Stock Market Outlook for August 20, 2025
Market leadership shifting and volatility perking up has investors moving into safe-havens.
*** 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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Boston Omaha Corp. (NYSE:BOC) Seasonal Chart
WisdomTree SmallCap Earnings Fund (NYSE:EES) Seasonal Chart
iShares China Index ETF (TSE:XCH.TO) Seasonal Chart
Stellantis N.V. (NYSE:STLA) Seasonal Chart
TotalEnergies SE (NYSE:TTE) Seasonal Chart
Pure Storage, Inc. (NYSE:PSTG) Seasonal Chart
Lithium One Metals Inc. (TSXV:LONE.V) Seasonal Chart
PHX Energy Services Corp. (TSE:PHX.TO) Seasonal Chart
DiamondRock Hospitality Co. (NYSE:DRH) Seasonal Chart
Matrix Service Co. (NASD:MTRX) Seasonal Chart
Citi Trends, Inc. (NASD:CTRN) Seasonal Chart
NetApp Inc. (NASD:NTAP) Seasonal Chart
The Bank of Nova Scotia (NYSE:BNS) Seasonal Chart
IT Tech Packaging, Inc. (AMEX:ITP) Seasonal Chart
LiveRamp Holdings, Inc. (NYSE:RAMP) Seasonal Chart
Rayonier Advanced Materials Inc. (NYSE:RYAM) Seasonal Chart
The Markets
Stocks slid on Tuesday as traders rotated away from the once hot growth trade in the technology sector and allocated funds towards some of the longer-term laggards. The S&P 500 Index ended down by six-tenths of one percent, quickly retracing its recent breakout move above the 6400 level that has been suspected to act as a cap before the third quarter volatility takes hold. The 20-day moving average (6379) remains a pivotal level on the downside as a violation would suggest the start of the digestion of some of the strength achieved since the April lows. Momentum indicators are showing negative divergences versus price where lower-highs below July’s overbought extremes have been charted for RSI and MACD. The result gives strong evidence of buying exhaustion, once again lending itself to the onset of a digestion of prices aligning with the period of volatility for the equity market. As has been emphasized, this is the time to be on your toes given the well known volatile period that this time of year is known for. As equity markets destabilize from their summer strength, looking for opportunities to peel back risk in portfolios has become appropriate in order to mitigate the erratic moves that impacts stocks in the final months of the third quarter (August/September). The strategy remains to avoid being aggressive in risk (stocks) in the near-term, but take advantage of any volatility shocks (should they materialize) to increase the risk profile of portfolios ahead of the best six months of the year for stocks that gets underway in October. Our list of candidates in the market that are worthy to Accumulate or Avoid continues to be dialed in appropriately, keeping investors tuned into those segments of the market that are working according to our three-pronged approach incorporating seasonal, technical, and fundamental analysis.
Today, in our Market Outlook to subscribers, we discuss the following:
- Loss of leadership in the Technology sector
- Defensive rotation; Consumer Staple stocks catching a bid
- US Industrial Production and the investment implications within
- Manufacturer sentiment
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Sentiment on Tuesday, as gauged by the put-call ratio, ended slightly bullish at 0.90.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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