EB Daily Market Report - Friday, September 3, 2021
Executive Market Summary
- Futures were lower as the market opened as nonfarm payrolls disappointed
- Jobs came in well below expectations this morning, yet we've seen recovery off the earlier lows
- Bitcoin ($BTCUSD, +1.98%) has cleared 50000 again, while etherium ($ETHUSD, +4.11%) is rapidly approaching 4000
- Commodities are mostly higher as silver ($SILVER) jumps 3.7%; crude oil ($WTIC), however, is lower by more than 1% and back beneath $70 per barrel
- Technology (XLK, +0.59%) is today's best performing sector, led by semiconductor stocks ($DJUSSC, +0.91%)
- Docusign (DOCU, +5.45%) is challenging its all-time high after posting better-than-expected quarterly results
- Small caps ($SML, -0.58%) and mid caps ($MID, -0.38%) are lagging the action of their larger cap counterparts to close out the week
Market Outlook
In the cryptocurrency world, etherium ($ETHUSD) remains the best-looking chart, in my opinion, and the choice over bitcoin ($BTCUSD). It held 1750 price support beautifully and its rebound has been much stronger than bitcoin's, despite the latter grabbing all the headlines:
The blue-dotted vertical line highlights the time at which both bitcoin and etherium were testing critical support levels. Since that time, both have bounced, but etherium has been a much better performer.
Sector/Industry Focus
Semiconductors ($DJUSSC) have performed extremely well throughout much of the secular bull market and the group is leading again today. While September can be a rough month, the DJUSSC actually tends to outperform during September as you can see below:
Since 2013, the only month better than September for semiconductor outperformance is May. So leadership today by the group could very well be the norm for the next few weeks.
ChartLists/Strategies
Yesterday, PFE was returned from our Downtrend Reversal scan and it appears as though it may just be beginning another uptrend. I'd consider a stop beneath the recent price low if I traded it:
In bull markets and after uptrends, I look for bullish continuation patterns to emerge. In the case of PFE, it's very early, but could we be starting an uptrend to print the right side of a cup? It's certainly a possibility. If I was trading that possibility, then I'd keep a closing stop beneath 45.25-45.50. My target would be the recent price high between 51-52.
Earnings Reports
Here are the key earnings reports for the next two days, featuring stocks with market caps of more than $10 billion. I also include a few select companies with market caps below $10 billion. Finally, any portfolio stocks that will be reporting results are highlighted in BOLD. If you decide to hold a stock into earnings, please understand the significant short-term risk that you are taking. Please be sure to check for earnings dates for any companies you own or are considering owning.
Friday, September 3:
None
Tuesday, September 7:
PATH, COUP, SMAR, CASY
Economic Reports
August nonfarm payrolls: 235,000 (actual) vs. 740,000 (estimate)
August private payrolls: 243,000 (actual) vs. 693,000 (estimate)
August unemployment rate: 5.2% (actual) vs. 5.2% (estimate)
August average hourly earnings: +0.6% (actual) vs. +0.3% (estimate)
August PMI composite: 55.4 (actual) vs. 55.4 (estimate)
August ISM services: 61.7 (actual) vs. 62.0 (estimate)
Happy trading!
Tom