"A 2% Trading Range That Could Define Your Next Two Months"

KR Opinion

Looking back on last week's market activity, we witnessed a continuation of the upward trend that has been pushing markets toward new highs. The longer-term technical and fundamental aspects of the market remain positive, and based on current momentum and underlying strength indicators, we could potentially reach the 7030 level or even higher by the end of this year or in early 2026. This represents significant upside potential from current levels and suggests that the broader bull market remains intact, despite any near-term fluctuations we may experience.

Currently, we're seeing some consolidation at these high levels, which is a normal and healthy sign after a period of gains. This phase of consolidation could develop into a sideways trading range of about 2% over the next few weeks. This means the market might fluctuate within a relatively narrow range, rather than making strong moves up or down. Such periods of consolidation often serve as a digestion phase, during which the market absorbs recent gains and prepares for the next directional move.

The technical database, which tracks market internals, showed some encouraging progress on the intermediate timeframe, suggesting that beneath the surface, there is still considerable underlying strength in the market structure. The sector rotation patterns have remained fairly positive, maintaining the constructive tone we've been observing. However, it's worth noting that we haven't seen an expansion into new sectors leading the charge. Instead, what we're experiencing is somewhat of a narrow rally, where gains are driven by a limited number of stocks or sectors rather than broad-based participation across the entire market.