July rally may be in store for stocks after weak June, Freedom's Jay Woods says

(PRO Views are exclusive to PRO subscribers, giving them insight on the news of the day direct from a real investing pro. See the full discussion above.) U.S. stocks could be poised for a summer rally if historical trading patterns hold, according to Jay Woods, chief market strategist at Freedom Capital Markets. The S & P 500 was down about 3% in June with two trading days remaining in the month. Woods noted that the benchmark has advanced in July during each of the last eight years following a negative June performance, suggesting the seasonal pattern could provide a tailwind for equities. "We have rallied in July, so maybe this is an omen, but we're watching levels," Woods said. Woods cautioned that technical indicators warrant close attention. He said the index is forming a potential head-and-shoulders pattern and needs to reclaim and hold above its 50-day moving average to maintain bullish momentum. If stocks retreat, Woods said investors should watch the May 5 gap higher around the 7,250 level, which he described as important technical support. .SPX YTD mountain S & P 500, YTD Investors' attention will also turn to this week's employment report. Woods said a reading in line with expectations would likely keep markets focused on inflation and the Federal Reserve's policy path without disrupting the recent rally. …