EB Watch List Update Report

Dear Members, KEY EARNINGS REPORTS: Monday: None Tuesday: AA, BOBE MARKET NOTE: The selling today could be the result of the slowing momentum that became apparent on the NASDAQ's 60 minute chart on Thursday or perhaps just some profit taking from the recent pre-Q2 earnings runup. Either way, our major indices are down with further weakness certainly possible. The Russell 2000 is the weakest of our major indices and should find support at its rising 20 day EMA at 1180. The NASDAQ's 60 minute negative divergence, in the meantime, could lead to a 50 hour SMA test to unwind that slowing momentum issue. The 50 hour SMA currently resides near 4414. That would suggest that both indices could see close to 1% more selling before finding key levels of short-term support. ADDITIONS TO WATCH LISTS: There are no additions to our Watch Lists today. BRIEF COMMENTS ON SELECT WATCH LIST STOCKS: Short Watch List: This steady march higher really has made it difficult to profit from any stocks on the short side as our Watch List proves. PRGO - 152.00-153.00 is proving - at least in the very near-term - to be a formidable resistance level. Today's earlier gains have evaporated, leaving a long tail to the top with an intraday high of 155.67. Consider this to be a solid INTRADAY stop if you're shorting PRGO. If this candle holds into the close, I'd be surprised if we didn't see more selling in the days ahead. SBH - the recent closes above the 50 day SMA following the long-term positive divergence makes SBH much more of a long trade technically. Therefore, WE WILL REMOVE THIS ONE FROM OUR SHORT WATCH LIST. Large Cap Watch List: CNP - Residing at a nice entry level on its 20 day EMA for those interested. FDX - Since gapping higher on strong earnings 2-3 weeks ago, today marks the first day where the lows on FDX have penetrated the previous day's low. Further selling could lead to a 20 day EMA test, where I'd be a buyer. FLEX - Closing resistance at 11.35 is a problem until it's cleared. The rising 20 day EMA is support until it's lost. I would expect the 20 day EMA and price support close to 10.80 to hold the bears at bay. HSP - I would expect the nasty long-term negative divergence to eventually send HSP down to test its 50 day SMA and reset that ugly MACD at or near its centerline support. It hasn't happened yet though. JWN - Appears to be on a crash course for 70.21 closing resistance. That's a sell point until it's cleared on a closing basis. Mid Cap Watch List: No significant technical changes on either of our Mid Cap Watch List stocks. Small Cap Watch List: MTRX - Has weakened further and is on the verge of triggering our Final Entry of 31.00. Gap and closing price support is at 31.26 and the price of MTRX, at last check, was 31.32. This isn't a bad level for final entry, but we really need to see this level hold as the bottom of gap support is at 28.35 and we do not want to hold it down to that level. DELETIONS FROM OUR WATCH LISTS: SBH has been removed from our Short Watch List. There are no other deletions today unless closing stops are violated. Happy trading! Tom Bowley Chief Equity Strategist EarningsBeats.com