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Stock Market Outlook for June 12, 2019


Last week’s surge in the number of new 52-week highs may be hinting of the resumption of the longer-term rising trend for stocks.

 

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:

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Fortis, Inc. (TSE:FTS.TO) Seasonal Chart

Fortis, Inc. (TSE:FTS.TO) Seasonal Chart

Sterling Construction Co. Inc. (NASD:STRL) Seasonal Chart

Sterling Construction Co. Inc. (NASD:STRL) Seasonal Chart

Apple, Inc. (NASD:AAPL) Seasonal Chart

Apple, Inc. (NASD:AAPL) Seasonal Chart

 

 

The Markets

Stocks closed essentially unchanged on Tuesday as investors took pause after five sessions of strong returns.  The S&P 500 Index traded within a tight range above its 50-day moving average, highlighting the level below as a point of support.  The 20-day moving average of the large-cap benchmark is starting to curl higher, suggesting a new short-term rising trend.   The hurdle presently hovers around 2830, providing another level of reference below that investors may use to shoot off of in an attempt to maintain strength within shooting distance of the all-time highs. Industrials and utilities were the drags through the session, while consumer discretionary and communications services caught a slight bid.

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Investors continue to play the limits of the massive consolidation pattern on the S&P 500 that peaks around 2950, but one indicator hints of the resumption of the longer-term rising trend.  The number of new 52-week highs on the NYSE spiked last week, surging to the highest level since January of last year.  The number of new highs has been subdued for the past year and a half as gains remained capped by levels of resistance overhead.  A similar prolonged period of depressed 52-week highs was realized in 2015 and 2016, leading to the breakout in the indicator and the equity benchmarks in the spring of 2016.  We’ll continue to monitor the trajectory of American equity benchmarks accordingly.

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While we wait for the breakout of stocks in the US, other benchmarks around the globe are already surpassing their previous peaks.  The Australia All Ordinaries Composite jumped 1.52% on Tuesday to surpass its previous peak just below 6600.  The Bombay Sensex has similarly surpassed resistance around 39,000.  The longer-term trends for each remain that of higher-highs and higher-lows.  Seasonally, while US benchmarks tend to average flat returns during the summer months, the average trend for the Australia and India benchmarks suggest gains into the month of October, outperforming American benchmarks by comparison.  Within the Seasonal Advantage Portfolio that we manage in partnership with Castlemoore, we have exposure to these markets that are typically strong during the summer.  Find out more about our strategy by emailing us at seasonalportfolio@equityclock.com.

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ALL ORDINARIES Seasonal Chart

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BSE SENSEX Index Seasonal Chart

Sentiment on Tuesday, as gauged by the put-call ratio, ended close to neutral at 0.98.

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Seasonal charts of companies reporting earnings today:

Culp, Inc. (CULP) Seasonal Chart lululemon athletica inc. (LULU) Seasonal Chart Neptune Wellness Solutions Inc. (NEPT) Seasonal Chart Oxford Industries, Inc. (OXM) Seasonal Chart RH (RH) Seasonal Chart Tailored Brands, Inc. (TLRD) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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