Daily Commentary: July 23, 2025

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Don’t Chase Gaps Up

Posted by Pete Stolcers on July 23
www.oneoption.com

Our best trading set-up is a pullback on the open. Once it finds support buy strong stocks.

PRE-OPEN MARKET COMMENTS TUESDAY – The economic news is light this week and there are not any major earnings announcements after the close today or before the open Wednesday. TXN will report after the close today. GOOG and TSLA report after the close on Wednesday.

Scott Bessant said that the August 12 deadline for Chinese tariffs is likely to be extended. That should reduce some anxiety.

When the market gaps up or it makes an early run at the all time high, profit takers surface. We saw that yesterday. Resistance is building and we want an early bid check. Once that support is confirmed, we can proceed with confidence. We want to join the uptrend and buyers are not very aggressive until they have that assurance.

There’s really not much to add. Be careful, major news is pending. Earnings reactions and forward guidance (or lack thereof) will drive the market in August and September.

The market surged higher in the first hour of trading yesterday, it compressed for most of the day and then it gave the gains back just as easily in the last hour. I am noticing selling pressure in some of the high flying names. If they are well above EMA 8, I would avoid them. They are vulnerable to profit taking.

Support is at SPY $626.50 and resistance is the all-time high.

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