EB Watch List Update Report

Dear Members, KEY EARNINGS REPORTS: Friday: CMA, GS, PNC, SCHW, STI Monday: None Tuesday: ADTN, AMD, ATI, BHI, CA, CREE, DAL, HAL, IBM, JNJ, MS, MTB, NFLX, RF, SAP MARKET NOTE: A strong consumer confidence number has helped to buoy the U.S. equity market, but the selling has been intense of late with increasing expectation of volatility so a bounce was in store. While the reaction higher in equities is providing some relief, we're really not seeing much in the way of dropping volatility expectations as the Volatility Index (VIX) is actually higher on the session. Stay on alert and watch key price support at mid-December and early-January price lows. If those are lost, I'd expect to see short-term selling accelerate. However, with daily RSIs and stochastics near 40 and 20, current prices do reflect strong reward to risk ratios for long entry. ADDITIONS TO WATCH LISTS: There are no additions to our Watch Lists today. Many stocks will be removed from our Watch Lists in the next couple weeks as their earnings reports near. We'll also be replacing them with stocks that show superior results and strong technical reactions. BRIEF COMMENTS ON SELECT WATCH LIST STOCKS: Short Watch List: There are no Short Watch List stocks at this time. Large Cap Watch List: ADBE - Downtrending currently, but loved the reversing candle on Wednesday. Needs to reverse from here. RAX - 50 day SMA test is significant as the recent selling has now reset the daily MACD back to centerline support. Slowing momentum issues have been resolved. V - Volume trends are strong and V hit gap support near 252 earlier. Good reward to risk entry point here. Mid Cap Watch List: MLNX - Consolidating within possible handle. MLNX clearly needs a high volume breakout on a closing basis above 46.75. That would be very bullish. ODP - With 20 day EMA now serving as resistance and rolling over, look to gap support near 7.45 for near-term support. TASR - Been a great performer, but a close beneath 25.00 could lead to a short-term drop to 23.00-23.25. VDSI - Triggered second entry at 21.50 today. This is a solid reward to risk entry point. Small Cap Watch List: QLGC - 20 day EMA test today represents nice short-term entry. DELETIONS FROM OUR WATCH LISTS: There are no deletions today unless closing stops are violated. Happy trading! Tom Bowley Chief Equity Strategist EarningsBeats.com