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Stock Market Outlook for January 10, 2019


Equity benchmarks looking at a critical test overhead.

 

Real Time Economic Calendar provided by Investing.com.

 

*** 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:

Target Corporation  (NYSE:TGT) Seasonal Chart

Target Corporation (NYSE:TGT) Seasonal Chart

Dril Quip, Inc. (NYSE:DRQ) Seasonal Chart

Dril Quip, Inc. (NYSE:DRQ) Seasonal Chart

Shoe Carnival, Inc. (NASD:SCVL) Seasonal Chart

Shoe Carnival, Inc. (NASD:SCVL) Seasonal Chart

PDC Energy, Inc. (NASD:PDCE) Seasonal Chart

PDC Energy, Inc. (NASD:PDCE) Seasonal Chart

Cineplex (TSE:CGX) Seasonal Chart

Cineplex (TSE:CGX) Seasonal Chart

Wal-Mart Stores, Inc.  (NYSE:WMT) Seasonal Chart

Wal-Mart Stores, Inc. (NYSE:WMT) Seasonal Chart

Total SA (ADR) (NYSE:TOT) Seasonal Chart

Total SA (ADR) (NYSE:TOT) Seasonal Chart

Pengrowth Energy (TSE:PGF) Seasonal Chart

Pengrowth Energy (TSE:PGF) Seasonal Chart

 

 

The Markets

Stocks closed higher for a fourth straight session on Wednesday as investors continue to digest news pertaining to the trade negotiations and the stance of of the Fed following the release of the latest FOMC minutes.  The S&P 500 Index added four-tenths of one percent, moving into a range that will be a critical test for the large-cap benchmark.  Following the break of the consolidation range between 2600 and 2800, a flood of selling pressures overwhelmed market indices into the back half of December, eventually hitting the significant low on December 24th.  A range of between 2580 and 2630 presents a probable reaction zone where the power of the rebound will be confirmed.  A rejection from this zone is likely to coincide with a move back towards the December lows as those investors that were trapped following the December breakdown look to trim exposure around that breakdown point.  The range also comes close to intersecting with the benchmark‚Äôs declining 50-day moving average, a critical hurdle in the intermediate path of the benchmark.  The damage to the technicals and the severely tarnished sentiment suggests that a retracement of some magnitude is probable. 

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On schedule for the Wednesday session, the Energy Information Administration (EIA) released the petroleum inventory status for the week just past. The EIA indicated that oil inventories decreased by 1.7 million barrels last week, while gasoline recorded an injection of 8.1 million barrels. Distillates also realized an outsized increase of 10.6 million barrels, the second highest weekly injection on record. The result elevated the days of supply of gasoline to 27.6 from 26.5 previous and distillates to 36.7 from 30.8 previous. Oil was essentially unchanged at 25.1 days of supply. For gasoline, the days of supply matches the highest level for the start of the year in the past 20 years, suggesting a renewed supply glut with respect to product inventories. The average level of days of supply for oil and gas at the start of the year is 21.8 and 24.9, respectively. Typically, the end of the year can see fluctuations to inventories, such as this, but the results this year appear to be well outside of seasonal norms.  Subscribers to our service were informed in the back half of December that the price of Oil was undervalued in the $40 range and since that time the price of the commodity has bounced aggressively.  To receive updates, such as this, directly to your inbox, simply subscribe via the following link: https://charts.equityclock.com/subscribe

Weekly U.S. Days of Supply of Crude Oil excluding SPR  (Number of Days) Seasonal Chart

Weekly U.S. Days of Supply of Total Gasoline  (Number of Days) Seasonal Chart

Sentiment on Wednesday, as gauged by the put-call ratio, ended bullish at 0.93.

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Seasonal charts of companies reporting earnings today:

FuelCell Energy, Inc. (FCEL) Seasonal Chart Synnex Corporation (SNX) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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