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Stock Market Outlook for July 20, 2021


More and more stocks are trading below their 50-day moving averages, but, as we near an oversold extreme, we have to be prepared to buy.

 

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:

Subscribers – Click on the relevant link to view the full profile. Not a subscriber? Signup here.

Scholastic Corp. (NASD:SCHL) Seasonal Chart

ProShares UltraShort Russell2000 (NYSE:TWM) Seasonal Chart

Allied Properties Real Estate Investment Trust (TSE:AP/UN.TO) Seasonal Chart

Centerra Gold Inc. (TSE:CG.TO) Seasonal Chart

Primerica Inc. (NYSE:PRI) Seasonal Chart

Simmons First National Corp. (NASD:SFNC) Seasonal Chart

ProShares UltraShort MidCap400 (NYSE:MZZ) Seasonal Chart

BRT Apartments Corp. (NYSE:BRT) Seasonal Chart

Artesian Resources Corp. (NASD:ARTNA) Seasonal Chart

iShares 1-5 Year Laddered Corporate Bond Index ETF (TSE:CBO.TO) Seasonal Chart

iShares Core Growth ETF Portfolio (TSE:XGRO.TO) Seasonal Chart

BMO Aggregate Bond Index ETF (TSE:ZAG.TO) Seasonal Chart

BMO Short Provincial Bond Index ETF (TSE:ZPS.TO) Seasonal Chart

iShares CMBS ETF (AMEX:CMBS) Seasonal Chart

DB Gold Double Long ETN (NYSE:DGP) Seasonal Chart

WisdomTree LargeCap Dividend Fund (NYSE:DLN) Seasonal Chart

First Trust Morningstar Dividend Leaders Index Fund (NYSE:FDL) Seasonal Chart

First Trust Dow Jones Global Select Dividend Index Fund (NYSE:FGD) Seasonal Chart

ProShares S&P 500 Dividend Aristocrats ETF (NYSE:NOBL) Seasonal Chart

Schwab US TIPS ETF (NYSE:SCHP) Seasonal Chart

ProShares UltraShort Semiconductors (NYSE:SSG) Seasonal Chart

Vanguard Short-Term Corporate Bond ETF (NASD:VCSH) Seasonal Chart

 

 

The Markets

Stocks dipped sharply on Monday as concerns pertaining to the spread of COVID variants had investors taking down risk in portfolios.  The S&P 500 Index closed with a loss of 1.59%.  Short-term horizontal support at 4250 was been broken intraday and the lower limit of the rising intermediate trend channel is under threat.  The approximately 200-point rising range now sits around 4275 and 4475.  Support at the rising 50-day moving average is keeping the path of higher-highs and higher-lows alive, for now, but for how long is anyone’s guess.  The action on Monday is very typical of the risk-off timeframe/period of volatility that we have just entered.  Following the summer rally period, which peaks on the 17th of July, on average, stocks tend to trade in an erratic manner through the remainder of the third quarter with defensive sectors benefiting at the expense of cyclicals.  We’ve been preparing for this and are delighted with the outcome.  In the Seasonal Advantage Portfolio that we manage in partnership with Castlemoore, we sold off 70% of our equity positions to cash just over a week ago, a shift that we informed subscribers of at the time.  So far so good, but with a long shopping list of pro-cyclical bets that we desire to buy for the fall, we don’t want to be complacent in our defensive bet and look past the opportunities that are being presented.

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

  • Judging how long the market correction may last and the oversold extreme that may warrant buying
  • Tracking the spread of COVID variants against the seasonal norm for respiratory illnesses
  • Notable changes in this week’s chart books, including what was upgraded and what was downgraded

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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.

Subscribe now.

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

 

 

 

Seasonal charts of companies reporting earnings today:

 

 

S&P 500 Index

 

 

TSE Composite

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