Referencing history, August didn’t deliver any real surprises for investors who were more inclined to be stock-picking focused, or more centered on sectors than themes, it wasn’t such a bad month. But those who were looking from a top-down perspective… 

I don’t think it’s a stretch to equate the stock market with a prize fighter who takes on contender after contender and wonks every one of them, and that’s what we’ve seen here in August. 

It should come as no great surprise that technical factors are quite mixed as we come to the end of August. This has been a very choppy, erratic and reactive month for stocks… 

Shortly after mid-July when the major market indices hit what were to be short-term peak levels, I cautioned that August could present seasonal and cyclical headwinds. 

The rally in the Nasdaq yesterday — the biggest one so far this month — was encouraging, but it didn’t pierce through the near-term resistance level. 

Generally speaking, net money flow trends are indicating that money is staying in the stock market, but that it is rotating among different categories. 

A more cautious stance was taken after mid-July around the time major stock indexes peaked. 

The AI craze on Wall Street may be dissipating and this is something to watch closely in the coming days and weeks. Numerous stocks in the AI-related theme are showing signs of ebbing upward momentum… 

Yesterday the spotlight was on the traditional cyclicals — a category I’ve been mentioning for some time as an important group to watch in terms of rotational characteristics. 

We are just about at the midpoint of August and it seems the doldrums are setting in on Wall Street; there seems to be little conviction, buying or selling.