EB Watch List Update Report

Dear Members, KEY EARNINGS REPORTS: Wednesday: STZ Thursday: None MARKET NOTE: The Dow Jones and Russell 2000 have both failed at key technical resistance levels - the Dow Jones at the psychological 17000 level and the Russell 2000 at its all-time high close of 1209. A breakout above those level would add to the current bullishness, but at least in the short-term those levels are causing traders to reassess their reward to risk trades. ADDITIONS TO WATCH LISTS: There are no additions to our Watch Lists today. BRIEF COMMENTS ON SELECT WATCH LIST STOCKS: Short Watch List: PRGO - Broke through the 145.00 closing stop that we had previously set. At that time, we decided to re-enter a short position at the closing reaction high from late April at 151.43. Today's high of 151.45 triggered that Short Entry, but we are going to keep a very tight closing stop at 153.00. If it clears that reaction high, we won't take any further chances. SBH - A second day of testing its 50 day SMA. An aggressive trade would be to short SBH right here with a closing stop no more than 1% above the current price. The keys from here are (1) does SBH hold rising 20 day EMA support on any selling and (2) does volume accelerate on a breakout above the 50 day SMA? If those two things occur, SBH would likely transition from a short candidate to a long candidate. Large Cap Watch List: CNP - Printed a reversing candle on Tuesday with additional selling today not a big surprise. The rising 20 day EMA would be the next opportunity for entry on the long side. FDX - It's been slow and methodical, but FDX keeps moving higher. FLEX - Failed to hold its breakout above 11.35 into Tuesday's close and that is potentially setting up more short-term consolidation, possibly even weakness. From a bullish perspective, we want to see volume accelerate and price clear 11.35 on a closing basis. Mid Cap Watch List: GRPN - Remains above its rising 20 day EMA and I'd like to see that continue. I wouldn't rule out an intraday move to test 6.40, but otherwise I do expect to see the recent uptrend resume. WTW - Bouncing slightly, but could use much more volume to attract others on the long side. Small Cap Watch List: MTRX - Has been printing mostly lower highs and lower lows over the past 2-3 weeks. The bulls would like to see that change sooner rather than later, although we have our Final Entry about 4% below the current price of 31.33. DELETIONS FROM OUR WATCH LISTS: There are no deletions today unless closing stops are violated. Happy trading! Tom Bowley Chief Equity Strategist EarningsBeats.com