EB Weekly Market Report - Monday, October 19, 2026

Tom Bowley - October 19, 2026

Model ETF Portfolio Draft

Our Model ETF Portfolio ends today at the close. It's been a disappointing finish as our Model ETF Portfolio had outperformed the benchmark S&P 500 rather significantly through most of the quarter. Unfortunately, the timing of the recent AI selloff wasn't great and whether we outperform or not will largely depend on how our major indices close today and what areas show relative strength.

Given that Wednesday of this week starts the worst week of the year historically, we've decided to hold off until Thursday afternoon to announce our Model ETF Portfolio for next quarter. We'll likely enter into those positions at Friday's close, or we might wait until the early part of next week. We'll discuss that at our Model ETF Portfolio Draft, which will be held at 5:30pm ET on Thursday.

ChartLists/Spreadsheets

The following ChartLists have been updated as of the Wednesday, October 14th close, and have been posted to our website:

Strong Earnings (SECL)
Strong Future Earnings (SFECL)
Raised Guidance (RGCL)
Bullish Trifecta (BTCL)
Short Squeeze (SSCL)
Leading Stocks (LSCL)

These ChartLists were updated as of the Friday, October 16th close

Matt's Hot Stocks (HTCL)
Upcoming Earnings (EARN)
Upcoming Earnings Relative Strength (EARNRS)

The Key Manipulation spreadsheet will be updated this weekend through Friday, October 23, 2026. You will be able to view and/or download this spreadsheet from our website when it's completed this weekend.

Weekly Market Recap

Major Indices

Sectors

Top 10 Industries Last Week

Bottom 10 Industries Last Week

Top 10 Stocks - S&P 500/NASDAQ 100

Bottom 10 Stocks - S&P 500/NASDAQ 100

Big Picture

Last week was a rough week for U.S. stocks, especially growth stocks. Still, from the above chart you'd never know it. Again, that's the beauty of it. The great weeks and the awful weeks don't really look any different. The only times we'd be cautious, from a longer-term perspective, are when the monthly PPO and monthly RSI both weaken considerably.....and then break down beneath the zero line and 40, respectively.

Sustainability Ratios

Here's the latest look at our key intraday ratios as we follow where the money is traveling on an INTRADAY basis (ignoring gaps):

QQQ:SPY

Keep in mind that the intraday analysis provided is a "work in progress". I continue to analyze this data to see if it helps provide us clues about calling market direction. It makes common sense to me that it should help in some sense, but it'll require a much longer-term study to determine its worth.

I mentioned last week that it looked like we were seeing a bit of rotation away from technology, and that rotation definitely accelerated last week. I don't view this bearishly, but when this ratio is moving up, I do view THAT bullishly.

IWM:QQQ

Now this ratio is very interesting. The 10-year treasury yield ($TNX) fell back from its recent high of 5.36%, hitting 5.10% to end last week. It is back up a bit this morning, but money appears to be rotating back into the IWM during the day. That's occurring just as the IWM hits key price support at 269-270. Personally, I like the IWM trade (or TNA if you're ok with 3x leverage), but those with low risk tolerance levels should be very careful if the IWM loses 269 closing price support.

XLY:XLP

This ratio remains under pressure, though I wouldn't say it's downright bearish. I would say it's absolutely cautious, however. Consumer discretionary stocks (XLY) did strengthen last week and they're continuing to do so today, which is a positive development. It's going to take plenty more, however to totally right this ship.

XLP 30-Day Cumulative Signal

Based on more than 25 years of back-tested data, I'm not going to consider this signal bearish unless it reaches the 106 level. Every major market downturn this century, other than the COVID pandemic, has seen this signal reach 106.

Here's where this signal currently resides:

Sentiment

5-day SMA ($CPCE)

Sentiment indicators are contrarian indicators. When they show extreme bullishness, we need to be a bit cautious and when they show extreme pessimism, it could be time to become much more aggressive. Major market bottoms are carved out when pessimism is at its absolute highest level.

There's nothing to look at here right now. The 5-day CPCE has moved firmly into neutral territory. Should the selloff escalate at some point, a move higher to .75 or so could mark a significant bottom. Until then, I'll look at other indicators.

253-day SMA ($CPCE)

This longer-term 253-day SMA of the CPCE is our "ocean-liner" signal, unlike our short-term speedboat indicator. Any significant change in direction in this 253-day CPCE, in the past, has had profound effects on the S&P 500.

The longer-term CPCE continues to look for direction, so like it's shorter-term sentiment indicator, this one provides us no market clues at the moment.

Long-Term Trade Setups

Since beginning this Weekly Market Report in September 2023, I've discussed the long-term trade candidates below that I really like. Generally, these stocks have excellent long-term track records, and many pay nice dividends that mostly grow every year. Only in specific cases (exceptions) would I consider a long-term entry into a stock that has a poor or limited long-term track record and/or pays no dividends. I try to review the long-term picture once a month, and below is how I viewed each MONTHLY chart as of Monday, October 5th:

JPM - pulling back with neg divergence, let's watch 20-month EMA at 300
BA - monthly RSI has been between 40 and 60 for 4 years. Enough said.
FFIV - more new highs being reached, bullish
MA - mentioned last month handle could form to 500, just about there
GS - neg divergence suggested caution in Sept and GS fell 10%, watch 830 level
FDX - excellent long-term support from 240-265
AAPL - now slightly overbought, but uptrend is very strong
CHRW - losing 20-month EMA support, so could see drop to 110
JBHT - recent selling should find support/buyers around 215
STX - consolidation continuing after massive rally, remains bullish
HSY - drop below 170 now brings 140 support into play potentially
DIS - every move up for past decade seems to get little follow through
MSCI - very lengthy consolidation, excellent support in 500-520 range
SBUX - 5-year consolidation still in play, need break above 112 or so
KRE - on 2-month losing streak, but still trades comfortably above 20-mo EMA
ED - currently trading in uptrend, near both price support and 20-month EMA
AJG - September reversal lower now suggesting further consolidation ahead
NSC - cup with handle breakout still bullish, but look for 20-month EMA test
RHI - never quite reached 250 resistance, now rolling over again
ADM - hit 2022 resistance, expect downside to 20-month EMA closer to 70
BG - pullback to 20-month EMA looks like solid long-term entry point
CVS - given strong monthly PPO, further selling to 20-day EMA buyable
HRL - monthly pos divergence, which suggests selling momentum slowing
DE - gaining strength and momentum, looks to head higher
LULU - something just isn't right here, no relief; look to 80 for next support
TTD - removing TTD going forward, renewed selling below 13 very bearish
META - challenged all-time high in September, regaining strength
ADBE - 20-month EMA not quite reached, rolling over again
KMB - 115 resistance stalled advance, now looking to hold 90 support
ORCL - held major long-term support at 115, trading on its 50-month SMA
ABBV - strengthening, rising 20-month EMA should continue to offer support
MCD - monthly RSI now under 35, very oversold, could see trip to 210
MKC - breaking below May low with yield now over 4.25%; interesting buy
TSCO - monthly PPO very weak, bounce short-lived, could 20 be possible?

Keep in mind that our Weekly Market Reports favor those who are more interested in the long-term market picture. Therefore, the list of stocks above are stocks that we believe are safer (but nothing is ever 100% safe) to own with the long-term in mind. Nearly everything else we do at EarningsBeats.com favors short-term momentum trading, so I wanted to explain what we're doing with this list and why it's different.

Also, please keep in mind that I'm not a Registered Investment Advisor (and neither is EarningsBeats.com nor any of its employees) and am only providing (mostly) what I believe to be solid dividend-paying stocks for the long term. Companies periodically go through adjustments, new competition, restructuring, management changes, etc. that can have detrimental long-term impacts. Neither the stock price nor the dividend is ever guaranteed. I simply point out interesting stock candidates for longer-term investors. Do your own due diligence and please consult with your financial advisor before making any purchases or sales of securities.

Looking Ahead

Upcoming Earnings

The following list of companies is NOT a list of all companies scheduled to report quarterly earnings, however, just key reports, so please be sure to check for earnings dates of any companies that you own. Any company in BOLD represents a stock in one of our portfolios and the amount in parenthesis represents the market capitalization of each company listed:

Monday: FITB ($46 billion), STLD ($35 billion)
Tuesday: GE ($324 billion), NFLX ($302 billion), RTX ($252 billion), ISRG ($151 billion), COF ($122 billion)
Wednesday: META ($1.88 trillion), TSLA ($1.43 trillion), LRCX ($347 billion), TXN ($255 billion), IBM ($221 billion)
Thursday: PG ($365 billion), UNP ($172 billion), WDC ($133 billion), VLO ($128 billion), SPOT ($110 billion)
Friday: AXP ($212 billion), SLB ($72 billion), INFY ($49 billion)

Key Economic Reports

Monday: October NAHB housing market index
Tuesday: September housing starts, September pending home sales
Wednesday: None
Thursday: Initial jobless claims, September leading indicators
Friday: October consumer sentiment

Historical Data

I'm a true stock market historian. I am absolutely PASSIONATE about studying stock market history to provide us more clues about likely stock market direction and potential sectors/industries/stocks to trade. While I don't use history as a primary indicator, I'm always very aware of it as a secondary indicator. I love it when history lines up with my technical signals, providing me with much more confidence to make particular trades.

Below you'll find the next two weeks of historical data and tendencies across the three key indices that I follow most closely. The percentage for each calendar day represents the annualized return for that day. An example of how this is calculated is reflected next to the first day under the S&P 500 and in parenthesis:

S&P 500 (since 1950)

Oct 19: -131.47% (Ex: cumulative gains =
-28.06% over 54 trading days since 1950. -28.06% x 253/54 = -131.47%)
Oct 20: +89.01%
Oct 21: +58.92%
Oct 22: -89.94%
Oct 23: -7.26%
Oct 24: -22.90%
Oct 25: -42.15%
Oct 26: -60.52%
Oct 27: -19.78%
Oct 28: +124.30%
Oct 29: +75.31%
Oct 30: +51.71%
Oct 31: +10.56%
Nov 1: +47.70%

NASDAQ (since 1971)

Oct 19: -83.58%
Oct 20: +9.07%
Oct 21: +141.22%
Oct 22: -60.44%
Oct 23: -40.59%
Oct 24: -46.21%
Oct 25: -35.55%
Oct 26: -115.08%
Oct 27: -59.60%
Oct 28: +162.80%
Oct 29: +69.43%
Oct 30: +17.62%
Oct 31: +78.75%
Nov 1: +46.72%

Russell 2000 (since 1987)

Oct 19: -18.45%
Oct 20: +57.61%
Oct 21: +32.61%
Oct 22: -41.18%
Oct 23: -45.32%
Oct 24: -56.12%
Oct 25: +1.75%
Oct 26: -13.96%
Oct 27: -127.63%
Oct 28: +187.91%
Oct 29: +62.01%
Oct 30: +6.72%
Oct 31: +123.52%
Nov 1: +7.94%

The S&P 500 data dates back to 1950, while the NASDAQ and Russell 2000 information date back to 1971 and 1987, respectively.

Final Thoughts

There are a few things that I believe are inherently true about the U.S. stock market. First, I do NOT believe that the stock market is random. I believe that the big Wall Street firms know where it's heading, because they control it with massive amounts of capital. Second, I believe the charts provide us directional clues about where the stock market is heading, but more from a longer-term perspective.

Here's what I'll be thinking about and watching this week:

Earnings. Q3 earnings will really begin to heat up this week and next. Now that most of the big banks are out of the way, we can turn our attention to other big market-moving names like GE, NFLX, TSLA, META, LRCX, all of which are reporting their latest quarterly results this week.

Seasonality. Since topping in June, both the NASDAQ 100 ($NDX) and semiconductors ($DJUSSC) have been on a roller coaster ride, taking our portfolios with them. Unfortunately, last week was a painful week for both. There is good news right around the corner, however, from a seasonal perspective. Check out the seasonal history of the NDX since 1985:

The October 27th close vs. the October 28th open is similar to the difference between ice-cold water and scalding-hot water. Seasonal bearishness tends to end almost squarely with the October 27th close, ushering in the most bullish time of the year to be invested in U.S. equities.

Interest Rates. The 10-year treasury yield ($TNX) has been climbing since the beginning of March, providing headwinds for stocks, particularly those that are interest-rate sensitive. While we did get a break last week, the TNX is moving up again today and will definitely be worth watching.

Happy trading!

Tom