Stock Market Outlook for August 20, 2026
Falling yields at the long end of the treasury curve juicing some reliable seasonal trades for this time of year, while leading to upside exhaustion in another.
*** 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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Stock Highlight: |
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Sprott Funds Uranium Mining ETF (AMEX:URNM) Seasonal Chart |
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First Trust NASDAQ Global Auto Index Fund (NASD:CARZ) Seasonal Chart
WisdomTree SmallCap Earnings Fund (NYSE:EES) Seasonal Chart
iShares S&P Small-Cap 600 Value ETF (NYSE:IJS) Seasonal Chart
SPDR S&P Regional Banking ETF (NYSE:KRE) Seasonal Chart
REGENXBIO Inc. (NASD:RGNX) Seasonal Chart
Snowflake Inc. (NYSE:SNOW) Seasonal Chart
Air Canada (TSE:AC.TO) Seasonal Chart
Citi Trends, Inc. (NASD:CTRN) Seasonal Chart
nVent Electric plc. (NYSE:NVT) Seasonal Chart
Rayonier Advanced Materials Inc. (NYSE:RYAM) Seasonal Chart
Disclaimer: Comments and opinions offered in this report are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered is believed to be accurate, but is not guaranteed.
The Markets
A drop in long-term interest rates following headlines that the Treasury department will interject to bring down the pressure at the long end of the curve worked to support stocks on Wednesday. The S&P 500 Index added two-tenths of one percent, closing the downside gap charted in the previous session and continuing to hold above the consolidation span that the benchmark had been within since the start of June between 7250 and 7620; previous resistance at this upper threshold now turns into support. A short-term bull-flag pattern continues to be charted, suggesting further upside to be expected, although it is looking like a retracement towards aforementioned previous resistance at 7620 will be fulfilled first. The benchmark remains above 20 and 50-day moving averages (~7528), keeping the ball in the bulls court heading through the middle of August. Daily momentum indicators have started to roll over, but they are retaining characteristics of a bullish trend above their middle lines. In the Seasonal Advantage Portfolio that we manage for clients at CastleMoore, we continue to hold an elevated exposure to stocks, aligning with the optimism that the manufacturing economy is expressing. The period of volatility in the equity market through the weeks ahead could start to impose some erratic results (as is presently being seen), but there is some leeway on the calendar before the peak period of weakness rolls around starting in the middle of September. Subscribers can view what we are targeting in our list of market segments to either Accumulate or Avoid.
Today, in our Market Outlook to subscribers, we discuss the following:
- The jump in Pharmaceutical and Biotechnology stocks
- US Housing Starts
- The bottoming pattern on the chart of the Home Builders ETF
- Gold/Miners shining
- Upside exhaustion in the Banks
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Sentiment on Wednesday, as gauged by the put-call ratio, ended bullish at 0.80.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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