[su_spoiler title=”Monday-Wednesday’s Action: Apple Breaks Support ” style=”fancy”]
Stocks fell on Monday after Greece’s stock market plunged 20% after being closed for 5 weeks. Apple ($AAPL) sliced below support of its year long base and broke below its 200 DMA line which also weighed on stocks. China’s Shanghai Composite fell another -1.1% after the latest round of economic data was released. China’s official Manufacturing PMI plunged to a five-month low (50.0; expected 50.2) while the Non-Manufacturing PMI beat estimates and rose to 53.9 from 53.8, representing a five-month high. Remember China is an export driven economy and the fact that the manufacturing is falling bodes poorly for the global economy. A slew of commodities continue to plunge on Monday after the softer than expected economic data was released from China. In the US, personal income rose 0.4%, beating estimates for 0.3%. Motor Vehicle Sales rose to 14.2M, beating estimates for 13.6M. Gallup US Consumer spending measure rose to $91, beating estimates for $90. The ISM manufacturing index contracted to 52.7, missing estimates for 53.7. The PMI manufacturing index matched estimates to 53.8. Construction spending unexpectedly slid to 0.1%, missing estimates for 0.6%. Stocks were quiet on Tuesday after China announced more measures to curb short selling in their stock market. In the US, factory orders rose by 1.8%, barely beating estimates for 1.7%. Regeneron Pharmaceuticals ($REGN) gapped higher after reporting earnings. The firm raised its U.S. sales growth forecast for its macular degeneration drug Eyelea. Stocks opened higher on Wednesday as investors digested the latest round of economic and earnings data. Before the open, ADP, the country’s largest private payrolls company, said US employers added 185k new private jobs last month, missing estimates for 210k. The PMI service index rose to 55.7, beating estimates for 55.2. The ISM non-mfg index jumped nicely to 60.3, easily beating estimates for 56.2. In earnings news, shares of Disney ($DIS) gapped down after the company report a strong quarter but investors were not happy with ESPN. First Solar ($FSLR) and Activision Blizzard Corp ($ATVI) gapped up after releasing their latest results.
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[su_spoiler title=”Thursday-Friday’s Action: Market Gets Smacked” style=”fancy”]
Stocks fell hard on Thursday after a slew of big media stocks gapped down as more and more people are cutting the cord. Viacom (VIAB) tanked -14.2% after reporting in-line results on light revenue. Other media stocks were also clobbered on the news. 21st Century Fox (FOXA) slid over 6% even though the company beat on the bottom line. Disney (DIS) plunged over 10% last week after reporting earnings and citing fewer subscribers for their paid ESPN service. Tesla (TSLA) gapped down after the company lowered guidance and lowered the number of cars expected to be delivered later this year. Weekly initial claims rose to 270k, missing estimates for 271k. Stocks fell on Friday after the government said US employers added 215k new jobs in July missing Reuters estimate for 223k. The unemployment rate came in at 5.3% and average hourly earnings rose +0.2%, matching estimates. The report supported the consensus that the Fed may raise rates in September which was a primary “reason” for why stocks fell on Friday.
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[su_spoiler title=”Market Outlook: A Major Top?” style=”fancy”]
Remember, in bull markets surprises happen to the upside. This has been our primary thesis since the end of 2012. We would be remiss not to note that this very strong bull market is aging (celebrated its 6th anniversary in March 2015) and the last two major bull markets ended shortly after their 5th anniversary; 1994-2000 & 2002-Oct 2007). To be clear, the central bank put is the primary driver of this entire 6.5 year bull market and when that ends, we want you to be ready. Until then, the market deserves the longer-term bullish benefit of the doubt. As always, keep your losses small and never argue with the tape.
47.8% Of Stocks in the S&P 500 Are Above Their Respective 50 DMA
(Market Tends To Turn When This Reading Gets Above 70% or Below 40%)
Observation: Readings above 70% usually (not always) correspond with a short-term pullback
Conversely, reads below 40% usually (not always) correspond with a short-term bounce
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[su_spoiler title=”FLS Conviction Leaders List” style=”fancy”]
- AAPL – Broke below important support last week. Will be removed on further weakness
- AMZN – Broke below lows of latest earnings related gap.
- EA – Rallied last week but closed near lower half of weekly range due to market pressure
- FB – Fell for second straight week as it continues to consolidate latest earnings related gap up
- FLT – Rallied last week after reporting earnings. Back above 50 DMA
- GOOG – Tried breaking above a little downward trendline but turned lower on mrkt weakness
- ILMN – Will be removed on more weakness. Fell after reporting earnings
- NFLX – Perfect action continues after HUGE breakaway earnings gap three weeks ago
- SBUX – Big negative reversal on weekly basis. Remains Extended.
- TSLA – Huge gap down last week after reporting earnings. Will be removed on further weakness
- UA – Negative reversal on weekly basis but remains Extended after HUGE Breakaway earnings gap
V – Extended – fell last week and snapped a four week win streak
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[su_spoiler title=”21 New Setups” style=”fancy”]
These hand-picked stocks are carefully selected to help with your idea generation and offer you additional setups each week. The setups are based on our proprietary criteria and offer advanced (dotted line) & classic long and short entry points (solid line). Short patterns are typically mirror images of long patterns.
Note: Please Verify All Earnings Dates/Data from Multiple Sources for Every Stock in all our report(s).
Charts Courtesy of FreeStockCharts.com and/or Stockcharts.com
PNRA Setup – Nice Early Entry Forming
HACK Setup: New Early Entry Forming In Double Bottom Base
CYBR: New Early Entry Forming
PANW: New Early Entry Forming
AVOL Setup: Early Entry Forming
GOOG Setup: Another Early Entry Forming
CELG Setup: Early Entry Forming After Big Earning Gap
CRM Setup: Early Entry Forming
KEY Setup: New Early Entry Forming
eBAY Setup: New Early Entry Forming After $PYPL Spinoff
JPM Setup: New Early Entry Forming
ULTA Setup: Early Entry In Bullish Base-on-Base Pattern
VRSK Setup: New Early Entry Forming After Huge Post Earnings Gap Up
ZBRA Setup – New Early Entry Forming
NOC Setup – Early Entry Forming After Post Earnings Gap
NEOG Setup – New Early Entry Forming After Very Strong Post Earnings Rally
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[su_spoiler title=”Strongest Sectors, Groups, & Symbols” style=”fancy”]
[su_heading style=”modern-1-dark” size=”18″]Strongest Sectors [/su_heading]
[su_heading style=”modern-1-dark” size=”18″]Strongest Groups [/su_heading]
[su_heading style=”modern-1-dark” size=”18″]Strongest Performing Symbols This Year [/su_heading]
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