EB Watch List Update Report

MARKET NOTE: Dear Members: This has been quite a week for the market. We saw some highly visible companies report earnings, we got the Fed rate announcement, we saw a health bill pass and we got the monthly non-farm payroll report. Any one of these events/reports on their own could easily move the market. Yet the market has gone nowhere. It hasn't gone down but it hasn't gone up either. In fact, for all of March and April and now into May the S&P remains below its all time high. And just when the market is into the month when the pundits say "Go away in May!" Of course that old adage doesn't always work; you always need to assess where the market stands in the present rather in the past. But it is relevant at all times to ask, what's next? It's a valid question because traders always look forward; this morning's jobs report is already history. The VIX continues to catch my attention; it dipped into the 9's for the second time this week, putting it within easy striking range of its all time low; only been there once in history. Many traders see a very low VIX as an all systems go signal; traders are relaxed and ready to put money to work. Other traders see a very low VIX as a contrarian signal; too much complacency signals a reversal is near. I tend to lean towards the complacency camp, especially when we have an overbought NASDAQ and two of the major indexes not far off of their respective highs. For example, the S&P is within 8 points of its all time high with near record trader enthusiasm yet the bulls have been unable to make any progress. Why is this? I'm not sure I have the answer but to me it's not worth getting long here to see if the S&P finally gets to break out level. On the other hand the high level of confidence shown by a near historically low level on the VIX makes me nervous; what if something unforseen comes up out of the blue? I can almost guarantee you a sudden swoop lower would put all stocks at risk. I do have to say that earnings reports overall have been quite strong; that's not insignificant and it might be what keeps the market from selling off hard. But I still think it makes sense to wait and see if the S&P actually does clear its all time high before putting much capital to work as trying to pick up meaningful gains might prove to be quite frustrating and more important, costly. KEY EARNINGS REPORTS Companies reporting earnings today (May 5) include: AC, CI, CTSH, FNMA, JLL, MCO, TDS and USM Companies reporting earnings Monday (May 8) include: AES, AMC, FDC, HTZ, ITT, JCOM, KITE, MAR, NWL, ON, P, POST, SYY, TSO and TSN ADDITIONS TO WATCH LISTS: Will let you know if I find any high reward to risk trading opportunities that would be appropriate in the current market environment. Right now being cautious. BRIEF COMMENTS ON SELECT WATCH LIST STOCKS: SHORTS: LONGS: Large Cap Watch List NVDA - Stock is flat and continues to hold above all key technical levels. It will need to close back above $106.64 in order to resume a move higher. Mid Cap Watch List None at this time Small Cap Watch List DELETIONS FROM THE WATCH LIST None at this time I want to wish eveyrone a restful weekend and I will be back Monday morning with my EB Watch List Update Report. At your service, John Hopkins EarningsBeats