The Shakedown 7-12-20

LAST WEEK, S&P 500 (+1.72%):

Monday: +1.54%

Tuesday: -1.03%

Wednesday: +0.76%

Thursday: -0.57%

Friday: +1.04%

Who had a worse week Will Smith or Wayfair? I digress....

Last week, with the SPY struggling at the top end of its range, we were wondering whether or not we'd get a pull back or if we would see healthy digestion via sideways action. We saw some weakness Thursday morning which was gobbled up by some afternoon strength which continued into more buying Friday. The buyers are proving they are still in control by not allowing that Thursday pull-in to turn into anything dramatic to the downside. It turns out, the broad market got that healthy consolidation it so badly needed.

While I was in the camp the market was ready for a pullback due to an overbought Nasdaq, I was proved wrong with the completely healthy action we saw towards the end of last week. There is no reason this market can't continue higher from here judging by the way so many charts are setting up.

Earnings season is upon us folks. We have the banks to kick us off, NFLX Thursday and then it gets a whole lot more fun beginning next week when other sectors begin reporting. Many bank stocks have really nice charts to setup for a move higher, but with them all set to report earnings this week I'll lend my focus elsewhere until after their reports.

Tons of charts setting up out there with the strong market as well as the SPY breakout setup.

Earnings Season Kickoff

Click the above picture for a full list of the companies reporting this week

IPO market has been so hot. Going to keep an eye on a few names going forward

nCino debuts this Tuesday under the ticker NCNO and this company has been super hyped. Cloud based fintech company for banking. Like this one a lot. They're priced at 29 but I'd expect it to open much higher with the demand they're citing. 7.6 million share float so it will trade pretty thin and will be able to go up and down dollars pretty rapidly.

GoHealth debuts this Wednesday under the ticker GOCO. This company is a digital portal to help consumers select insurance products. 39.5 million share float so this one will be much more liquid than NCNO.

LEN Long

All the homebuilders are so strong and setting up for a breakout this week with LEN, DHI & TOL all looking like want to rip. When the whole sector is setting up it usually means they want to go higher en masse.

With earnings out of the way, we have all the time in the world to fully squeeze the juice out of this breakout setup. Would love to see some big volume take out the 66 resistance level. 

Trigger: $66

Stop: $62.89

Target: $75-78+

Hope to see you in the chat Monday!

Watchlist coming in the following email.


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