Welcome to July.
We’ve officially entered the back half of 2026. Take some time to reflect… How is 2026 going for your account?
If you’re struggling, don’t get discouraged. There’s a reason for your shortcomings…
And a fix.
The main reason you’re struggling: the market is a bit of a mess right now.
Trends start, then stall. Rallies spark, then die. One day we rip higher, the next day we slam back down.
If you can’t get a grip on this tape, you’re not doing anything wrong.
This is summer trading.
And it’s setting up one of my favorite windows of the year…
The Big Money Went on Vacation
My strategies piggyback the strategies of major market institutions.
I want to play the same game the pros play and ride the flows the big banks create with their piles of cash. When the smart money is present, the price action is cleaner, and the moves have more conviction.
Right now, the smart money is gone.
Summer thins out the institutional flow, and without the big players leaning on the tape, everything turns to stop-start volatility. We start something, then we stop. We push, then we stall.
I call it the chop shop.
And we can see it on the chart of the Invesco QQQ Trust (NASDAQ: QQQ).
We ran 35% off the late-March lows into an all-time high on the 3rd of June. It was an unbroken face-ripping rally on the back of the ceasefire that cooled the war fears. Then the music changed.
Since those highs, the QQQ turned into a meat grinder. Sharp drops, huge range bars, sudden pops higher, lower and lower volume the whole way. There isn’t any real conviction. And it’s because there isn’t any real money stepping in.
We’re stuck in the post-war part of the cycle, where the market can’t find the next catalyst to grab onto…
If the chop rolls over this summer, I’ve got two levels marked on the QQQ. The first Fibonacci retracement sits at $674, roughly 7.5% below our current level. Slice through that, and we’re looking at the low $600s, down near $629.
The SPDR S&P 500 ETF Trust (NYSE: SPY) looks the same, maybe a touch weaker, putting in lower highs on lighter volume.
The Small-Cap Party Is a Trap
One index refuses to play along.
The iShares Russell 2000 ETF (NYSE: IWM) is an outlier, running to fresh highs while the big tech names get chewed up. It’s up around 4.5% in a month and 21% on the year, the best of the major indexes.
It’s a sign that money is rotating. After five years of tech and semiconductors leading everything, the small caps, loaded with biotech, banks, and REITs, are finally catching a bid.
The pattern I care about is the snap-back.
When the IWM stretches to new highs and pulls away from the pack like this, it can reverse harder than any index on the board. Look at what happened in May…
The IWM tagged new highs, then dropped from 287 to 272. A clean 5% flush, like it was nothing.
When this asset finally stumbles, that violent reversal is the trade I want.
Silver Is Coiling for a Squeeze
Somebody asked me why I keep putting people in the iShares Silver Trust (NYSE: SLV) when the chart looks ugly.
Simple. It’s stretched too far to the downside.
The silver surfer is coiled, and I think the snap-back is coming.
Every night, Asia tries to crush it. Every morning, the Americans come in and buy it right back. Banks like JP Morgan start loading up at the open, and it pops.
Trading is a war between time zones, and the biggest capital market on the planet sits right here in the US. I’ll take the American buyers over the overnight sellers every time.
Silver isn’t just a dollar play, either. It’s the metal that feeds semiconductors and the whole AI buildout. As computing demand climbs, so does the demand for silver.
SLV just broke $55, and I’m rolling my position: selling the contract that expires today and buying into next week.
My target for SLV is $60, and I think it could move 10% to 15% in the days ahead.
Oil Is Bottoming, and Bitcoin Isn’t Done Falling
Oil got wrecked once the Strait of Hormuz scare faded.
Crude now trades below its 50-day, 100-day, and 200-day moving averages.
But I don’t think the world’s geopolitical problems were solved overnight. Thus, I don’t think we’ve seen the last oil flare.
I’m looking to put a swing trade on oil, either the crude ETF or the oil stocks.
Bitcoin is the opposite story.
It’s been bashed, battered, and left for dead. The chart is weaker than oil, with less real utility behind it. I think it can trade down to $40,000, and I might pick up a few coins if it gets there.
The crowd that bought at $120,000 and called it a strategy instead of a trade? They’re in for a rude awakening…
Don’t Fight What’s Coming
Zoom out, and the picture sharpens quickly.
We’ve got a new Fed governor in Warsh, and the market expects him to bring rates down.
I think rates will grind lower into the back half of the year.
Lower rates get the housing market moving again, put money back in Main Street’s pocket, and light the fuse under stocks.
My read on the rest of the year: violent chop through the summer, sharp corrections met with equally sharp rebounds, then a bullish fall. One for the record books.
Trade Small, Wait for the Extremes
My rule for a market like this: stay small.
The chop erodes your edge. Patterns get less reliable, moves are less predictable, and forcing size into this mess is how accounts blow up.
Wait for the extremes instead. Let a chart stretch until the crowd runs out of ammo, then lean against it.
Take the cleaner setups, sit out the ones that don’t line up, and protect your capital until the flows come back.
The big money returns in the fall. When it does, the trends will clean up, and the trades I’ve been stalking, silver, oil, and the small-cap reversal, are the ones I want to be positioned for.
Summer is for staying sharp and staying small.
The fireworks will come later.
Stay Street Smart,
Jeff Zananiri
*Past performance does not indicate future results, Not typical.
