Bonnie’s Market Update 7/25/25

The major averages were all higher last week. All eleven S&P SPDR sectors were higher. Health Care (XLV) and Materials (XLB) were the strongest sectors, while Consumer Staples (XLP) and Technology (XLK) were the weakest sectors. The SPDR S&P 500 ETF Trust (SPY) rose by +1.52%.

S&P SPDR Sector ETFs Performance Summary 07/18/25 – 07/25/25

072525 weekly SPDR Sector

Source: Stockcharts.com

Figure 2: Bonnie’s ETFs Watch List Performance Summary 07/18/25 – 07/25/25

072525 Bonnie’s ETF Watch List

Source: Stockcharts.com

Biotechnology was hot. International markets, including those in China, were strong as the dollar weakened. Semiconductors and Gold fell. Small Cap Growth and Value underperformed the S&P 500. Silver was slightly higher but reversed lower, falling          -2.34% on Friday.

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Charts to Watch:

 Figure 3: UST 10YR Bond Yields Daily

072525 UST 10YR Bond Yields Daily

The 10-year U.S. Treasury rose last week, closing at 4.386. Continued rising yields could dampen the equity rally in the near term. On the other hand, declining yields would be positive in the short-term.

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Figure 4: Fear & Greed Index

072525 CNN Fear and Greed Index

Source. CNN.com

Investor sentiment, as measured by the Fear and Greed Index (a contrarian indicator), decreased by 1 point to 74, dropping from Extreme Greed to Greed last week.

NYSE New Lows Ended the Week In the Lowest-Risk Zone

Figure 5: NYSE New Lows

072525 NYSE New Lows

 Source: Stockcharts.com

New Lows On The NYSE peaked at 1167 on 4/7/25, then contracted sharply as the market bottomed in April.

New Lows closed at 15 last week, falling into the very low-risk zone where prices tend to rise. This indicator is one of the few that has shown no signs of trouble brewing yet. It would remain positive in the short term if New Lows stay between 25 and 50. An increase above 150 would be negative. Learn more about the significance of New Lows in my book, Journey to Wealth, published on Amazon. For a chapter preview of Journey To Wealth, you can download a free chapter on my website here.

Figure 6: CBOE Volatility Index (VIX)

072525 VIX Daily

Source: Stockcharts.com

The CBOE Volatility Index (VIX), a measure of fear, has continued its downward trend since its high made at the April bottom. The VIX closed at 14.93, the lowest reading since February, but it is still not yet at the December 2024 low. Historically, VIX tends to rise during the next several months. A reading above 22.50 would be the first sign that intraday volatility is likely to increase.

Figure 7: Value Line Arithmetic Average Weekly (Top) and 12-26-9 MACD (Bottom)

072525 VLE Weekly

Source: Stockcharts.com

The Value Line Arithmetic Index ($VLE) is a mix of approximately 1700 stocks. The VLE intermediate price trend from October 2022 remains in an uptrend (pink line). VLE continues to close above its 50-week moving average (blue rectangle) and 200-week moving average (red rectangle), a sign of strength.

The VLE broke the April uptrend in May, but no downside pressure materialized. Last week, VLE rose by +1.99%, but has not yet confirmed the highs made in the S&P and Nasdaq.

The key support levels are 11400,11250,10800, 9700, and 9200. A weekly close above the old high at 11,856.24 would imply further gains ahead. On the other hand, failure to make a new high and a close below support at 11,250 would increase the odds of a correction towards 10800.

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The S&P 500 Intermediate Momentum Continues to Rise

Figure 8: S&P 500 Weekly (SPY) and 12-26-9 MACD (Bottom) (Middle), and Money Flow (Bottom)

072525 SPY Weekly

Source: Stockcharts.com

The S&P 500 (SPY) remains in an intermediate uptrend from October 2022. After hitting a low in April 2025, SPY consolidated its gains and then broke out of its channel, followed by making a new all-time high.

The MACD (bottom chart) remains on a buy, above 0, rising, with strong momentum. MACD could generate a sell signal if the sellers take control.

The MFI Index closed at 84.90, indicating an overbought condition, in an area where pullbacks typically occur, making it potentially a good time to lock in profits.

Summing Up:

The SPY continues higher despite warnings that a pullback would occur. SPY intermediate upside projection at 700.00 remains. A weekly close below 575.00 would negate the intermediate upside projection of 700.00. The upside daily projection previously given for SPY, mentioned in the July 3 and July 18 updates, of 635.00, was reached last week.

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SPY Daily Short-Term Negative Divergence Looms.

Figure 9: S&P 500 Daily (SPY) Price (Top), 12-26-9 MACD (Middle), and Money Flow (Bottom)

072525 SPY Daily

Source: Stockcharts.com

The S&P 500 (SPY) reached a new record high this week, continuing to close above the 50 – and 200-day moving averages, a sign of strength.

The upside objective of 635.00 for the SPY daily was hit on Friday, August 25. Support is at 627.00, 622.00, 612.00, 592.00, and 585.00.

The MACD (middle chart) gave a repeat sell signal above 0, completing the bearish negative divergence (higher high in price with a lower high in MACD). The SPY continues to rise. The jury is out on whether there is more upside or a pullback will begin.

The Money Flow Index (lower chart) has held above the key 50 support level since April. A break below would be a short-term negative.

Summing Up:

With SPY short-term extended (daily chart) hitting its objective, a pullback towards 575.00 to test the breakout of the intermediate SPY channel is possible at any time.

Russell 2000 Index (Small Caps) momentum is weakening. 

Figure 10: Daily iShares Russell 2000 (IWM) Price (Top),12-26-9 MACD (Middle), and Money Flow (Bottom)

072525 IWM Daily

Source: Stockcharts.com

The iShares Russell 2000 Index ETF (IWM) finished the week up +0.92%, underperforming the S&P 500.

IWM had broken the November 24 downtrend (green line) and appeared to have successfully tested the breakout. However, it’s disturbing that there is no significant follow-through to the upside. On the other hand, it’s a positive sign that IWM continues to move higher, and close above both the 50-day moving average (blue rectangle) and the 200-day moving average (red rectangle).

IWM short-term support at 221.00 held last week. Next support is 214.00. Two closes below 214.00 would imply that the breakout failed and likely indicate weakness in the short-term.

The MACD (middle chart) remains on a sell signal, above 0, and falling with a bearish triple top formation.

The Money Flow (lower chart) reached 80, indicating an overbought condition earlier in May, and is trending down. The Money Flow Index falling below 50 would be considered negative.

S&P 600 Small Cap Index internals weakening

Figure 11: S&P 600 Small Cap Index and Percentage of stocks above the 20-day MA (middle chart) and 50-day MA (bottom chart)

072525 S&P 600 percentage stocks above 20 and 50 MA

Source: Stockcharts.com

The S&P 600 Small Cap Index rose last week by +0.92%.

Last week, the percentage of stocks above the 20-day MA (middle chart) had a slight uptick. However, any short-term weakness will likely break the April uptrend.

The percentage of stocks above the 50-day MA (bottom chart) rose from 63.50 to 66.57 last week, remaining below the uptrend (purple line, red circle).

The S&P 600 Small Cap Index (top chart) key support is at 1352.00 (brown line). Two closes below would be short-term negative and imply it will be harder to make money in small caps.

Semiconductors turn lower

Figure 12: Daily Semiconductors (SMH) (Top), 12-26-9 MACD (Middle), and Money Flow (Bottom)

072525 SMH Daily

Source: Stockcharts.com

The top chart shows the Daily Semiconductor (SMH) ETF, which is concentrated mainly in US-based Mega-Cap Semiconductor companies. SMH tends to be a leading indicator for the market when investors are willing to take on increased risk, and the opposite is true when the market is falling.

SMH fell last week -0.97%, continuing to trade within a tight range and closing above the rising 50-day MA (blue rectangle) and the 200-day MA (red rectangle), indicating underlying strength.

The June uptrend is in jeopardy. Support is 282.00, 272.00, 265.00, 256.00, and 243.00. Resistance remains at 290.00 with an upside objective of 315.00. Two closes below 265.00 would negate the upside objective.

The MACD (middle chart) remains on a sell signal. After sideways momentum above 0, and generating repeat sell signals, MACD is falling, suggesting that risk is on the rise.

The Money Flow (lower chart) has declined since June, after reaching above 80. Note that the intermediate chart of SMH (not shown) is also above 80.

SMH can be highly volatile. If leadership in Semiconductors (SMH) continues, it would have a short-term positive impact. On the other hand, if SMH begins to lag and underperform, breaking support, a pullback is likely to trigger stops and profit-taking.

 Figure 13: QQQ Daily  Invesco QQQ Trust (QQQ) Price (Top), 12-26-9 MACD (Middle), and Money Flow (Bottom)

072525 QQQ Daily

Source: Stockcharts.com

The Chart shows the daily Invesco QQQ, an exchange-traded fund based on the Nasdaq 100 Index.

Support is at 564.00, 550.00, and 544.00. Resistance is at 568.00. QQQ upside objective is  580.00. Two closes below 544.00 will negate my upside objective.

The daily MACD remains on a sell signal above 0, with repeat sell signals and a negative divergence, suggesting that risk is on the rise and a potential pullback could occur.

QQQ performance will be influenced this week by earnings from Microsoft (MSFT), Apple (AAPL), and Meta Platforms (META), which represent approximately 22% of QQQ.

Figure 14: Earnings For the Week of July 28

Source: Earnings Whispers

Key earnings reports released this week could lead to significant fluctuations in volatility.

Summing Up:

Records highs in the S&P 500 and Nasdaq last week. The intermediate trend remains up. Short-term indicators continue to display warning signs, daily momentum has slowed, and negative divergences persist, yet the market remains resilient, with the bulls in control. Earnings season continues, and complacency has set in. The August 1^st tariff deadline looms, and August, September, and October could be volatile months. Take the time to evaluate your portfolio, lock in some profits, and ensure you are not over-invested in equities. Also, verify that your stops are in place if you are a short-term trader and that you are not taking on more risk than fits your lifestyle. Manage your risk, and your wealth will grow.

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Bonnie S. Gortler

Bonnie Gortler, Consultant, Coach, and Author specializing in Wealth and Well-Being, is a successful stock market professional who has been instrumental in managing multi-million-dollar client portfolios within a top-rated investment firm during her over 35-year corporate career. As the author of "Journey to Wealth" anand "Journey to Well-Being", Bonnie is dedicated to teaching the importance of risk management and achieving true financial well-being by integrating both the technical and mental aspects of investing. With an M.B.A. and certification as a life coach, Bonnie combines her passion for coaching, consulting, and blogging to inspire people globally. Her powerful techniques and winning mindset help others experience personal growth and financial success. Explore wealth-building tips, personal development strategies, and more at BonnieGortler.com, and discover how you can enhance your wealth and well-being.

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