EB Watch List Update Report

Dear Members: When the market is in full bull mode there will be times when it pulls back, especially when it gets to extremely overbought levels. Now we are seeing just the opposite with stocks rallying after the market got extremely oversold. The NASDAQ is now up 9 of the past 10 sessions; very rare, no matter the market conditions. And the S&P climbed above key resistance just above 2580, getting as high as 2589 before pulling back some with traders wondering if we've just seen a near term market top. And at its peak today the S&P was up by 10% from the December 24 low; that's a heckuva move in such a short period of time. One thing I noticed during this recent bout of buying is the VIX has held the 20 level with traders still questioning if the recent gains can hold. It's certainly possible that after a bit of selling the rally will continue but a 10% rise in stocks in just a few weeks presents a lot of profit opportunities, especially considering the S&P lost 6% for all of 2018. This afternoon we'll get the Fed minutes from the last meeting which could provide further clues on interest rates. Plus there has been a lot of talk lately about some type of trade deal with China. but remember that the market always anticipates what might lie ahead; could we be looking at a sell on the news scenario? It's hard to say but given the non-stop move higher these past few weeks right near key resistance the risk to reward at the moment appears to be to the downside. Companies reporting earnings today (January 9) Before Market Opens: AYI, STZ and LEN After Market Closes BBBY and KBH Companies reporting earnings tomorrow (January 10) Before Market Opens: None After Market Closes: None ADDITIONS TO WATCH First, we are nearing the "official" start to earnings season next week when some big banks report. Once earnings season kicks in we'll start to update the Candidate Tracker which hasn't been updated lately because there really haven't been many companies reporting their numbers. We added PKI to the short list earlier with additional information below. Will keep you posted on any further additions to the Watch List. BRIEF COMMENTS ON WATCH LIST STOCKS SHORTS: PKI - we added PKI to the short list this morning with an initial entry price of $79.34 with a second entry on any rise to $80.25 and a stop of any INTRA DAY move above $81. Just like when we trade on the long side we're keeping a tight stop in case the trade goes against us. LONGS: Large Cap Watch List None Mid Cap Watch List None Small Cap Watch List None Deletions from Watch List None At your service, John Hopkins EarningsBeats