Equity Clock

Stock Market Outlook for February 19, 2021

The trend of oil stockpiles continues to diverge from seasonal norms for this time of year; the trajectory of the trend suggests that the oil market could return to normal by July.

 

 

 

*** 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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American Tower Corp. (NYSE:AMT) Seasonal Chart

Essex Property Trust, Inc. (NYSE:ESS) Seasonal Chart

George Weston Ltd. (TSE:WN.TO) Seasonal Chart

Helix Energy Solutions Group, Inc. (NYSE:HLX) Seasonal Chart

GenMark Diagnostics Inc. (NASD:GNMK) Seasonal Chart

WPT Industrial Real Estate Investment Trust (TSE:WIR/U.TO) Seasonal Chart

iShares JPMorgan USD Emerging Markets Bond ETF (NASD:EMB) Seasonal Chart

iShares Convertible Bond ETF (AMEX:ICVT) Seasonal Chart

iShares Residential Real Estate Capped ETF (NYSE:REZ) Seasonal Chart

SPDR Barclays Mortgage Backed Bond ETF (NYSE:SPMB) Seasonal Chart

CenturyLink Inc. (NYSE:CTL) Seasonal Chart

Peoples Bancorp of North Carolina, Inc. (NASD:PEBK) Seasonal Chart

VanEck Vectors Emerging Markets Aggregate Bond ETF (AMEX:EMAG) Seasonal Chart

Direxion Daily 7-10 Year Treasury Bull 3x Shares (NYSE:TYD) Seasonal Chart

Invesco Preferred ETF (NYSE:PGX) Seasonal Chart

SPDR Wells Fargo Preferred Stock ETF (NYSE:PSK) Seasonal Chart

PIMCO Broad U.S. TIPS Index ETF (NYSE:TIPZ) Seasonal Chart

ProShares Ultra 7-10 Year Treasury (NYSE:UST) Seasonal Chart

 

 

The Markets

Stocks closed mildly lower on Thursday as investors reacted to a weaker than expected report on jobless claims.  The S&P 500 Index slipped by just over four-tenths of one percent, showing hints of rolling over from all-time high territory.  At the lows of the session, the benchmark reached back to levels around short-term support at the rising 20-day moving average, now hovering around 3860.  Buyers were willing to step in at the short-term hurdle as the buy-the-dip mentality remains alive and well.  Intermediate-term support continues to be pegged at the rising 50-day moving average at 3785.  Volume continues to fade compared to levels seen a month ago, as are momentum indicators, both indications of waning buying demand.  MACD has negatively diverged from price over the past few months, typically a precursor event to a pullback.  As noted previously, levels back down to previous resistance at 3550 are fair game and how the chips will be dealt in the short-term is anybody’s guess.  The limits of the short-term rising trading range now hover between 3875 and 3975.

Today, in our Market Outlook to subscribers, we discuss the following:

• Jobless claims and what they say about the health of the labor market
• Oil supply situation in the US and the path to normal
• The price of Oil and the limits of the trading range
• Natural gas fundamentals along with the seasonal and technical status of the commodity
• US Housing Starts

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On the economic front, a report on housing starts was released before Thursday’s opening bell.  The headline print of January’s report indicated that activity fell by 6.0% last month to a seasonally adjusted annualized rate of 1.58 million.  Analysts were expecting that starts would decline by 1.5% to 1.655 million.  Stripping out the adjustments, starts actually declined by 5.1% in January, which is a negative divergence compared to the 0.3% increase that is average for this time of year.  The result follows a solid year for housing starts in 2020, which saw activity increase by 6.6%, firmly above the 2.3% increase that is normal.   We sent out further insight to subscribers intraday, including how to position within our model.  Subscribe now.

Sentiment on Thursday, as gauged by the put-call ratio, ended bullish at 0.82.

 

 

Seasonal charts of companies reporting earnings today:

 

 

S&P 500 Index

 

 

TSE Composite

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