Scott Burrill - Market Notes

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Market Note

Anticipating Earnings

Jan 6, 2019

Happy New Year.

Markets are continuing their short-term bounce in Globex, but we must clear and close beyond the risk confluence zones which precipitated Act II at Levels greater than 2575, and ideally 2626.

For now, this remains a Bear Market Bounce until the weight of evidence indicates otherwise. As I've written, and Fed Chair Powell last Friday certainly gave pause to my concern after an asset flush, for credit contagion and liquidity risk, particularly in tightening CDS and the performance of leveraged loans.

For the week, the option implied move in the SP500 is + / - 60 points, or expected boundaries of 2471 to 2591.

The week is filled with many potential catalysts from geopolitical to Fedspeak.

As we anticipate earnings season kick-off and evaluate beyond the headline macro forces driving the indices, since recovery may propagate from the inside out, below I am posting 2 images, the first is a dispersion model of the top stocks from Friday, and the second is a ranking (ranks not shown) of the top 100 stocks in the S&P 1500 with earnings and revenue growth and rising earnings. Exelixis, Regeneron, AMD, Hess, and Apergy were the top ranked securities from my screen. Many other factors influence earnings breakouts, but this is an initial watch list.

Dispersion List

Earnings Initial Watch List

Updated 30-Minute Levels

All the best,

Scott

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