Trading Insights 07/02/25

Chart of the Day 📈 7/2/25: You Want Rotation? You GOT Rotation!

Mike Larson | Editor-in-Chief

You want market rotation? Yesterday, you GOT market rotation. In a BIG way!

Yes, it’s only the first trading of a new quarter and new half-year. So, we can’t make too much of it...yet. But take a look at the MoneyShow Chart of the Day here – courtesy of our friends at Bespoke Investment Group.

They cut the Russell 1000 Index into 10 slices of 100 stocks. Then they looked at how the worst 100 and best 100 performers in the second quarter performed yesterday. Through midday, the worst 100 surged an average of 3.3%. The best 100 dropped 2.3%. Big Tech slumped. Small caps surged.

It’s like the cool kids all got shut out of the cafeteria for a day – and everyone else got to sit at their lunch table for a change. But does it MATTER?

Well, everyone likes to look for new potential winners when the calendar shifts – as it just did from H1 to H2. Those moves can be the start of something. But they can also fade pretty quickly. It’s simply too soon to tell.

You COULD argue that the Senate’s passage of the “One Big Beautiful Bill” yesterday will help support the US economy and US-focused companies. Or at least, give traders a fundamental “excuse” to switch horses for a while. But again, it’s early.

Bottom line? I’d watch…but not make wholesale shifts here. I’ve already advocated investing in other groups beyond big tech anyway – including those as varied as gold miners and financials. They did just fine during Tuesday's "great rotation." I think the same will hold true for other “Be (Selectively) Bold” assets.

By the way, you can catch Paul Hickey of Bespoke at our 2025 MoneyShow Masters Symposium Las Vegas, which is right around the corner July 15-17. And you can ask him yourself what the rotation “means” – if it really gathers steam by then!

Finally, I wanted to wish you and your family and friends a very happy Fourth of July holiday! Since US markets will be closed on Friday, there will be no Trading Insights newsletter. Look for your next issue on Monday, July 7.

Miller: This is the Single MOST Important Trait Successful Traders Possess

What’s the single most important trait that successful traders possess? It may NOT be what you think! See what Darren Miller of Psychtrader had to say in this MoneyShow “vault” video excerpt.

• QQQ: Why Monthly Charts Can be a Trend Trader's Best Friend
  👉️ TICKERS: SPX, QQQ

  Over many years in the market, as a trader and an investor, I've learned the hard way that you can't cheat the system. It doesn't work that way. But I have made one discovery. And it begins with what we know to be true about the behavior of asset prices: Asset prices trend, explains JC Parets, founder of TrendLabs.

• IVV Vs. RSP: How Do Cap-Weighted and Equal-Weighted Funds Compare?

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  Some people think of ETFs as totally passive investing. But let’s take a closer look at that premise – using the iShares Core S&P 500 ETF (IVV) and the Invesco S&P 500 Equal Weight ETF (RSP) as examples, highlights Jim Van Meerten, analyst at Barchart.

🎲 Level up your investing game at the ‘25 MoneyShow Masters Symposium Las Vegas (July 15-17) at Caesars Palace. Register now!