EB Daily Market Report - Monday, September 13, 2021
Executive Market Summary
- Futures were solid to open the week, but after an initial move higher, our major indices have been under pressure
- The action is bifurcated with the Dow Jones and small ($SML) and mid ($MID) cap indices higher, while both the S&P 500 and NASDAQ are lower
- Cryptocurrencies are off to a rough start this week as etherium ($ETHUSD) drops more than 5%
- Meanwhile, crude oil prices ($WTIC) have surged back above $70 per barrel, leading energy stocks (XLE, +2.45%) higher
- Health care (XLV, -0.85%) and technology (XLK, -0.28%) are the two worst performing sectors today
- Many leading growth areas are struggling today as footwear ($DJUSFT, -2.60%) and medical equipment ($DJUSAM, -1.78%) falter
- Leadership on the S&P 500 is concentrated in energy names like APA Corp (APA, +6.61%) and Marathon Oil (MRO, +6.52%)
- On Tuesday morning, we'll get the latest on consumer prices as the August CPI will be released
Market Outlook
Here are key price support levels to watch on the NASDAQ, looking back over the past few months on an hourly chart:
The NASDAQ is testing key initial price support at 15041. A close below that level would open up another 1% move lower to the 14895 support level.
Sector/Industry Focus
Renewable energy ($DWCREE, +5.30%) can move very quickly in both directions. It's not breaking out above price resistance today, although it could be breaking downtrend line resistance:
ChartLists/Strategies
As I mentioned on this morning's Trading Places LIVE show, I'm keeping a very close eye on key gap/price/moving average support levels on the Earnings AD ChartList stocks. As a reminder, these stocks showed very strong accumulation (big hollow candles) the day after reporting quarterly results. Most of these potential accumulation candles were accompanied by very heavy volume as well. Pullbacks to key support levels could present nice opportunities. To balance the possible bullishness on the chart with the upcoming historical bearishness, you might consider simply trading fewer shares to help mitigate risk. Here are 3 interesting stocks to consider:
DOCS:
This is a very volatile (and risky) stock, but is trying to bounce off of its first key price support level near 92. That's also a 14-15% pullback from the recent high. So while it's risky, the reward-to-risk improves with every pullback.
TASK:
TASK has fallen 22-23% since the high above 75 was reached just ten days ago. It's another very risky trade, but one that could provide substantial short-term return. You just have to decide if you're willing to take on that added risk.
CYBR:
I bought CYBR on this pullback today (smaller-than-normal position size), but I want to see it hold 157.94 closing price support. A close back above the 20-day EMA (hammer) would be a bullish short-term reversing candle today.
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.
Monday, September 13:
ORCL
Tuesday, September 14:
FCEL
Economic Reports
None
Happy trading!
Tom