Get Ready for a Huge Week of News — And Trading Opportunities

A confluence of earnings, economic news, and rotational action is hitting this week and offering major trading opportunities for aggressive market participants. The market has been undergoing a dramatic shift recently as big-cap technology names pull back and money rotates into smaller stocks and the broader market, creating promising technical conditions.

The underreported story right now is that we have a real bull market in a large number of stocks that have languished for years. Pundits and the news media have been celebrating a "fake" bull market in which a very small number of big-cap names have driven the indexes higher while most stocks have not participated. Now, the table has turned, and many market commentators seem befuddled by what is happening.

This major shift in the market is happening as we enter the biggest week of earnings this quarter. Microsoft MSFT reports on Tuesday, Meta META on Wednesday, and Apple AAPL, Amazon AMZN and Intel INTC on Thursday. Smaller-cap stocks also start to report, and that will pick up next week.

In addition to earnings, there is a Fed meeting on Wednesday afternoon and the July jobs news on Friday. Expectations for a rate cut in September have been building, and there is a good likelihood that the Fed will send some signals about its plans.

The combination of earnings and economic news will provide some volatility, and at the same time, many charts are developing bullish technical patterns. It should be a great setup for aggressive traders looking for action.

One theme that many traders will be watching is for a rebound in the Magnificent Seven names as they report earnings. The group has had its deepest correction since its bottom in late 2022, and many investors still view them as must-own names. My favorite in the group remains Amazon, which reports Thursday.

I am looking at some earnings plays and will have an update on one later today.

At the time of publication, Rev Shark was long AMZN.