June 23rd, 2025: Trendlines Matter, Headlines Do Not Why Market Noise Doesn’t Change the Bullish Trend

"Performance is important, but Process is critical." - Mike Turner

AT THE BEGINNING OF THIS WEEK:

This morning, the market (S&P & Nasdaq, also known as our TMI... Total Market Index) opened flat. And now we have this week's TMI open. Our next decision point comes at the weekending close and the position of the TMI at the end of this week in relation to the 'Focus Trend-Line', which at this time is the 50-week moving average.

Yes I know about the US knocking out the Iranian nuclear sites over the weekend and all the political hoop-la surrounding the strike. And do I have strong opinions about what took place? Indeed I do. But when it comes to all the activity we witnessed over the weekend, as far as the market goes... it is just noise.

How can you say this, Mike??? The US attacking Iran is going to drive volatility through the roof, some of you are thinking. You could be right, of course and we are prepared for that. If the market closes on Friday down more than -5.36% from its open this week, below the 50-week moving average and a couple of other key indicators, we will go to cash and capture some amazing profits in our current open trade in the S&P 500 and Nasdaq 100.

Otherwise, based on our trend analysis algorithms, we will consider this current bullish trend remains intact and we will continue to ride it as long as it does. Remember... "The current trend in the market will last exactly until it doesn't!" Trendlines matter... Headlines do not.

The easiest way to stop worrying about all the 'what-ifs' is to stop trying to guess what event is going to cause the stock market to change from a bullish trend to a bearish trend. Quit reading what the pundits think is going to happen in the market. Stop watching the stock market news on TV. They all make a living on making you think that they can see into the future... none of them can see into the future... not a single one!

Every week, I give you the chart (below) of the market that shows you the only 4 trendlines that matter... 3, in particular. Look at the red line, the 50-wma, and notice that it continues to trend higher. This is a big deal and as long as it continues to move higher, the market is moving higher. And if the market is moving higher and we are long the market, then our capital is moving higher in value.

This is what matters... period. Everything else is simply noise and marketing!

THE NOISE:

Alex Goodwin, Vice President

The indexes notched their second losing week in a row last week, and while the loss was minor, it marks the first back-to-back weekly losses in nearly 3 months. Tensions between Israel and Iran largely contributed to the decline as investors continued to weight the possibility of an escalating conflict.

The Federal Reserve was front and center with its policy meeting on June 18th. As expected, they held rates steady, but the tone was far from dovish. Chair Powell warned that tariffs and inflation could persist longer than hoped. The Fed’s new dot plot still showed two 25 basis point cuts before the end of 2025, on par with Powell's rhetoric and expectations. As has been the case in several meetings this year, not much market movement followed the uninspiring meeting.

In a significant escalation over the weekend, the U.S. launched airstrikes on three key Iranian nuclear sites Fordow, Natanz, and Isfahan marking its first direct military involvement in the Israel Iran conflict. President Trump described the operation as a “spectacular military success,” claiming the nuclear facilities were “completely and fully obliterated.”. Iran has condemned the strikes and claimed that they were a violation of international law, stating the United States crossed “a very big red line”. Analysts warn that a harsh Iranian response such as disrupting shipping or targeting U.S. assets could reignite sharp market sell-offs, particularly in energy-linked sectors. As of this writing (Sunday morning) no retaliation has taken place.

Last week’s move was insignificant in regard to our exit point, and as always, we are closely monitoring the situation. The significance of the events taking place may well have an impact on the market, but our end-of-week data point will filter out the drama from what’s real, and the decision to exit to cash or stay the course will be calculated on the reality of the trend of the market and not the noise of day.