8/15 - 8/31 SPX, QQQ, DIA, IWM, SMH... Simple analysis.

Crude oil - /CL, the monthly trend is still downward, entered oversold zone at the weekly level (bottom at 86.85 on the weekly level), the daily level broke through 95.21 in the short term, looking up to around 102.

SPX-Bottom formed an upward trend (crossover) at the monthly level, entered overbought zone at the weekly level, and the upward momentum slowed down at the daily level. RSI showed clear divergence, and short-term pullback range is 4237-4194.

QQQ-monthly level bottom forming an upward trend (crossover), weekly level entering overbought zone, daily level upward momentum slowing down, RSI showing clear divergence, short-term retreat range 323-319.

IWM - The situation on the monthly and weekly levels is similar to SPX and QQQ, but the daily level momentum is significantly stronger than the previous two indices, focus on individual stock opportunities.

DIA - The daily level of the Dow Jones Industrial Average is also stronger than SPX and QQQ, focus on individual stock opportunities.

SPX

In my personal opinion, comparing the monthly level with the rebound after the sharp decline in March 2020, there is a significant difference in trading volume. Everyone knows it's because of the liquidity injection by the Federal Reserve at that time. However, this rebound compared to the previous one has relatively weaker trading volume, indicating that large funds may not have entered yet. Now it is at a critical point of rebound, and it needs sufficient trading volume to continue to push the index higher. In terms of inflation data, although the July data has eased somewhat, it is still far above the target of the Federal Reserve. If we look at the data, if US employment and the economy remain strong, logically speaking, the Federal Reserve will accelerate its tapering and interest rate hikes to further reduce inflation. But I don't think the rate hikes will be too aggressive because the inversion of the 2-year and 10-year Treasury yields indicates that investors have a pessimistic view of the future US economy. Therefore, I think there is a relatively high probability of a 0.5% rate hike in September, as long as the Federal Reserve can taper its bond purchases moderately, the probability of the overall market continuing to rise with decreasing trading volume is still quite high.