News:
On Wednesday, the market saw selling in almost every sector. All 4 of the major indexes closed the day lower…
- Dow Jones -0.1%
- Nasdaq -1.5%
- S&P 500 -0.8%
- Russell 2000 -1.9%
The stock of the day was Target (TGT) which shed 13% or $10.5 billion in market cap after an earnings miss.
- Executives blamed “a significant change in consumer shopping patterns.”
- Notably, Walmart (WMT) surged 7% over the past two days after reporting earnings and beating expectations.
- Broadly, retail sales increased by 1.3% in October,
Your take home, some are reaping the profits while others are left behind.
Sector Round Up
Most, 9 of 11, sectors ended the day lower. The winners…
- Utilities (XLU) +0.9%
- Consumer Staples (XLP) +0.5%
At the bottom…
- Energy (XLE) -2.0%
- Consumer Discretionary (XLY) -1.5%
- Technology (XLK) -1.4%
Republicans Take Control—Of The House
Futures moved higher overnight after. As the NY Post put it, “Republicans eke out House majority after four years out of power.”
- Congress will be divided when it convenes in January
- This was widely expected and all but priced in.
At writing, futures are lower but not significantly.
Technicals:
We’ve got some divergence in our main signals.
The VIX moved lower yesterday after facing strong resistance at 25. This is bullish.
But the Put-to-Call Ratio surged higher on Wednesday, 42% higher to be exact. It’s now grossly oversold…
- The bears are now placing bearish bets.
- The excessive number of short positions could set up another epic short squeeze.
Meanwhile, RSI levels are all neutral.
Our outlook remains bullish, although we do not see the right risk-reward for a short-term options trade.
For now, we are holding our positions and monitoring the signals closely…
Timing:
The latest unemployment filing number drop at 8:30 this morning.
We believe a strong labor market will continue to shore up the frail economy.
Watchlist:
*Low Float
^Open Position
*NINE on watch
CRTD resistance at $1.50
PDSB on watch
CABA on watch
FDMT on watch
IMMR support at $6.25
^IMVT support at $13
WNC resistance at $25, support at $24
ELF support at $52
GLYC on watch
MGNX support at $6.50
^CROX support at $80/85, resistance at $100
^RYAM support at $7
EYE support at $38
PRVB support at $8
OII support at $14
IGT support at $24
SFM resistance at $34
MGNI support at $10, resistance at $12
ADMA support at $2.85
VVNT on watch
MNSO support at $9
GILD support at $80, resistance at $84