The sellers have gained a slight advantage Wednesday, but it is trading-range action with the indexes making little progress for the past week. Small caps have been languishing even longer, but plenty of technical support remains.
What is most notable about the market now is the lack of emotion. Although there is plenty of news for the headlines, the market's reaction is muted and not sustained. Bad news leads to dip-buying and good news fails to produce protracted momentum.
Some of the most notable action Wednesday is in precious metals. Gold (GLD) and silver (SLV) are pushing higher and some of the miners I mentioned weeks ago are still trending nicely. Both Kirkland Lake (KL) and Agnico Eagle Mining (AEM) are hitting new highs. The silver miners are showing some exceptional relative strength now.
Strength in gold is largely due to a weaker dollar and the weaker dollar is mainly due to the prospect of lower relative interest rates in the U.S. Currently, the market believes there is about a 65% chance of a quarter-point drop and a 35% chance of a half-point drop at the Fed meeting at the end of July. As long as those expectations stay unchanged, the tight trading range action will continue.
I'm doing a little day trading while I wait for the market to develop further. At least we have some earnings reports after the close from Netflix (NFLX) and IBM (IBM) to liven things up. Next week there will be a deluge of reports to keep us entertained.