Stock Market Outlook for June 1, 2022
The S&P 500 Index has lost 0.4%, on average, in the month of June over the past two decades with gains more common than losses at a ratio of 3 to 2.
*** 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.
Hawkins Chemical, Inc. (NASD:HWKN) Seasonal Chart
Prothena Corp. (NASD:PRTA) Seasonal Chart
INTL FCStone Inc. (NASD:SNEX) Seasonal Chart
The Markets
Stocks slipped in the final session of May as traders conducted their closing trades for the month. The S&P 500 Index shed six-tenths of one percent, charting a rather indecisive doji candlestick around horizontal resistance at 4150. The next level of resistance overhead remains 4280, approximately representing the declining 50-day moving average and corresponding to the neckline of the ominous head-and-shoulders topping pattern overhead. The 20-day moving average is now in a position of support at 4035 following last week’s breakout. Despite the snap-back in stocks in the past week, this market still has much to prove in order to move past the dominant trend of lower-lows and lower-highs that has been intact on an intermediate-term basis since the year began. The 50 and 200-day moving averages are still pointing lower, threatening to cap this rebound attempt. While we have been positioned to take advantage of the recent rebound via ramped up equity exposure in the Super Simple Seasonal Portfolio and “Neutral” industry ratings (from Avoid) within our chart books, there is still much more work that is required in order to suggest that the path of least resistance in this market is no longer lower, but rather something conducive to be bullish of over a longer-term timeframe. We could still get there within the next few weeks as we prepare for the mean-reversion/summer rally period for the broader market.
Today, in our Market Outlook to subscribers, we discuss the following:
- Monthly look at the large-cap benchmark
- Average tendency for the equity market in the month ahead
- Notable ratings changes in this week’s chart books: Find out what we have upgraded to Accumulate this week
- The change in home prices in the US
- Canada GDP and the TSX Composite
Subscribe now and we’ll send this outlook to you.
For the month ahead, while June has not traditionally been a strong month for stocks, it is a classic mean reversion month and it also sees the start of the summer rally period that runs into the start of the third quarter. The S&P 500 Index has lost 0.4%, on average, in this sixth month of the year over the past two decades with gains more common than losses at a ratio of 3 to 2. Returns have ranged from a loss of 8.6% in June of 2008 to a gain of 6.9% in June of 2019. We break down everything that you need to know for the month ahead in our recently released monthly report for June. Subscribers can look for this report in their inbox or access it from the report archive at https://charts.equityclock.com/
Want to know which areas of the market to buy or sell? Our Weekly Chart Books have just been updated, providing a clear Accumulate, Avoid, or Neutral rating for currencies, cryptocurrencies, commodities, broad markets, and subsectors/industries of the market. Subscribers can login and click on the relevant links to access.
Subscribe now.
Sentiment on Tuesday, as gauged by the put-call ratio, ended close to neutral at 0.96.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
| Sponsored By... |
|
