Equity Clock

Stock Market Outlook for September 23, 2020

US Dollar Index breaking above the neckline of a short-term head-and-shoulders bottoming pattern, threatening the prices of commodities and emerging market equities.

 

 

 

*** 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:

Subscribers – Click on the relevant link to view the full profile. Not a subscriber? Signup here.

Sonoco Products Co. (NYSE:SON) Seasonal Chart

Ameriprise Financial Inc. (NYSE:AMP) Seasonal Chart

Lam Research Corp. (NASD:LRCX) Seasonal Chart

Marathon Petroleum Corp. (NYSE:MPC) Seasonal Chart

NACCO Industries, Inc. (NYSE:NC) Seasonal Chart

 

 

The Markets

Stocks closed higher on Tuesday, continuing to rebound from short-term oversold levels charted in the past few sessions.  The S&P 500 Index gained just over one percent, moving back towards broken support at the 50-day moving average.  Horizontal support around 3250 was tested in the prior session, pulling in investors that were looking to buy the dip.  The 20-day moving average continues to roll over, pointing to a negative short-term trend.  Momentum indicators remain depressed.  Seasonally, stocks tend to remain weak at least until the end of the quarter, which is now just a week away.

The rebound in equities on the session comes despite a breakout in the US Dollar.  The US dollar Index has now broken above the neckline of the bottoming setup, on track to fulfill the target of this bullish pattern back to around 95. 

On the economic front, a report on existing home sales in the US was released during Tuesday’s session.  The headline print of August’s report indicates that activity increased by 2.4% last month to a seasonally adjusted annualized rate of 6.00 million.  The result was marginally better than the consensus analyst estimate that called for a rate of 5.965 million.  The year-over-year change sits higher by 10.5%.  Stripping out the seasonal adjustments, existing home sales actually declined by 6.0% in August, which is weaker than the 2.7% increase that is average for this time of year.  The year-to- date change is now higher by 29.3% through the end of August, which is inline with the seasonal norm.  We sent out further insight to subscribers intraday.  Signup now to receive this analysis.

Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.87.

 

 

 

 

Seasonal charts of companies reporting earnings today:

 

 

S&P 500 Index

 

 

TSE Composite

Sponsored By...