Daily Market Report - Friday, December 20, 2019
Holiday Schedule
Today's Daily Market Report will be abbreviated as I've not included any SECL setups or Movers & Shakers. But first I wanted to pass along our holiday schedule as we need a break too! :-)
EarningsBeats Digest:
There will be no EB Digest articles on Wednesday, December 25th (Christmas Day) or on Wednesday, January 1st (New Year's Day). All other articles will be published as scheduled.
Trading Places blog at StockCharts.com:
I will write Daily Market Reports every day that the stock market is open during the holidays, but will include them at my Trading Places blog, so that I don't need to write multiple articles on a daily basis during the holidays.
Trading Places LIVE shows:
I will host Trading Places LIVE at EarningsBeats.com on Monday, December 23rd, but that will be the last TP Live show until Thursday, January 2nd, at StockCharts TV.
Daily Market Report:
As I mentioned above, I will write a DMR every day the stock market is open (though it may be abbreviated) and publish it in my Trading Places blog at StockCharts.com. I'll likely send an email out to members with a link to that blog article each day.
Weekly Portfolio Report:
No changes. I'll plan to publish this report on Sundays throughout the holiday season.
On behalf of our EarningsBeats.com team, I want to wish you (and all of your families) a very happy holiday season and to thank you all for your support this year. We've gone through a lot of transition in 2019 and your loyalty has meant a great deal to all of us. A great big thank you!!! Please be safe throughout the holiday season!
Executive Market Summary
- Futures were mixed this morning, but the buying has resumed today
- The Q3 GDP (final estimate) came in as expected at 2.1%
- The S&P 500 hit 3225 today, a measurement from the ascending triangle breakout at 3025 in late-October
- Technology (XLK) and healthcare (XLV), two leaders, are leading once again
- Real estate (XLRE) is the weak link
- Our first portfolio stock to test the earnings waters didn't fare well this morning; KMX missed its EPS estimate and is down approximately 6%; failure to hold 90.00 on further weakness could lead to a test of 79 (August low)
- Our alert TPX is down fractionally and we're raising our stop on our remaining shares - see below
Market Outlook
The S&P 500 has made its measurement from its October breakout. Here is a reprint from the chart that was included in the DMR on October 25th:
I don't expect the bull market advance to stop on a dime at 3225, but a pause wouldn't be a horrible thing either. Several weeks ago, I had projected that the S&P 500 would hit 3225 by year end. We're there.
Sector/Industry Focus
We know that technology (XLK) has been on a tear, but one industry group within the sector, electrical components & equipment ($DJUSEC), is on the verge of a massive bullish inverse head & shoulders continuation pattern breakout. Check out this 5 year weekly chart:
A chart like this one simply adds to the current excitement.
Active Trade Alerts
We have one active trade alert currently:
TPX (-0.42%) - reports earnings on February 12. We've begun unloading our TPX position, with 25% sold yesterday. The remaining position will be sold equally at 90.00, 91.00 and 91.80 on any further strength. To the downside, we're raising our stop to any CLOSE beneath the rising 20 day EMA to ensure that we take profits on the balance of our shares.
Earnings Reports
Here are the key earnings reports for this week, featuring stocks with market caps of more than $5 billion. I also include a few select companies with market caps below $5 billion. Finally, any portfolio stocks (or active trade alerts) that will be reporting results are highlighted in BOLD. Please make sure you check for earnings dates for any companies you own or are considering owning:
Friday, December 20:
KMX. Others below $5 bil: BB, WGO
Monday, December 23:
None
Tuesday, December 24:
None
Wednesday, December 25:
None
Thursday, December 26:
None
Friday, December 27:
None
Economic Reports
Q3 GDP (final estimate): 2.1% (actual) vs. 2.1% (estimate)
November personal income: +0.5% (actual) vs. +0.3% (estimate)
November personal spending: +0.4% (actual) vs. +0.4% (estimate)
December consumer sentiment: 99.3 (actual) vs. 99.2 (estimate)
Happy trading!
Tom