The Bear’s got a heavy claw in the action with S&P 500 price action back under 1,900.
Sell Bias holds – as it has for months.
We’re trend down, below the major moving averages, with hardly any leadership to look to.
A collapse in the FANG group (Facebook, Amazon, Netflix and Google), say large market players may be taking risk off.
We’re seeing strength in safer vehicles, such as Treasuries, Utilities and Consumer Staples.
Multiple accumulation days off the lows have registered legit follow through for a potential bottom to have been placed. Though without leadership, it’s likely to have been from a rebound in Energy names as well as the above mentioned safety names.
Growth stocks mentioned here recently are a rare pocket of strength.
An elevated Oil Volatility Index isn’t good enough reason alone to short crude. However, it’s tough to be a true bull as this measure of fear in that market warns.
Back to back accumulation days on the S&P 500 gives the Bull some momentum going into February. It’s mostly been energy stocks bouncing off lows, so we won’t get too excited. Yet a broader bounce is still very much in play.
Bias stays with the Seller at this juncture.
Only TAL Education Corp. (XRS) meets our strict screen for top quality stocks.
However, we are seeing some other decent names setup:
Store Capital Corp. (STOR), a commercial REIT, has shot up an easy 10% since mentioned here last weekend.
Ollie’s Bargain Outlet (OLLI), a discount retailer, also holds great potential as it carves the right side of a base.
Same goes for Empire District Electric (EDE), an electric utility.
Encouraging breakouts from: SERV, DLR.
Success from the above ups the odds for the attractive technical bases from ISRG, WEC and ITC.