You Probably Own July’s Top Tech Lose r

You Probably Own July’s Top Tech Loser

VIEW IN BROWSER

By Michael Salvatore, Editor, TradeSmith Daily

In This Digest:

S&P 500 seasonality points to a strong July…

Lately, I’ve had my eyes glued to the S&P 500 seasonality chart. You’ll see why.

Here’s an updated look. It shows us that the S&P 500 has had a 100% perfect track record of rising from June 28 to July 28 for the last 15 years… with an average return of 3.35%.

That alone is valuable. It gives the bullish bias a little ammunition during what’s generally considered to be a poor period for stocks.

Also notable is that even for the short time we’ve been in this window, stocks have stuck to the script. The average return of holding the S&P 500 from June 28 through July 3 (the day I’m writing this) is 1.06%. From last Friday’s close, June 27, through July 2, stocks are up just under 1%.

Dips through this period are to be bought. Especially as we near the back half of the month.

But we should be wary of the later summer months. From the seasonal peak on July 28 to the trough on Oct. 2, stocks have lost money just over half the time and have returned -1.81% on average.

Once we get to those months, it’ll be time to start looking for the weakest sectors and stocks to trade through this period.

But while the sun is shining, let’s make hay…

As has become one of my favorite monthly rituals, let’s take a look at which of the SPDR S&P 500 sector ETFs is set to provide the biggest returns from now through the seasonal peak on July 28. From the day this publishes, that’ll be the next 15 trading days.

Tech takes it away in June again, with an 86.7% win rate, the highest average trade result (counting wins and losses), and the fourth highest average winning trade result at 3.97%:

Interestingly, the Staples sector also has a high win rate through this period, with a win rate of 80% and solid winning and average trade results.

But let’s stay focused on Tech. As we showed Friday, that’s where the momentum has been for this whole recovery. If there’s evidence that Tech could continue outperforming, that’s especially noteworthy.

Here are the top 10 holdings of the XLK ETF and their seasonal performance through this period over the last 15 years. Most of them have had a good win rate in July:

Shoutouts to Cisco (CSCO), up 14 out of the last 15 years for an average winning trade of 3.69%.

But if you’re looking to reach into areas of the market with lower win rates, but higher reward, definitely look at Apple (AAPL), Salesforce (CRM), and IBM (IBM). All of these stocks have relatively high win rates and post much larger winning returns than CSCO.

It’s interesting to see both Nvidia (NVDA) and Broadcom (AVGO) at the bottom of the pack here. AVGO is positive less than half of the time, and NVDA just a little more than half the time. However, we should note the especially high winning trade in NVDA at 11.6% – skewed higher by the monstrous returns in 2017, 2022, and 2023.

As ever, there’s your blueprint for trading tech over the next few weeks. And as long as you continue to read TradeSmith Daily near the top of each month, we’ll keep bringing you the best seasonal ideas.

These former Wall Street darlings are coming back in style…

Remember genetic editing stocks? Yeah, me too.

Starting back around 2017 and lasting through the pandemic bubble, these names were some of the hottest stocks in the market.

The promise was huge: Gene editing technology could target chronic illnesses, reverse aging, and do all sorts of miracle work on the human body.

Crispr Therapeutics, Editas Medicine, Intellia Therapeutics, and Vertex Pharmaceuticals were all outperforming the S&P 500 back near the late 2021 peak.

Problem was, the promises didn’t deliver. And since then, most of these stocks (Vertex excluded) have completely collapsed.

But let’s zoom in on just this year…

A few of these former darlings are now up big in 2025, with all but Intellia (NTLA) beating the broad market… And that’s despite the biotech ETF trailing:

I can’t quite put my finger on it. Call it a gut feeling. But with all the buzz about crypto, tokenization, robotaxis, robots, and many other highfalutin tech themes, something tells me that these high-tech health stocks will continue to catch a bid.

Anti-aging research is all the rage right now, after all. Just take the ramping popularity of biohacker entrepreneur Bryan Johnson and his supplement business as one piece of proof.

Good news for Johnson: There’s news out of China of a radical and promising new anti-aging breakthrough that we might just start seeing more of.

A major new study published in Cell a few weeks back showed that Chinese researchers were able to reverse signs of aging in primates across areas of brain, organ, and bone function, along with reproductive health.

The therapy involved a new kind of stem cell, senescence-resistant mesenchymal progenitor cells (SRCs), that work to repair DNA damage and effectively turn back the biological clock.

What’s more, the macaques showed no negative side effects over the 44 weeks of monitoring.

I’m not saying to start looking for a bunch of stem-cell-based biotech companies to start springing up and shooting to the moon. This may be about as far out now as genetic editing was 10 years ago.

But keep a close eye on the anti-aging trend and how it’s manifesting in publicly traded companies. Ozempic was just step 1… And more major biohacking breakthroughs will be a huge profit opportunity for investors in the not-so-distant future.

And as for NVDA weakness…

You’ll remember earlier that I called out NVDA’s unusually weak seasonal signal heading into the rest of July.

If you own NVDA, you might look at that as an opportunity to take some profits.

For what you do with those profits, I’d point you over to Louis Navellier.

Louis has been a fan of NVDA since the 2000s. After one of his specific recommendations, in 2016, it’s gone on to deliver gains of roughly 7,000%.

While he thinks it’ll still do well, Louis has made his next big call – a group of upstart AI stocks that could easily outperform NVDA in the coming years.

And that run could start later this month, on President Donald Trump’s upcoming “AI Day.”

Just as he did with Nvidia, Louis is trading this event from the perspective of being a computer guy himself. As a graduate student, he was one of the first to employ quantitative analysis on stocks, using computers the size of a room.

Today we’re back to that type of scale again – and then some… Only now they’re supercomputers.

And the massive physical presence of AI is exactly what Louis has honed in on with his report on the 5 Critical Stocks for “AI Day.”

To prepare you, Louis will be holding a free briefing on the opportunity on Wednesday, July 9, at 8 p.m. Eastern.

Click here to save your seat at the event, where you can gain access to his special report… not to mention the “quant” breakthrough that continues to deliver great trades to this day.

To building wealth beyond measure,

Michael Salvatore
Editor, TradeSmith Daily

(Michael Salvatore held a position in NVDA, NTLA, and AVGO at time of writing.)