Stock Market Outlook for December 7, 2022
*** Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities. As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends.
Stocks Entering Period of Seasonal Strength Today:
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Theratechnologies Inc. (NASD:THTX) Seasonal Chart
Invesco DB Agriculture Fund (NYSE:DBA) Seasonal Chart
iPath Bloomberg Commodity Index Total Return ETN (NYSE:DJP) Seasonal Chart
Ollie’s Bargain Outlet Holdings Inc. (NASD:OLLI) Seasonal Chart
Nabors Industries, Inc. (NYSE:NBR) Seasonal Chart
Range Resources Corp. (NYSE:RRC) Seasonal Chart
Brookfield Renewable Energy Partners LP (TSE:BEP/UN.TO) Seasonal Chart
Quebecor, Inc. (TSE:QBR/B.TO) Seasonal Chart
The Markets
Stocks closed lower on Tuesday as the typical tax-loss selling/portfolio rebalance period takes a toll on the market. The S&P 500 Index closed down by 1.44%, continuing to pullback from long-term declining trendline resistance that was just tested on Friday around 4070. Horizontal support at 3900 is now being contended with, a hurdle that, if broken, would definitively shift the rising short-term trajectory off of the October low. A sell signal with respect to MACD has now been triggered as the technical indicator crosses below its signal line, an event that was last seen around the heights of the market near the end of August. Similarly, the Relative Strength Index (RSI) is losing its rising path that was seen as being so favourable to the market over the past couple of months. The short-term positive technical backdrop is deteriorating quickly, attempting to once again confirm declining trendline resistance as the peak to any rebound attempt. Below 3900, the first technical target of interest would be the rising 50-day moving average at 3823, followed by horizontal support around 3600.
Today, in our Market Outlook to subscribers, we discuss the following:
- Breakdown below rising trendline support for the large-cap benchmark
- Normal tax-loss selling pressures often leads to enticing Santa Claus rally buying opportunities
- The Volatility Index (VIX)
- US Vehicle Sales and the stocks of Auto makers
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Sentiment on Tuesday, as gauged by the put-call ratio, ended bearish at 1.05.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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