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Stock Market Outlook for March 29, 2022


Is the rollover in the net new highs in this market and the stalling of the near-term trend of the advance-decline line signal that the mean-reversion rally is fading?

 

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*** 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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Scientific Games Corp. (NASD:SGMS) Seasonal Chart

Scientific Games Corp. (NASD:SGMS) Seasonal Chart

DCP Midstream, LP (NYSE:DCP) Seasonal Chart

DCP Midstream, LP (NYSE:DCP) Seasonal Chart

Petrochina Co. (NYSE:PTR) Seasonal Chart

Petrochina Co. (NYSE:PTR) Seasonal Chart

Blue Bird Corp. (NASD:BLBD) Seasonal Chart

Blue Bird Corp. (NASD:BLBD) Seasonal Chart

 

 

 

The Markets

Stocks closed higher on Monday as headlines revealed that talks between Ukraine and Russia were showing hope for a ceasefire to the current conflict.  The S&P 500 Index gained seven-tenths of one percent, emerging from negative territory that was held through the middle of the session.  The last level of resistance in the mean-reversion trend over the past couple of weeks has been taken out with the first close above the 100-day moving average since February 9th.  The next level of resistance overhead is the February highs around 4600.  The mean reversion rally into quarter-end continues to impress, but the concern now is that it may be pulling forward some of the upbeat returns that are typical of the first half of April.  This is, obviously, just speculation at present, but a retracement back to levels of support below, such as the 50-day moving average at 4411, would help to rejuvenate momentum to place the trajectory into a more sustainable pace.  While momentum indicators continue to point higher, the MACD histogram has stalled and market volume is becoming mixed (number of net new highs is rolling over and the advance-decline line is showing near-term signs of stalling).  Our desire is to maintain a risk-on bias through the remainder of this seasonally strong period that we had been anticipating between the middle of March and the middle of April, but we have taken some chips off the table, temporarily, as of Monday’s session, just to respect the possibility of the near-term exhaustion to this end of quarter mean reversion move before the new month begins.

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

  • The break of the rising trend on the Volatility Index (VIX)
  • Notable changes in this week’s chart books: Find out what has been upgraded to Accumulate this week
  • US International Trade
  • MSCI World ex-US Index at a critical juncture for the global equity market

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Want to know which areas of the market to buy or sell?  Our Weekly Chart Books have just been updated, providing a clear Accumulate, Avoid, or Neutral rating for currencies, cryptocurrencies, commodities, broad markets, and subsectors/industries of the market.  Subscribers can login and click on the relevant links to access.

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Sentiment on Monday, as gauged by the put-call ratio, ended bullish at 0.88.

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Seasonal charts of companies reporting earnings today:

Micron Technology, Inc. Seasonal Chart lululemon athletica inc. Seasonal Chart McCormick & Company, Incorporated Seasonal Chart Elbit Systems Ltd. Seasonal Chart RH Seasonal Chart PVH Corp. Seasonal Chart Verint Systems Inc. Seasonal Chart Cal-Maine Foods, Inc. Seasonal Chart MillerKnoll, Inc. Seasonal Chart Progress Software Corporation Seasonal Chart Conn's, Inc. Seasonal Chart Sportsman's Warehouse Holdings, Inc. Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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