Market Action Summary: 11/26/18


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S&P 500 Overview: Direction Uncertain

  • No signs of new leadership groups/bullish narrative. However, extreme bearish consensus could reverse.
  • Political backdrop risky amid G-20, Brexit uncertainty, Mexico uncertainty.
  • Pro-business Republicans marginalized by Trump/Democrats.
  • Periodicity bearish amid second losing month, worst quarter since 2011.
  • S&P 500 at risk below 2700 and broken trend line. Also 2815 double-top.
  • Nasdaq-100 below 7,000.
  • This week may have sideways consolidation, with danger of breaking October lows. Events in focus.

Big Week for Event Risk

  • Wednesday pre-market: GDP revision.
  • Wednesday midday: Powell addresses Economic Club of New York.
  • Friday: G-20 meeting begins in Buenos Aires, finishes over weekend.
  • Mexico border crisis starting to impact markets.
  • But, next week brings ASH biotech conference.

Economic Data Clearly Weakens:

  • Today: Japan Nov factory PMI hits 2-year low.
  • Today: German Nov Ifo misses as outlook sours
  • 11/23: November Euro Zone factory PMI lowest since Dec 2014.
  • 11/23: German GDP has 1st sequential contraction since Q1 of 2015.
  • 11/21: October durable goods miss badly as business investment slows.
  • 11/21: U.S. jobless claims rise more than expected to highest level since June.
  • 11/21: Weekly rail traffic lowest since January
  • 11/21: Consumer sentiment revised down, with stock market apparently weighing on higher-income respondents.

Pratl’s Watch List:

  • (CRM) reports Tuesday night.
  • J.M. Smucker (SJM) reports Wednesday, 11/28, pre-market.
  • Burlington Stores (BURL) reports Wednesday, 11/28, pre-market.
  • Dick’s Sporting Goods (DKS) reports Wednesday, 11/28, pre-market.
  • Big Lots (BIG) reports Friday, 11/30, pre-market.

Russell’s Watch List:

  • WMT holding support around $94.
  • NEE, AMT: Boring stocks that have outperformed, have little global risk.
  • ETSY, DECK: Under-the-radar strong names in retail. JWN may fill gap.
  • AAPL potential hammer today.
  • @CL may get talked higher into OPEC meeting on Dec. 6.
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David Russell is VP of Market Intelligence at TradeStation Group. Drawing on nearly two decades of experience as a financial journalist and analyst, his background includes equities, emerging markets, fixed-income and derivatives. He previously worked at Bloomberg News, CNBC and E*TRADE Financial. Russell systematically reviews countless global financial headlines and indicators in search of broad tradable trends that present opportunities repeatedly over time. Customers can expect him to keep them appraised of sector leadership, relative strength and the big stories – especially those overlooked by other commentators. He’s also a big fan of generating leverage with options to limit capital at risk.