August 1 Market Update | Technical, Fundamental, News
Description:
An analysis for the week ahead.
Points of Interest:
February Gap Zone; Uninspiring Upside Participation; Divergence Between Value And Price; ATH.
Technical:
Broad-market equity indices held onto recent gains, evidenced by the absence of directional surprise.
Recapping last week’s action, on Monday, after the prior week’s action brought the S&P 500 back to its monthly VWAP and $3,190, an area tested multiple times, participants sold the market further to Friday’s most traded price, as is usual, before impulsing higher, through the resting liquidity at $3,230, on upbeat economic news and stimulus hopes.
On Tuesday, the S&P 500 attempted to eat into the poor structure left from the July 23 sell-off, prior to allocating to safety on underwhelming quarterly earnings in the European session. For the remainder of the American session, the S&P traded responsively and lower, with delta, into the close as U.S. fundamental data weakened. Intermediate-term buyer’s remained in control on Wednesday as the S&P walked it’s way higher, albeit on poor structure and participation, as the Federal Reserve reiterated a pledge to support the economy and positive earnings updates.
On Thursday, after a gap down on more dismal earnings data from Europe, the S&P took a shot at some resting liquidity in the $3,200 area, prior to putting in an excess low and trading higher, behind the Nasdaq, to and through a prior low-volume area. On better than expected economic and fundamental releases out of the United States, the S&P continued its trek higher Friday, squeezing into the close, ahead of value.
Despite blow-out earnings, equity indices are showing signs of exhaustion, evidenced by the uninspiring upside participation. Overall, the market appears to be digesting upside moves through time, sending mixed signals to directional traders. Moving forward, attention should be paid to upside follow-through by small-caps, energy, and financials, among other parts of the broader market.
Scroll to the bottom of this document for non-profile charts.
Key Events:
ADP Employment, Challenger Layoffs; Weekly Unemployment Claims; ISM Indices; ISM New York Business Conditions; Construction Spending; Home Prices; Vehicle Sales And Prices. tmsnrt.rs/317t4eG
Fundamental:
S&P 500 companies have beaten earnings estimates at a higher pace. bit.ly/30bgb3Z
Blow-out earnings show tech dominates as 10% of jobs may never return. on.mktw.net/39JFWeQ
ECB extends dividend ban despite banks’ resistance to COVID-19 effects. bit.ly/3fbxdmL
Rates will remain near the zero bound for many years to come. bloom.bg/3giQWCs
As GDP tanked, personal income grew thanks to government support. bit.ly/2Dqqjgl
U.S. specialty stores have been hit hard with downgrades. bit.ly/3hT6Wv4
Fiat Chrysler Automobiles NV (NYSE: FCAU) limits losses, sees better second half. reut.rs/2XiML1N
Ford Motor Company (NYSE: F) to defer quarterly payments on retooling loan. reut.rs/39LsPd2
Outlook for U.S. value stocks looks uncertain in light of cloudy economic picture. reut.rs/2BSqEba
Poll shows global funds favoring bonds over stocks on surging coronavirus infections. reut.rs/39OeTPG
U.S. consumer spending presses ahead; declining income poses challenges. reut.rs/33hoTiQ
Trump to sign an executive ban on TikTok amid pressure on Chinese owner to sell. reut.rs/3k5GWii
China accounts for nearly one-quarter of Tesla Inc’s (NASDAQ: TSLA) revenue. tcrn.ch/312X77a
Microsoft Corporation (NASDAQ: MSFT) in talks to buy TikTok’s U.S. business. tcrn.ch/2XhB2ka
Tech stocks may be growing at the expense of others, or the economy itself. bloom.bg/3feAWzS
Congressional Testimony: Lawmakers question big tech about competition, startups. bit.ly/30ix0d4
Benchmark yield dips; convexity-hedging would accelerate a decline in yields. bloom.bg/3jVbRgW
The public’s view of almost every industry improved since the beginning of the virus. bit.ly/2DhZDOP
Exxon Mobile Corporation (NYSE: XOM) struggles to reverse failed bets. reut.rs/30lv1Fc
Renters owe $21.5B in back rent; Republicans and Democrats fight over relief. reut.rs/337HQVn
Moderna Inc (NASDAQ: MRNA), Pfizer Inc (NYSE: PFE) start COVID-19 trials. reut.rs/2BKFfp4
Big tech must take relative market cap from other sectors to keep growing. bit.ly/2ExGlWc
Fed chief says coronavirus surge is slowing U.S. economic recovery. reut.rs/3jSDOGo
General Motors Company (NYSE: GM) to pay off loan if recovery continues. reut.rs/3gdwFOq
Fed buying spree could move to long end of yield curve, analysts say. reut.rs/3jUwGJB
eBay Inc (NASDAQ: EBAY) classifieds sale not a big hit to revenue. bit.ly/3hATHz4
Intel Corporation (NASDAQ: INTC) guidance and delays are credit negative. bit.ly/3hATHz4
Goldman Sachs Group Inc (NYSE: GS) DOJ investigation remains open. bit.ly/3hATHz4
Hurricane Douglas heads toward Hawaii, threatening losses for insurers. bit.ly/3hATHz4
Virus surge and the expiration of relief measures imperil economic recovery. bit.ly/3hATHz4
August the best month for the dollar and volatility, worst for bonds. bloom.bg/3jP1Bqy
Second COVID-19 wave forces new travel curbs around the globe. reut.rs/2X23MNC
Reported cases and fatalities fell in states hard hit by the coronavirus. bloom.bg/32WEynP
Rural small businesses may not survive another coronavirus shutdown. bit.ly/3f6f0XI
The housing market defies expectations amid economic turmoil. politi.co/2P0be7N
Far more investors are opting to take physical delivery when gold contracts end. bloom.bg/3hKnqG6
Good performance in one period does not predict outperformance in another. bloom.bg/305yM17
The U.S-China cold war would redirect energy flows, alter global supply chains. reut.rs/30UkaRr
China is buying American but not enough to hit the trade deal targets. bloom.bg/3f74krN
Managing the dynamic reduction in the Fed’s balance sheet over time. bit.ly/3gfBuXO
Plentiful evidence that the resurgence of COVID-19 has choked the recovery. bloom.bg/335UNim
Boeing Co (NYSE: BA) slashed production of its biggest twin-engined jets. reut.rs/3hJkclS
Sentiment: 20.2% Bullish, 31.3% Neutral, 48.5% Bearish as of 7/29/2020. bit.ly/330VhEp
Gamma Exposure: (Trending Lower) 2,520,246,115 as of 7/31/2020. bit.ly/2UpgtRE
Dark Pool Index: (Trending Higher) 45.4% as of 7/31/2020. bit.ly/2UpgtRE
Product Snapshot:
S&P 500 (ES):
SPY
SPX
Nasdaq 100 (NQ):
QQQ
NDQ
Russell 2000 (RTY):
IWM
RUT
Gold (GC):
GLD
GDX
Crude Oil (CL):
USO
USL
DBO
Treasury Bonds (ZB):
TLT
Disclaimer:
This is a page where I look to share knowledge and keep track of trades. If questions, concerns, or suggestions, feel free to comment. I think everyone can improve, especially me.
In no way should this post be construed as investment advice.
An analysis for the week ahead.
Points of Interest:
February Gap Zone; Uninspiring Upside Participation; Divergence Between Value And Price; ATH.
Technical:
Broad-market equity indices held onto recent gains, evidenced by the absence of directional surprise.
Recapping last week’s action, on Monday, after the prior week’s action brought the S&P 500 back to its monthly VWAP and $3,190, an area tested multiple times, participants sold the market further to Friday’s most traded price, as is usual, before impulsing higher, through the resting liquidity at $3,230, on upbeat economic news and stimulus hopes.
On Tuesday, the S&P 500 attempted to eat into the poor structure left from the July 23 sell-off, prior to allocating to safety on underwhelming quarterly earnings in the European session. For the remainder of the American session, the S&P traded responsively and lower, with delta, into the close as U.S. fundamental data weakened. Intermediate-term buyer’s remained in control on Wednesday as the S&P walked it’s way higher, albeit on poor structure and participation, as the Federal Reserve reiterated a pledge to support the economy and positive earnings updates.
On Thursday, after a gap down on more dismal earnings data from Europe, the S&P took a shot at some resting liquidity in the $3,200 area, prior to putting in an excess low and trading higher, behind the Nasdaq, to and through a prior low-volume area. On better than expected economic and fundamental releases out of the United States, the S&P continued its trek higher Friday, squeezing into the close, ahead of value.
Despite blow-out earnings, equity indices are showing signs of exhaustion, evidenced by the uninspiring upside participation. Overall, the market appears to be digesting upside moves through time, sending mixed signals to directional traders. Moving forward, attention should be paid to upside follow-through by small-caps, energy, and financials, among other parts of the broader market.
Scroll to the bottom of this document for non-profile charts.
Key Events:
ADP Employment, Challenger Layoffs; Weekly Unemployment Claims; ISM Indices; ISM New York Business Conditions; Construction Spending; Home Prices; Vehicle Sales And Prices. tmsnrt.rs/317t4eG
Fundamental:
S&P 500 companies have beaten earnings estimates at a higher pace. bit.ly/30bgb3Z
Blow-out earnings show tech dominates as 10% of jobs may never return. on.mktw.net/39JFWeQ
ECB extends dividend ban despite banks’ resistance to COVID-19 effects. bit.ly/3fbxdmL
Rates will remain near the zero bound for many years to come. bloom.bg/3giQWCs
As GDP tanked, personal income grew thanks to government support. bit.ly/2Dqqjgl
U.S. specialty stores have been hit hard with downgrades. bit.ly/3hT6Wv4
Fiat Chrysler Automobiles NV (NYSE: FCAU) limits losses, sees better second half. reut.rs/2XiML1N
Ford Motor Company (NYSE: F) to defer quarterly payments on retooling loan. reut.rs/39LsPd2
Outlook for U.S. value stocks looks uncertain in light of cloudy economic picture. reut.rs/2BSqEba
Poll shows global funds favoring bonds over stocks on surging coronavirus infections. reut.rs/39OeTPG
U.S. consumer spending presses ahead; declining income poses challenges. reut.rs/33hoTiQ
Trump to sign an executive ban on TikTok amid pressure on Chinese owner to sell. reut.rs/3k5GWii
China accounts for nearly one-quarter of Tesla Inc’s (NASDAQ: TSLA) revenue. tcrn.ch/312X77a
Microsoft Corporation (NASDAQ: MSFT) in talks to buy TikTok’s U.S. business. tcrn.ch/2XhB2ka
Tech stocks may be growing at the expense of others, or the economy itself. bloom.bg/3feAWzS
Congressional Testimony: Lawmakers question big tech about competition, startups. bit.ly/30ix0d4
Benchmark yield dips; convexity-hedging would accelerate a decline in yields. bloom.bg/3jVbRgW
The public’s view of almost every industry improved since the beginning of the virus. bit.ly/2DhZDOP
Exxon Mobile Corporation (NYSE: XOM) struggles to reverse failed bets. reut.rs/30lv1Fc
Renters owe $21.5B in back rent; Republicans and Democrats fight over relief. reut.rs/337HQVn
Moderna Inc (NASDAQ: MRNA), Pfizer Inc (NYSE: PFE) start COVID-19 trials. reut.rs/2BKFfp4
Big tech must take relative market cap from other sectors to keep growing. bit.ly/2ExGlWc
Fed chief says coronavirus surge is slowing U.S. economic recovery. reut.rs/3jSDOGo
General Motors Company (NYSE: GM) to pay off loan if recovery continues. reut.rs/3gdwFOq
Fed buying spree could move to long end of yield curve, analysts say. reut.rs/3jUwGJB
eBay Inc (NASDAQ: EBAY) classifieds sale not a big hit to revenue. bit.ly/3hATHz4
Intel Corporation (NASDAQ: INTC) guidance and delays are credit negative. bit.ly/3hATHz4
Goldman Sachs Group Inc (NYSE: GS) DOJ investigation remains open. bit.ly/3hATHz4
Hurricane Douglas heads toward Hawaii, threatening losses for insurers. bit.ly/3hATHz4
Virus surge and the expiration of relief measures imperil economic recovery. bit.ly/3hATHz4
August the best month for the dollar and volatility, worst for bonds. bloom.bg/3jP1Bqy
Second COVID-19 wave forces new travel curbs around the globe. reut.rs/2X23MNC
Reported cases and fatalities fell in states hard hit by the coronavirus. bloom.bg/32WEynP
Rural small businesses may not survive another coronavirus shutdown. bit.ly/3f6f0XI
The housing market defies expectations amid economic turmoil. politi.co/2P0be7N
Far more investors are opting to take physical delivery when gold contracts end. bloom.bg/3hKnqG6
Good performance in one period does not predict outperformance in another. bloom.bg/305yM17
The U.S-China cold war would redirect energy flows, alter global supply chains. reut.rs/30UkaRr
China is buying American but not enough to hit the trade deal targets. bloom.bg/3f74krN
Managing the dynamic reduction in the Fed’s balance sheet over time. bit.ly/3gfBuXO
Plentiful evidence that the resurgence of COVID-19 has choked the recovery. bloom.bg/335UNim
Boeing Co (NYSE: BA) slashed production of its biggest twin-engined jets. reut.rs/3hJkclS
Sentiment: 20.2% Bullish, 31.3% Neutral, 48.5% Bearish as of 7/29/2020. bit.ly/330VhEp
Gamma Exposure: (Trending Lower) 2,520,246,115 as of 7/31/2020. bit.ly/2UpgtRE
Dark Pool Index: (Trending Higher) 45.4% as of 7/31/2020. bit.ly/2UpgtRE
Product Snapshot:
S&P 500 (ES):
SPY
SPX
Nasdaq 100 (NQ):
QQQ
NDQ
Russell 2000 (RTY):
IWM
RUT
Gold (GC):
GLD
GDX
Crude Oil (CL):
USO
USL
DBO
Treasury Bonds (ZB):
TLT
Disclaimer:
This is a page where I look to share knowledge and keep track of trades. If questions, concerns, or suggestions, feel free to comment. I think everyone can improve, especially me.
In no way should this post be construed as investment advice.
This is a page where I look to share knowledge and keep track of trades. If questions, concerns, or suggestions, feel free to comment. I think everyone can improve (myself especially), so if you see something wrong, speak up.
