Stock market uptrend continues, and precious metals start to look really interesting.
This content has been produced by Kvarn Investment Services Ltd, a licensed investment firm supervised by the Finnish Financial Supervisory Authority. The content is intended for informational purposes only and should not be interpreted as investment advice or recommendation. All investing involves risks, and past performance is not a guarantee of future returns.
1. The stock market continues its uptrend.
2. Precious metals prices start to rally.
3. Bitcoin's price continues to move sideways.
As the Kvarn Pulse newsletter returns from its summer break, in this newsletter we examine the stock, crypto, and gold markets using daily charts to provide an overview of how these key markets developed during July and August.
The stock market currently looks quite bullish. The S&P 500 index is trading above all its key moving averages, which are aligned in the classic order required for a sustained uptrend.
We note that after the sharp advance seen at the turn of July and August, the index has not made significant further gains. For now, however, we are willing to write this off as mere "digestion" following a rapid one-off rally.
A notable feature of recent weeks is that the S&P 500 index's rise has not relied on just a handful of mega-caps. This is evidenced by the performance of the equal-weighted S&P 500 index, which has outperformed the market-cap-weighted benchmark.
Below is what we believe might be the most interesting chart in the stock market right now.
This chart illustrates the ratio of the tech-heavy Nasdaq 100 index relative to the broader S&P 500 index (using the QQQ and SPY ETFs as proxies).
From the chart, we can see that the Nasdaq 100 index clearly outperformed the S&P 500 index until mid-June, after which tech stocks underperformed the broader S&P 500 until late July. Over recent weeks, the QQQ/SPY ratio has bounced off its sharpest decline and climbed between its downward-sloping 20-day and 50-day moving averages.
The best clues regarding where the stock market moves next at the index level may come from monitoring this exact ratio. If the Nasdaq 100 index continues its recent strengthening against the S&P 500 index, the broader market is well-positioned to push higher.
Conversely, if the QQQ/SPY ratio turns lower again, it would signal a shift back toward defensive sectors. In that scenario, it seems unlikely that the broader stock market could achieve significant further gains without a meaningful contribution from the technology sector.
As noted above, we consider the QQQ/SPY ratio to be one of the best market barometers right now. Currently, the ratio is sandwiched between its moving averages, making it hard to draw firm conclusions. If over the coming week we see the ratio either cross above its 50-day moving average or drop below its 20-day moving average, these would mark significant pivots in assessing the market's direction.
Right now, the stock market appears well-positioned to continue its upward trajectory. The VIX index, which often signals market nervousness, has fallen below 15, which a quite low level. Over the past two years, readings below 15 have typically been short-lived. The markets currently appear quite calm, providing favorable conditions for the uptrend to persist.
Market breadth also looks healthy. A clear majority of S&P 500 constituent stocks are trading above their 50-day moving average.
Deteriorating market breadth is often one of the first signs of a market peak forming. As long as we see no indications of such deterioration, a continuation of the uptrend seems the most likely path.
Precious metals have been among the strongest performers in recent weeks.
Following a downtrend that lasted from March to July, the price of gold has turned upward once again. The price has already cleared its 10-day, 20-day, and 50-day moving averages. Furthermore, it has risen above its local June peak, leaving only the 200-day moving average above it as overhead resistance.
The price of silver has also turned upward. Unlike gold, however, silver has not quite managed to break above its local mid-June peak just yet.
As an interesting detail, the ratio between the price of gold and the S&P 500 index is closely mirroring last summer's performance. The ratio fell sharply through spring and summer as gold prices dropped and the S&P 500 index climbed, exactly as it did during the same period in 2025.
During the summer, however, the ratio's decline leveled off near the exact same support level where it halted in summer 2025. Almost as if repeating last year's script, the ratio turned back upward in early August.
It will be fascinating to see how far the similarities to last year continue. What is clear, however, is that right now, precious metals look like one of the most interesting asset classes across the broad markets.
The price of the largest cryptocurrency, Bitcoin, has been moving sideways in recent weeks with virtually no discernable trend. Illustrating this lack of trend and minimal price action, the 50-day moving average has drifted flat for several weeks, while the Relative Strength Index (RSI) has remained tightly anchored near the neutral 50 level.
In USD terms, Bitcoin's price performance is essentially neutral. However, if we plot Bitcoin against the S&P 500 index and gold, both ratio charts are currently trading beneath their declining 50-day moving averages. Although Bitcoin's dollar price has not fallen, its relative performance has clearly lagged behind these two asset classes.
For this week's thematic ideas, we highlight two sectors that have turned strongly upward in August.
Global X Lithium & Battery Tech UCITS ETF (LI7U.DE): The price found a local bottom in July at the same level as its March low. Since then, the price has climbed back above its 50-day moving average, and its Relative Strength Index (RSI) has broken above 60, signaling a potential return to an uptrend.
This investment theme performed strongly in autumn 2025, when both precious and industrial metals rallied hard. In recent weeks, we have seen signs of a similar trend re-awakening, and it will be interesting to watch whether lithium gets a boost from general strength in the metals space once again.
As a second interesting theme, we highlight biotechnology. Biotech has gained momentum in recent weeks from broader strength in the healthcare sector. Should investor risk appetite continue to recover, biotechnology, representing the high-beta, higher-risk segment of healthcare, is well-positioned for strong performance.
iShares NASDAQ US Biotechnology UCITS ETF (BTEC) price formed a "higher low" near its 50-day moving average at the end of July and has just broken out to new all-time highs. The theme looks exceptionally strong and appears well-suited for further upside, especially if broader market risk appetite picks up.
The financial markets look remarkably intriguing right now. The stock market continues its upward trend, the technology sector is showing signs of recovery, and precious metal prices have turned sharply higher. Investors currently have opportunities across multiple asset classes and distinct themes. We will continue to monitor the situation and keep you up to date with Kvarn Pulse newsletter, so stay tuned!
The information and sources presented are for illustrative purposes only. While obtained from sources deemed reliable, their accuracy cannot be guaranteed.
The first half of 2026 brought sharp reversals across global markets. In this review, we examine the key developments in stocks, cryptocurrencies and gold, and explore the main factors that could shape markets during the second half of the year.
S&P 500 keeps chopping sideways. Meanwhile, we see crypto market starting to strengthen, with ether leading the market.
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