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Scott Martindale  

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  • Bulls Retake The Wheel, With A Little Help From Their Friends At The Fed
    Mon, Mar. 23 AAL, AMG, ICE 1 Comment

    Summary

    • It didn’t take long for the bulls to jump on their buying opportunity, with a little help from the bulls’ friend in the Fed.
    • Despite huge daily swings in the market averages, trading actually has been quite rational, honoring technical formations and support levels, selling overbought conditions and buying when oversold.
    • Looking at the charts, stocks are once again poised to challenge all-time highs. The recent pullback served to refresh bullish conviction, as expected.
    • Overall, this week’s fundamentals-based Outlook rankings still look bullish to me, with economically-sensitive sectors Tech, Financial, all-weather Healthcare, and Industrial comprising the top four.
    • Our trend-following sector rotation model retains a bullish bias and suggests holding Financial, Technology, and Industrial sectors. Also discussed are alternative ETFs and individual stock ideas.
  • Investors Find A Reason To Sell, Teeing Up A New Buying Opportunity
    Mon, Mar. 9 AAPL, BBT, CAR 3 Comments

    Summary

    • Last week’s market was dominated by those looking for a reason to sell, and so they did. Good news in jobs report spooked investors into thinking rate hikes are imminent.
    • However, when markets are overbought and hitting new highs on declining volume, investors look for any catalyst to take profits. But all signs point to more upside.
    • From a technical standpoint, this sudden bout of weakness is healthy, testing support and bullish conviction, and the chart remains bullish in the mid and longer term.
    • Overall, this week’s fundamentals-based Outlook rankings look solidly bullish to me, with economically-sensitive Tech, Financial, Industrial, and all-weather Healthcare making up the top four.
    • Our trend-following sector rotation model retains a bullish bias and suggests holding Financial, Technology, and Industrial sectors. Also discussed are alternative ETFs and individual stock ideas.
  • Stocks Break Out Again But May Be Running On Fumes
    Tue, Mar. 3 AMG, BRCD, COMM 5 Comments

    Summary

    • Stocks continue to hit new highs despite low trading volume, a strong dollar, mixed economic reports, paralyzing weather conditions throughout the U.S., and ominous global news events.
    • Nevertheless, awash in investable cash, global investors see few choices better than U.S. equities.
    • The SPY chart looks somewhat overbought and overdue for a more significant pullback -- which would be healthy by testing support levels and recharging bullish conviction.
    • Overall, this week’s fundamentals-based Outlook rankings look a lot more bullish to me, with economically-sensitive sectors at the top, plus the emergence of Basic Materials.
    • Our trend-following sector rotation model retains a bullish bias and suggests holding Technology, Financial, and Industrial sectors. Also discussed are alternative ETFs and individual stock ideas.
  • Sector Rankings Stay Neutral With Few Bullish Catalysts On Horizon
    Wed, Feb. 18 ACHC, AMP, AVGO Comment!

    Summary

    • Stocks are hitting new highs, even though forward guidance that has been cautious and/or cloudy as sales into overseas markets are expected to suffer due to strength in the dollar.
    • Evidently, U.S. equities remain a relative safe haven for cautious but hungry global investors who have cheap money in their clutches, thanks to global liquidity and currency wars.
    • Although the SPY chart certainly looks bullish, I still think it is likely that we will get a longer period of consolidation, and perhaps some retesting of support levels.
    • Overall, this week’s fundamentals-based Outlook rankings look even more neutral in my view -- and perhaps even a bit defensive -- as market sentiment continues to grow more cautionary.
    • Still, our trend-following sector rotation model retains a bullish bias and suggests holding Technology, Financial, and Healthcare sectors. Also discussed are alternative ETFs and individual stock ideas.
  • Neutral Indicators And Mixed Reports, But Sector Rotation Model Is Bullish
    Tue, Feb. 10 ALL, AMP, FSLR 1 Comment

    Summary

    • Volatility continues as the parade of mixed earnings and economic reports marches along amidst a backdrop of global unrest and economic uncertainties.
    • Nevertheless, the trends appear to favor further flattening of the yield curve and continued strength in the dollar, gold, volatility, and equities.
    • Overall, this week’s fundamentals-based Outlook rankings have taken a neutral turn in my view, as market sentiment continues to grow more cautionary.
    • Nevertheless, our sector rotation model has a bullish bias and suggests holding Technology, Financial, and Energy. Also discussed are alternative ETFs and individual stock ideas.
  • Volatility Continues As Earnings Reports Create Excitement And Despair
    Mon, Feb. 2 BIIB, CAVM, IBB Comment!

    Summary

    • Volatility reigned in January on elevated volume as investors shifted their focus from global events to U.S. earnings reports, which have ranged from amazing (e.g., Apple) to crushing (e.g., Microsoft).
    • Although the road may be bumpier than the past couple of years, the path of least resistance appears to be up for U.S. equities, but will large caps continue to carry the load?
    • Overall, this week's fundamentals-based Outlook rankings still look generally bullish to me, although less so than last week, as market sentiment reflects cautious optimism.
    • Our sector rotation model suggests sticking with a neutral bias, and suggests holding Technology, Financial, and Healthcare. Also discussed are alternative ETFs and individual stock ideas.
  • With The Fed Fading Into The Shadows, Investors Look Overseas For New Catalysts
    Mon, Jan. 26 AMBA, IBB, IDU 1 Comment

    Summary

    • Stocks put an end to their streak of weekly losses, with Thursday providing the big catalyst, i.e., the ECB announcement of its new monetary stimulus plan. But will it work?
    • With Greece trying to turn back time, with volatility elevated (and likely to continue as such), and with the technical situation still dicey, the near term outlook is still worrisome.
    • For now, the asset classes of choice are distinctly 1990s-esque, i.e., long the U.S. dollar, long higher-quality U.S. equities, and long volatility.
    • Overall, this week’s fundamentals-based Outlook rankings look bullish to me, with the top five sectors all economically-sensitive and growth-oriented (or in the case of Healthcare, all-weather).
    • Our sector rotation model suggests sticking with a neutral bias and suggests holding Technology, Healthcare, and Financial. Also discussed are alternative ETFs and individual stock ideas.
  • New Year Kicks Off With New Fears To Keep Investors On Edge
    Tue, Jan. 20 ACT, IDU, IDXX 1 Comment

    Summary

    • As widely expected, the new year has begun with plenty of volatility on high trading volume, as investors fear more than just a mild correction to start out the year.
    • As global capital pours into the U.S., equities will likely benefit, and a continued flight to quality will favor companies with strong fundamentals and earnings quality.
    • The S&P 500 chart is desperately clinging to long-standing support lines, but there is a possible bearish head-and-shoulders pattern forming.
    • Overall, this week's fundamentals-based outlook rankings look bullish to me, with the top five sectors all economically sensitive and growth-oriented (or in the case of Healthcare, all-weather).
    • Our sector rotation model has moved to a neutral bias and suggests holding Technology, Healthcare, and Financial. Also discussed are alternative ETFs and individual stock ideas.
  • Bulls Close Out Another Solid Year With Expectation Of Further Gains But Higher Volatility In 2015
    Tue, Jan. 6 ACT, BERY, BRCD 3 Comments

    Summary

    • Another solid year for U.S. equities came to a close. But it’s not like everyone is jumping up and down with enthusiasm, which is a good thing.
    • Looking ahead, 2015 looks promising for further gains, but not without bouts of volatility. In fact, it might look a lot like 2014.
    • The S&P 500 chart seems to be finishing a minor pullback to test support and still shows solid bullish conviction.
    • Overall, this week’s fundamentals-based Outlook rankings look quite bullish to me. The top five sectors are all economically-sensitive (or in the case of Healthcare, all-weather).
    • Our sector rotation model continues to show a bullish bias and suggests holding Industrial, Technology, and Basic Materials. Also discussed are alternative ETFs and individual stock ideas.
  • Fed's Patience Puts Bulls In A Hurry
    Dec. 23, 2014 BCR, DEF, ED 1 Comment

    Summary

    • U.S. stocks found support once again last week and rallied on strong volume. The main catalyst was the FOMC policy statement with language expressing patience before raising rates.
    • The result was yet another classic V-bottom. With Santa lurking on the horizon, bears have run for cover from the charging bulls.
    • As I suggested it might, the SPY stabilized while working off its severely overbought technical condition and reconfirming bullish conviction.
    • Overall, this week’s fundamentals-based Outlook rankings still look bullish to me, particularly given the strength in Consumer Services/Discretionary.
    • Our sector rotation model continues to show a bullish bias and suggests holding Healthcare, Basic Materials, and (surprise!) Utilities. Also discussed are alternative ETFs and individual stock ideas.
  • Energy Sector Rains On Bulls' Parade, But Skies May Clear Soon
    Dec. 15, 2014 ALK, AMGN, CELG 2 Comments

    Summary

    • Stocks have needed a reason to take a breather and pull back in this long-standing ultra-bullish climate, and plummeting oil prices certainly have given it to them.
    • But this minor pullback was fully expected and desirable, and despite near-term risks, the future remains bright for the U.S. economy, GDP, job growth, and corporate profits.
    • The charts suggest that this is the minor (but still significant) pullback that I projected, and I am hopeful that it is sufficient to avoid a more dramatic event in.
    • This week’s fundamentals-based Outlook rankings still look bullish to me, as the top four sectors are all economically-sensitive and display strong Bull scores.
    • Our sector rotation model continues to show a bullish bias and suggests holding Healthcare, Industrial, and (surprise!) Basic Materials. Also discussed are alternative ETFs and individual stock ideas.
  • Bulls Revel In New Highs And Blue Skies, But Oil Introduces A Dark Cloud
    Dec. 8, 2014 CNC, FDX, HNT 5 Comments

    Summary

    • Although the future looks bright for U.S. equities as the major indexes hit or challenge new highs, the market has been gasping for a breather to gather bullish conviction.
    • Falling oil prices and a weak Energy sector seem to have introduced a reason to sell this week, and might prove to be a dreaded Black Swan, with far-reaching implications.
    • This week, we could see a more meaningful pullback or else we will likely have to wait until early January, which could be a more dramatic event.
    • This week’s fundamentals-based Outlook rankings still appear slightly bullish to me, despite the downward earnings revisions in most sectors.
    • Our sector rotation model continues to show a bullish bias and suggests holding Healthcare, Industrial, and Technology. Also discussed are alternative ETFs and individual stock ideas.
  • Holiday Fever Takes Hold Of Stock Investors, But A Pullback Is Needed
    Nov. 24, 2014 ACT, AGN, AMGN 5 Comments

    Summary

    • Investors seem to be catching a severe case of holiday fever and positioning themselves for the seasonally bullish time of the year.
    • Europe and Asia provided more fuel for the bull’s fire last week with stimulus announcements, particularly China’s interest rate cut.
    • Nothing goes up in a straight line, not even during the holidays, so a near-term pullback would be a healthy way to prevent a steeper correction in January.
    • This week’s fundamentals-based Outlook rankings still appear slightly bullish to me, despite the downward earnings revisions in most sectors.
    • Our sector rotation model continues to show a bullish bias and suggests holding Healthcare, Industrial, and Technology. Also discussed are alternative ETFs and individual stock ideas.
  • Stock Investors Make Up New Rules For Their New Market Paradigm
    Nov. 18, 2014 SPY, IXJ, PSI 11 Comments

    Summary

    • Investors in U.S. equities seem to have embraced a new market paradigm in which upside spikes come more swiftly than the downside selloffs.
    • Stocks have been consolidating gains off the October V-bottom reversal, and no one seems to be in any hurry to unload shares this time, with the holidays rapidly approaching.
    • The large cap charts have blue skies above, but small caps still have a lot of resistance overhead.
    • This week’s fundamentals-based Outlook rankings still look mostly bullish to me, despite the continued drumbeat of downward earnings revisions.
    • Our sector rotation model indicates a bullish bias and suggests holding Healthcare, Technology and Industrial. Also discussed are alternative ETFs and individual stock ideas.
  • Bulls Rule As Volatility Recedes And Investors Position For Holiday Cheer
    Nov. 10, 2014 ACT, ADM, ALXN 7 Comments

    Summary

    • Investors seem to have moved to full risk-on mode as volatility receded as quickly as it spiked, confounding many sophisticated traders.
    • But support levels likely will be tested during a technical consolidation phase before the market makes a concerted attempt to move higher, and a flight to quality should resume.
    • The charts are looking bullish but overbought, and this week’s fundamentals-based Outlook rankings continue to look bullish to me.
    • Our sector rotation model indicates a bullish bias and suggests holding Healthcare, Technology, and Industrial. Also discussed are alternative ETFs and individual stock ideas.
  • Bullish Conviction Returns, But Market Likely To Consolidate Its V-Bottom
    Oct. 27, 2014 FB, GILD, IDU Comment!

    Summary

    • Bulls showed renewed backbone last week and drew a line in the sand for bears, buying with gusto into weakness.
    • But there is little chance that the rally will go straight up. Volatility is back, and I expect prices to consolidate at this level before attempting to move higher.
    • The charts have recovered nicely, breaking through what could have been tough resistance, but now new resistance levels loom large and volume will be a challenge.
    • Overall, this week’s fundamentals-based Outlook rankings look even more bullish to me.
    • Nevertheless, our sector rotation model indicates a neutral bias and suggests holding Technology, Healthcare, and Financial. Also discussed are alternative ETFs and individual stock ideas.
  • Sharp Sell-Off In Stocks Sets Up Long Awaited Buying Opportunity
    Oct. 20, 2014 AAPL, AMZN, AWK 2 Comments

    Summary

    • Extreme volatility finally led bulls (and insiders) to buy into weakness, and the market finished the week on a high note, with continued momentum likely into this week.
    • This overdue correction ultimately will shape up as a buying opportunity -- i.e., there is no need to be afraid of the very thing investors have been hoping for.
    • The new market psychology should set the stage for lower equity correlations, selective stock picking, and capital flight to the highest quality companies.
    • The charts are looking exhausted to the downside, and our fundamentals-based rankings remain slightly bullish.
    • Nevertheless, our sector rotation model moved to a bearish bias and suggests holding Utilities, Healthcare, and Consumer Staples. Also discussed are alternative ETFs and individual stock ideas.
  • Semiconductors Get Slammed As Investors Scramble To Protect Profits
    Oct. 13, 2014 AGN, BRCM, C 1 Comment

    Summary

    • Volatility continues to increase in the stock market and many of the leaders are breaking down. In particular, semiconductors took a rather big hit.
    • Nevertheless, I do not think this spells the end of the bull market. But technical damage to the charts is severe, so large caps must show some leadership immediately.
    • It may be time to walk away from speculative bets as well as passive investing in broad indexes in favor of selective buying of high quality companies with market-dominant positions.
    • Overall, this week’s fundamentals-based Outlook rankings look slightly bullish to me.
    • Our sector rotation model continues with a neutral bias and suggests holding Technology, Healthcare, and Financial. Also discussed are alternative ETFs and individual stock ideas.
  • Overdue Market Weakness Finally Hits, But Sector Rankings Turn Bullish
    Oct. 6, 2014 AMGN, BBH, DFS 5 Comments

    Summary

    • Last week saw the type of market action that tests investors’ bullish conviction, and it was way overdue.
    • With volatility setting in, I don’t think we have seen the last of the scary market action. I expect further consolidation and testing of bullish conviction in the near term.
    • The charts appear to be in recovery mode, and our fundamentals-based sector rankings have turned bullish.
    • Our sector rotation model moved to a neutral bias and suggests holding Technology, Financials, and Healthcare. Also discussed are alternative ETFs and individual stock ideas.
  • Stocks Fight Off Predictable Weakness, But Expect More Downside
    Sep. 29, 2014 BBH, CELG, FITB Comment!

    Summary

    • Stocks showed significant weakness last week for the first time in a while, but it was all quite predictable and not overly concerning, although more downside is likely.
    • Market breadth is important for a sustained bull run, so the challenge for investors will be to put together broader bullish conviction, including the small caps.
    • Overall, this week’s fundamentals-based Outlook rankings look a bit biased to the bullish side of neutral.
    • Our sector rotation model still suggests a bullish stance, holding Healthcare, Technology, and Financial. Also discussed are alternative ETFs and individual stock ideas.
  • Bulls Go Down Swinging, Refusing To Give Up Much Ground
    Sep. 15, 2014 ACT, FDX, GILD 8 Comments

    Summary

    • Despite holding up admirably in the face of market weakness, I am still not convinced that we have seen the ultimate lows for this pullback. Danger looms.
    • All eyes will be on Wednesday afternoon's FOMC policy statement and their current sentiment regarding interest rates.
    • Overall, the SPY chart has weakened, and this week’s fundamentals-based Outlook rankings still look neutral to me.
    • Our sector rotation model still suggests a bullish stance, holding Healthcare, Technology, and Industrial. Also discussed are alternative ETFs and individual stock ideas.
  • Stock Market Breakout? Not So Fast
    Sep. 8, 2014 ACM, ACT, DEF 1 Comment

    Summary

    • Friday’s strong finish might seem like a breakout, but I’m not convinced. It seems more downside is in order, particularly entering the historically weak month of September.
    • The U.S. economy is strengthening while central banks flood world markets with liquidity, but that doesn’t mean that the stock market is destined to go straight up.
    • Overall, the SPY chart and this week’s fundamentals-based Outlook rankings look neutral to me.
    • Our sector rotation model suggests a bullish stance, holding Healthcare, Technology, and Industrial. Also discussed are alternative ETFs and individual stock ideas.
  • Up Next For Bulls, A Big Test Of Conviction
    Aug. 25, 2014 BBH, CNW, FB 2 Comments

    Summary

    • Bulls are having their way as summer draws to a close. But now the S&P 500 must deal with the ominous 2,000 level.
    • Investors continue to ride the way of improved hiring, rising corporate earnings, and a dovish Fed (along with other central banks around the world).
    • Overall, this week’s fundamentals-based Outlook rankings continue to look neutral despite the market strength.
    • Nevertheless, our sector rotation model suggests a bullish stance, holding Technology, Healthcare, and Industrial. Also discussed are alternative ETFs and individual stock ideas.
  • Bullish Investors Jockey For Position As If The Correction Is Over
    Aug. 19, 2014 SPY 4 Comments

    Summary

    • As many investors enjoy the final weeks of summer, some optimistic bulls seem to be positioning themselves well ahead of Labor Day in anticipation of a fall rally.
    • I doubt that was the entire pullback for the year. But I also believe that only a major Black Swan event can send this market into a deeper correction.
    • Overall, this week’s fundamentals-based Outlook rankings continue to look neutral to me, although there are some signs of bullishness.
    • Our sector rotation model suggests a neutral stance, holding Technology, Healthcare, and Energy. Also discussed are alternative ETFs and individual stock ideas.
  • August Consolidation Offers Opportunity To Buy Best Stocks From Top Sectors
    Aug. 11, 2014 BBH, BIIB, DEF 6 Comments

    Summary

    • Stocks saw elevated volume and volatility last week, and the 100-day simple moving average on the S&P 500 proved to be the proverbial line-in-the-sand for bullish investors.
    • The question remains as to whether that was the big new buying opportunity, or whether more backing-and-filling is needed.
    • Overall, this week’s fundamentals-based Outlook rankings look neutral to me. Technology remains top-ranked, and it is also the year-to-date performance leader.
    • Our sector rotation model suggests a neutral stance, holding Technology, Healthcare, and Utilities. Also discussed are alternative ETFs and individual stock ideas.
  • Patient Bulls Finally Get A New Entry Point, Thanks To Inflation Fears
    Aug. 4, 2014 ARRS, BBH, CVI 12 Comments

    Summary

    • The Fed hinted at some inflation and bulls got spooked, and of course a little fear at overbought levels can snowball in short order.
    • With a little more technical consolidation and successful testing of nearby support levels, the next move higher and a test of tough resistance could commence at any time.
    • Overall, this week’s fundamentals-based sector rankings again look slightly to the bullish side of neutral to me.
    • Nevertheless, our sector rotation model suggests a neutral stance, holding Technology, Healthcare, and Energy. Also discussed are alternative ETFs and individual stock ideas.
  • Bold Bulls Dare Meek Bears To Take Another Crack
    Jul. 28, 2014 ALGT, BBH, BIIB 4 Comments

    Summary

    • Once again, stocks have shown some inkling of weakness. But every other time for almost three years running, bears have failed to pile on and get a real correction going.
    • Despite weak or neutral charts and moderately bullish sector rankings, the trend is definitely on the side of the bulls, not to mention the bears’ neurotic skittishness.
    • Overall, although still not clear-cut, this week’s fundamentals-based Outlook rankings again look slightly bullish to me.
    • Our sector rotation model suggests a bullish stance holding Technology, Healthcare, and Industrial. Also discussed are alternative ETFs and individual stock ideas.
  • Bulls Remain Unfazed By Borderline Black Swans
    Jul. 21, 2014 BRCM, CIT, CPHD 1 Comment

    Summary

    • Despite an eventful news week, not much has changed for the stock market. Concern that the Malaysian airliner tragedy would be a dreaded Black Swan event passed quickly.
    • Strength in U.S. stocks is being driven by expectations of continued low interest rates, a big jump in GDP growth, and improving corporate earnings (which has looked promising).
    • Overall, although not clear-cut, this week’s fundamentals-based Outlook rankings look slightly more bullish to me.
    • Our sector rotation model suggests a bullish stance holding Technology, Healthcare, and Financial. Also discussed are alternative ETFs and individual stock ideas.
  • Will Earnings Season Provide The Next Catalyst For Stocks?
    Jul. 14, 2014 ACT, ARRS, BBH Comment!

    Summary

    • More unnerving conflicts around the globe have flared up, but U.S. equity investors seem to have become pretty much numb to the steady stream of unwelcome news.
    • Sell-side earnings expectations have been reduced from the previous lofty forecasts but are still high, so perhaps earnings season can catalyze a breakout from this consolidation zone.
    • Stocks lost their momentum in the post-holiday summer trading, as I predicted, and I still think there may be more downside in store before summer is over.
    • Still, our sector rotation model suggests a bullish stance holding Energy, Technology, and Healthcare. Also discussed are alternative ETFs and individual stock ideas.
  • Summer Slog Likely To Keep A Lid On Further Stock Gains
    Jul. 7, 2014 IDU, IYC, IYE Comment!

    Summary

    • With persistently overbought technical conditions and two months of summer doldrums ahead, stocks are unlikely to muster much in the way of further progress over the near term.
    • But sentiment indicators are cautious, buybacks continue, EPS is projected to set new records, and central banks continue to inject liquidity, so P/E multiples have room to rise further.
    • Utilities fell hard last week, allowing Energy to become the new leader year-to-date. Utilities is now in a virtual dead-heat with Healthcare and Technology.
    • Our sector rotation model suggests a bullish stance holding Technology, Energy, and Healthcare. Also discussed are alternative ETFs and individual stock ideas.
  • Mid-Year Mark Finds Eager Bulls Seeking Renewed Traction
    Jun. 30, 2014 ALK, FITB, FXR 1 Comment

    Summary

    • Stocks continue to hold up strong even though bulls have lost some traction, perhaps due to a combination of the summer doldrums and overbought technical conditions.
    • With little in the way of a catalyst in either direction at the moment, bulls remain in the driver seat.
    • Among the ten U.S. business sectors, income-oriented Utilities and REITs display the best performance year-to-date, while Energy and Technology have been coming on strong.
    • Our sector rotation model still suggests a bullish stance holding Technology, Industrial, and Financial. Also discussed are alternative ETFs and individual stock ideas.
  • Stocks Cruise Right Along, Whistling Past The Graveyard
    Jun. 23, 2014 FB, GD, IDU 2 Comments

    Summary

    • U.S. stocks continue to cruise along, although investors seem to be displaying a healthy level of caution and the technical condition remains overbought..
    • The adage “never short a dull market” has certainly rung true as there has not been a 10% pullback in nearly 3 years, while the VIX hit a 7-year low.
    • Overall, I would say that this week’s fundamentals-based Outlook rankings look neutral and non-committal..
    • Our sector rotation model still suggests a bullish stance holding Technology, Industrial, and Financial. Also discussed are alternative ETFs and individual stock ideas.