Strong Market, Healthy Pullback, and What I’m Watching Next

July 8, 2025

Hey Traders,

Let’s start with the big picture.

SPY just hit a fresh 52-week high — and while that’s a good sign, it’s not the whole story. Because if you zoom out and look at the last 6 months, you’ll see something interesting…

Back on April 2 — what Trump called Liberation Day — we saw a steep market pullback.

That’s the day Trump put tariffs on just about everything. Markets dropped hard across the board.

Some stocks recovered faster than others… and some didn’t recover at all.

Now here we are in July, with SPY at a new high again — and I’m expecting a bit of a pullback.

I wouldn’t be surprised to see price drift back down toward the short-term trendline — the green trendline on my chart.

That’s not bearish… it’s just how strong markets cool off.

When I Might Buy a Put

Now even though I’m not worried, this is exactly the kind of moment when I’ll sometimes buy a Married Put.

If you haven’t heard me explain this before, here’s how it works:

A Married Put is when you buy a stock (or already own it) and buy a put option at the same time.

That put gives you the right to sell the stock at a certain price.

So if the stock tanks, you’ve got a built-in floor.

If the stock rallies, great — the put just expires worthless and you keep the upside.

It’s exactly like buying car or home insurance — you hope you don’t need it, but if you do, you’re glad you bought it.

I only use it when I think a stock’s made a big run and might be due for a breather.

But I’m picky. I won’t do it on a weak stock. Only on a name I’d be happy to hold — even if it pulls back.

What Held Up on Liberation Day?

Here’s one of my favorite tricks:

Go back to April 2 — that selloff I mentioned?

Instead of just looking at what fell, I go hunt for what didn’t fall.

If a stock held up strong while the whole market was dropping, that stock is showing strength in a weak market. And I always want to know which names have that kind of backbone.

So here’s what I did…

I scanned for stocks that:
✔ Are hitting new highs
✔ Didn’t massively drop during the April 2 pullback
✔ Are now showing a strong upward trend

And here are some of the names that popped:

AHR – Didn’t even experience much of the Liberation Day pullback.
APH – Nice strong chart.
CVNA – Taking off and showing strength.
CWEN – Dropped during Liberation Day, but quickly recovered and has been strong.
DRS – Another one that quickly recovered.

Not every one of these is a trade just yet — but they’re all showing the kind of behavior I like to see when I’m building my watchlist.