EB Watch List Update Report

Dear Members: MARKET NOTE: The bulls continue to show resiliency today with all of the major indexes holding recent gains. The move higher earlier in the session on the NASDAQ saw the 20 day moving average cross back above the 50 day for the first time just before the flash crash back on August 24. The NASDAQ also made an attempt yesterday to clear its 200 day moving average, now at 4921, which if successful would be very bullish. The S&P also hit its highest level since August 21 and is now within striking range of its 200 day moving average at 2059. It should be pointed out that stochastics on all of the major indexes are in the mid 90's showing the market is stretched. However RSI's remain below the 70 level which means there is further room to move to the upside if traders remain in a buying mood. Still, there's a lot of "ifs" here as we move even deeper into earnings season which has included some pretty decent haircuts like we're seeing in IBM today with the stock down over 5% on weak numbers. As far as a trading range on the S&P 2059 is likely to result in major resistance should it get there while there should be support between 1995 and 2000 on any selling. Bottom line at the moment is stocks have come a long way off of the August 24 bottom with some major resistance at hand. At the same time the technical picture has improved with traders more inclined these days to buy on the dips rather than sell on moves higher. KEY EARNINGS REPORTS Earnings season is in full sprint mode with some big names reporting today and tomorrow and continuing as the week progresses. Companies reporting earnings today (October 20) include: ACE, BK, CP.TO, CMG, CB, DFS, DOV, FITB, HOG, ILMN, ISRG, LMT, NVR, TRV, UTX, VZ, VMW and YHOO Companies reporting earnings tomorrow (October 21) include: AOS, ABT, AXP, AMP, BHI, BIIB, BA, CSL, CTXS, KO, EWBC, EBAY, EMC, EFX, FBHS, GM, GNTX, KMI, LVS, MAN, NLSN, OC, RJF, RHI, SNDK, SLG, STJ, TXN, TSCO and URI ADDITIONS TO WATCH LISTS: As a reminder we have added 25 new stocks to our Candidate Tracker, all that have beaten earnings expectations. We've also removed some that have earnings reports coming up soon. We're also likely to add quite a few more over the course of the next few weeks as earnings season progressed. Remember that a lot of stocks that beat earnings expectations make strong moves once they've reported and we don't want to chase moves higher. It makes more sense to let stocks settle down and come back to even better entry levels. We will be watching carefully over this week and next week to see which ones present a high reward to risk opportunity to our members and will notify you of new additions to the Watch List. BRIEF COMMENTS ON SELECT WATCH LIST STOCKS: Large Cap Watch List There are no large cap stocks on the Watch List at this time Mid Cap Watch List There are no mid cap stocks on the Watch List at this time Small Cap Watch List VRA - Stock is up over 2.5% today and a close above $13.15 would be bullish. DELETIONS FROM OUR WATCH LISTS: There are no deletions from the Watch List today unless a Watch List stock closes below the stop loss provided. At your service, John Hopkins, EarningsBeats