Falling Oil

Please click here for an enlarged chart of United States Oil ETF (NYSE:USO).

Note the following:

  • Understanding the moves in oil are very important because they have been directly impacting bonds and moves in bonds in turn have been impacting the stock market.
  • The chart shows the run up in oil when Iran war fear was at its peak.
  • The chart shows a significant drop in oil when the U.S. and Iran started negotiating.
  • The chart shows a low in oil on optimism about Iran after a Memorandum of Understanding (MoU) was signed.
  • The chart shows a move up in oil on violations of the MoU.
  • The chart shows a big move up in oil when President Trump threatened the biggest attack ever on Iran.  Since then, instead of backing off, Iran has aggressively attacked U.S. bases in the region.
  • The chart shows oil is falling this morning as President Trump has backed off not only from a major attack on Iran but also from responding to Iran’s attacks on U.S. bases.  Negotiations are beginning today.
  • Yields are backing off today for two reasons:
    • A pullback in oil
    • Massive joint intervention by the U.S. and Japan in forex market to support yen
  • In the early trade, yields pulling back is bringing in buying in the stock market.
  • Buying in the stock market in the early trade is being hampered by selling in the South Korean stock market overnight.  Kospi fell 5.12% overnight.  Samsung Electronics Co Ltd (OTCPK:SSNLF) fell 8.76%, and SK Hynix (SKHY) fell 8.79%.
  • Selling from South Korea is bringing in selling in semiconductor stocks in the U.S. in the early trade, especially impacted is Micron Technology Inc (NASDAQ:MU) stock.
  • Looking ahead, there are important earnings from Advanced Micro Devices Inc (NASDAQ:AMD) and Space Exploration Technologies Corp (NASDAQ:SPCX) on Aug. 4 as well as SanDisk Corp (NASDAQ:SNDK) on Aug. 5.  There is also expiration of the SPCX lockup.
  • In major news, two pharma giants Bristol-Myers Squibb Co (NYSE:BMY) and AstraZeneca PLC (US) (NYSE:AZN) are in merger talks.

Magnificent Seven Money Flows

Most portfolios are now heavily concentrated in the Mag 7 stocks.  For this reason, it is important to rise above the noise of daily news on the Mag 7 stocks. 

In the early trade, money flows are positive in Apple Inc (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc Class C (NASDAQ:GOOG), Meta Platforms Inc (NASDAQ:META), Microsoft Corp (NASDAQ:MSFT), and Tesla Inc (NASDAQ:TSLA).

In the early trade, money flows are negative in NVIDIA Corp (NASDAQ:NVDA).

In the early trade, money flows are positive in SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust Series 1 (NASDAQ:QQQ).

Momo Crowd And Smart Money In Stocks

Investors can gain an edge by knowing money flows in SPY and QQQ.  Investors can get a bigger edge by knowing when smart money is buying stocks, gold, and oil.  The most popular ETF for gold is SPDR Gold Trust (GLD).  The most popular ETF for silver is iShares Silver Trust (SLV).  The most popular ETF for oil is United States Oil ETF (NYSE:USO).

Bitcoin

Bitcoin (CRYPTO:BTC) is seeing selling.

What To Do Now

Consider continuing to hold good, very long term, existing positions and add tactical positions based on signals.

The Arora Report is known for its accurate calls. The Arora Report correctly called the big artificial intelligence rally before anyone else, the new bull market of 2023, the bear market of 2022, new stock market highs right after the virus low in 2020, the virus drop in 2020, the DJIA rally to 30,000 when it was trading at 16,000, the start of a mega bull market in 2009, and the financial crash of 2008. Please click here to sign up for a free forever Generate Wealth Newsletter.

Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.