid, early May.

david_2_06-20-2025_095235 5:30

right?

ian_1_06-20-2025_105226 5:31

55 bucks and we're already back that little 73 now, but we got up to 70. We got up 76.

david_2_06-20-2025_095235 5:37

I think there's a couple different market dynamics worth highlighting in play. You know, whether it's something like semiconductors using SMH, being against levels that we've sold at before, going back to June of 2024. Be interesting to see if we can chew through the supply. The NASDAQ Act, same thing, had levels back in December of 24.

ian_1_06-20-2025_105226 6:01

They

david_2_06-20-2025_095235 6:01

Technology,

ian_1_06-20-2025_105226 6:02

would they?

david_2_06-20-2025_095235 6:03

technology, stocks

ian_1_06-20-2025_105226 6:05

Yeah.

david_2_06-20-2025_095235 6:06

at levels,

ian_1_06-20-2025_105226 6:06

made it go for all time highs, didn't it?

david_2_06-20-2025_095235 6:09

right? So there's still some things to pay attention to here, not necessarily out of the woods, but the great thing about being a technician and using the study of supply and demand in your process. We've talked about 5,800. We've talked about the 200 day moving average. We've talked about the zero line or the January 1st date. We've talked about the election gap. These are logical areas where if this market is serious, if buyers are serious, they'll hold these levels. If not, then we know sellers have control and we can adjust accordingly.

ian_1_06-20-2025_105226 6:41

Agreed.

david_2_06-20-2025_095235 6:42

What, uh, sectors, areas, you could take this anywhere that pique your interest when you look at what's going on, whether it's broadly speaking or underneath the hood in this market.

ian_1_06-20-2025_105226 6:54

Yeah, you mentioned semiconductors. Uh, I think there's a lot of things in tech that are pretty solid cybersecurity. Like six GI believe came up in one of the workbooks. It's not a cybersecurity ETF, but like connectivity I think Play and platinum still. I mean, while gold is kind of chilled out, pin sideways for almost two months.

david_2_06-20-2025_095235 7:21

Pretty normal behavior considering how, how,

ian_1_06-20-2025_105226 7:24

healthy. It's on a heck of a move.

david_2_06-20-2025_095235 7:27

When you look at like broker dealers and capital markets, how good they're looking on a, on a relative basis. You've got JP Morgan. On a relative basis trying to go out at new 35 year highs, and we're at the highest we've seen in that relationship since March of 1999. So think about that. You could have held SAP or JP Morgan had the same return since 1999. So if we see JP Morgan break out of this base or something like American Express versus s and p, which is on the verge of a 52 year breakout. The highest level we've seen, we've seen since February, 2014. I mean, that's, that's two pretty big financial indicators there. It's not that financials have to outperform, but if they're participating like this, really hard to get bearish on the market.

ian_1_06-20-2025_105226 8:20

It is

david_2_06-20-2025_095235 8:21

And if something like Apple, which has been sitting in the back pocket of this market, right, Apple's been underperforming, uh, for a while.

ian_1_06-20-2025_105226 8:29

pass.

david_2_06-20-2025_095235 8:30

If that starts to perform, and I know you high highlighted on Twitter that we're back at levels that have shown to be support in the relative relationship since January, 2023.

ian_1_06-20-2025_105226 8:43

yeah. This has been a spot where, yeah, on a relative basis, investors, traders, whoever have become interested, supply, I. Or excuse me, demand for apple could likely outpace demand for the s and p or supply is less. I don't know which way. Maybe it under, maybe Apple underperforms to the downside. I have no idea.

david_2_06-20-2025_095235 9:13

Right.

ian_1_06-20-2025_105226 9:14

but given where we are in the overall environment, you know, we talked about the market is healthy, we haven't got to new all time highs. It is healthy. Mags and fangs have been good XLK, so it wouldn't be a big shot. It's kind of the one, I mean, Microsoft is already to new. All time highs has been there.

david_2_06-20-2025_095235 9:35

Holding steady.

ian_1_06-20-2025_105226 9:36

is, you know, it's best since a year ago, July, 2024.

david_2_06-20-2025_095235 9:41

Well, and you, if you look at something like communication services like XLC versus s and p, Nice consolidation since February, so you know, we'll call it a four month consolidation. Holding up very well, we would put that in the risk on bucket. Yet we have these levels, you know, XLK at important level Q, Q at an important level. Semiconductors at an important level, important in the sense of this is where they sold'em before. This is where they started selling'em in January and February earlier this year. Will demand be able to push through supply here? It's interesting to think about, and especially when you think about this period that we're heading into here. I know seasonally speaking, you know, Jeffrey Hirsch does a great job at Almanac Trader, He just highlighted that a mid-year rally, he calls it Christmas in July, that around June 26th through July 14th, the Nasdaq is up 31 outta the last 40 years, so. Do we get a, a period of time here where the NASDAQ does push through all time highs, time will tell. I mean, that's the wonderful thing about data and looking at it, supply and demand, is that we could tell, you know, do the buyers have enough oomph in them, in them to push it through. I don't know if I've ever used the term oomph on this podcast, but there's always a first for everything. If Apple wants to participate, that's a great thing.

ian_1_06-20-2025_105226 11:12

Yeah, ARDI had a good tweet on that. Yeah, like year three of a bull market's pretty choppy,

david_2_06-20-2025_095235 11:17

Yep. Yeah. Year three out of four. One, two. Great. Three choppy, four better. So it makes sense the, the, uh, environment that we're in. But we, as we highlighted before, we're s ps above a 200, a above 5,800. These are good things, and I don't know that we could sit here and say the market's too high. cause the cardio also highlighted that EQAL, which is the Russell 1000 equally weighted. 0% return since November of 2021. And then if we throw on there something like the value line geometric index, which is another way to measure what has the average stock done? 0% return since January of 2018. And small caps IWM, who. Nothing but shade on this show until it starts getting in an uptrend. But Russell 2000 0% return since January, 2021. So I don't know that we get to say that stocks are too high at this point.

ian_1_06-20-2025_105226 12:16

Some stocks, but not stocks as a whole, well, I mean, some stocks are high. I you, it's hard to say anything's ever too high or too low

david_2_06-20-2025_095235 12:24

Right. That's how momentum and trends work.

ian_1_06-20-2025_105226 12:27

It's like saying something's due. Famous

david_2_06-20-2025_095235 12:29

And I know, you know, to marry the, the World War II narrative that's out there. We have pretty large retail equity outflows over the past few weeks. We have a P call ratio. I haven't heard necessarily heard anybody talk about this. That's elevated at about 0.98. So people are. Hedging pretty heavily here and it makes sense, right? You go right into these prior highs from January and February to hedge that out. But we know that put buying is typically future fuel if they get squeezed and have to be forced to close their position. It's really when market participants stop shorting this market that's when you get. A little bit more nervous. And here again, we've got pretty large hedging going on. Pretty large bets going on that could cause a squeeze higher through the prior highs. We'll see. What about bonds? What about interest rates?

ian_1_06-20-2025_105226 13:25

Interest rates, staying up there sideways, stock sideways for a couple weeks, interest rates sideways for, I mean over a month. Consolidating near the highs. I. Got, yeah, I mean, 30 year got up to 5%. We didn't really see a drastic excel up. Not yet. Makes me feel like, uh, you want to err on the side of rates going higher, which we knew that though. I mean, based on the proceeding trend. Well, they're hanging in there.

david_2_06-20-2025_095235 13:55

How about crypto?

ian_1_06-20-2025_105226 13:55

it look like? Yeah. Crypto also, you know, if we talk about Bitcoin hanging in there, really struggling with 1 0 7, 1 0 8, it's giving it a couple good rally attempts, but cannot hold 1 0 8. I even tried again, uh, last week. Couldn't do it. So we're just stuck in a tight ra, well tight for crypto and it's a one of, you know, a hundred to 110 if you wanna call it that 10% range. It's pretty, pretty low volatility for this asset.

david_2_06-20-2025_095235 14:33

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ian_1_06-20-2025_105226 15:26

An uneventful week. Rates

david_2_06-20-2025_095235 15:29

Yeah.

ian_1_06-20-2025_105226 15:29

Stocks flat. Bitcoin flat. Gold flat. I, it is. I think it's like we took the week off from volatility.

david_2_06-20-2025_095235 15:38

Yeah, that's fair.

ian_1_06-20-2025_105226 15:40

What is, speaking of volatility, is VIX Flat, pretty flat?

david_2_06-20-2025_095235 15:45

Yep.

ian_1_06-20-2025_105226 15:46

Which is good. We don't want volatility moving all over the place.

david_2_06-20-2025_095235 15:49

Agreed. So we've covered, we covered quite a bit. You know, I think it's a quick summary would be if Apple starts to participate in this market, it's gonna be really hard to pull it down. If you've got things like JP Morgan and American Express breaking out versus the s and p or broker dealers and capital markets breaking out versus the s and p. While interest rates are steady during a negative news cycle and high put call ratio, the ingredients are there as we head into a seasonally strong period here that we could push through all time highs. But the beauty is we have the data in front of us for breaking back below 5,800 and a 200 day moving average on something like the s and p. That'll be information that buyers

ian_1_06-20-2025_105226 16:31

are off,

david_2_06-20-2025_095235 16:32

all bets are off. We can adapt Ian. We don't have to.

ian_1_06-20-2025_105226 16:36

That's nice. That's

david_2_06-20-2025_095235 16:37

Yeah, it is right. We don't have to, uh, bury our head in the sand or dig our heels in. I can't think of any other metaphors. We just can.

ian_1_06-20-2025_105226 16:48

you're probably, if we go back below now, you're probably gonna get a lot of talk about 20 15, 20 16 type behavior.'cause we did that 2015 We rallied back across the 200 day, never quite made its all time highs. Bumbled around there for a couple months lower again actually broke to new lows. Recovered. So yeah, it could be, I'm not saying that happens. I'm not saying this. Two years of volatility, this is show be a pretty wide range. I mean, like a mega version of that. I don't even know if that's the right term

david_2_06-20-2025_095235 17:26

Yeah, it's just waiting.

ian_1_06-20-2025_105226 17:27

just 12. We had a 12 and a 14% correction in there, so nothing terrible in regards to draw downs. Obviously had a 20%, another 20% would, that'd be noisy, Dave. I can

david_2_06-20-2025_095235 17:48

It would be.

ian_1_06-20-2025_105226 17:48

you that it would be noisy.

david_2_06-20-2025_095235 17:50

A hundred percent and it would be right if price is doing that with the news cycle.

ian_1_06-20-2025_105226 17:58

Yeah,

david_2_06-20-2025_095235 17:59

Be a lot of fear,

ian_1_06-20-2025_105226 18:01

well,

david_2_06-20-2025_095235 18:01

but we'll see.

ian_1_06-20-2025_105226 18:01

it makes total sense. Here comes World War ii.

david_2_06-20-2025_095235 18:03

Yeah, exactly. So we'll see. We'll see where the market takes us. As always, we'll use price. The interaction with supply and demand, the manifestation of opinion and final arbiter of value to determine whether to be involved or not. And right now we can be involved. Yes, there's gonna be daily ups and downs, but it's not one day that makes a trend. It's about what the trend is overall. And as you highlighted at the beginning of the podcast, we have price above rising 200 day moving averages. Until then it, it's the bull market is innocent until proven guilty. And if we drop below that, then guilty is charged and we adjust accordingly.

ian_1_06-20-2025_105226 18:43

You can always adjust.

david_2_06-20-2025_095235 18:45

That's right.

ian_1_06-20-2025_105226 18:46

one time you had 20 year treasury bonds for a couple hours,

david_2_06-20-2025_095235 18:50

That's right.

ian_1_06-20-2025_105226 18:50

and that was the top.

david_2_06-20-2025_095235 18:52

And that was the top. Well, Ian, I appreciate you doing these with me. Uh, what was a great time? And to those listening, we hope you appreciate this. We hope you have a wonderful weekend, but we ask you to share this with your friends. Give us a high ranking on your platform of choice. That's a compliment to us and we really appreciate it. Thanks everyone.

ian_1_06-20-2025_105226 19:10

Have a great weekend.