Market Pulse · July 22, 2026 · Post-Market Edition

MACRO ENVIRONMENT

The macro environment is signaling a ‘RISK-ON’ stance, supported by a strong ‘Safe’ reading on the Sahm Rule, indicating no immediate recessionary concerns. Both the 10y-2y and 10y-3m yield curves are ‘Normal,’ suggesting a healthy, albeit not aggressively expanding, economic outlook. While CPI remains ‘Elevated’ at 3.7%, the Fed funds rate is ‘Neutral,’ implying a steady hand from monetary policy, and the unemployment rate is ‘Healthy’ at 4.2%. However, the ‘Extreme Fear’ reading on the Fear & Greed Index (25) presents a potential contrarian buying opportunity, even as the DXY hovers in ‘Neutral’ territory.

MARKET PHASE

US equities, as represented by the S&P 500, are exhibiting a ‘Weak BULL’ trend, currently trading above its 20-day moving average with a low ADX of 12.4, suggesting that while the upward momentum exists, it lacks significant conviction. Bitcoin is also in a ‘Weak BULL’ phase, trading above its 20-day MA with an ADX of 20.4, indicating a slightly stronger but still subdued trend. The VIX remains ‘Normal’ at 17.05, down 8.6%, pointing to muted near-term volatility expectations. Overall, the market phase analysis indicates a divergence, with US equities consolidating sideways while Crypto maintains a bullish, albeit weak, trajectory.

SECTOR TRENDS

Sector rotation is showing a clear ‘Recovery’ pattern, with Energy, Real Estate, and Healthcare emerging as the top performers. This suggests a shift towards more cyclical and value-oriented sectors, potentially driven by expectations of sustained economic activity and inflation hedging. Conversely, Consumer Discretionary, Technology, and Materials are lagging significantly, indicating caution or underperformance in growth and cyclical segments sensitive to rising input costs or consumer spending shifts. Investors should note this rotation as a key indicator for positioning, favoring defensive and value plays over speculative growth areas in the current climate.