The U.S. market is in a Rally Attempt. The S&P 500 and Nasdaq have now held above the October 11 intraday
low ( S&P 500: 2,710; Nasdaq: 7,274 ) for six sessions, but have yet to stage a follow-through day. Ideas, like the
major averages, continue to whipsaw around within their respective bases and few are even trading above their
respective 50-DMA. We removed 14 U.S. Focus List ideas over the last two weeks due to technical deterioration
and eight of the current 58 (~14%) are still trading below their respective 200-DMA and at risk of removal. We
are concerned with the lack of leadership in the market as well as the negative reactions to positive earnings re-
sults over the past week. We, therefore, continue to recommend a defensive posture, avoiding new buys and
selling ideas that have broken long-term support. If we get a follow-through day next week, we will upgrade the
market, however, our recommendation will be to gradually increase risk should that occur, with a focus on high
relative strength quality ideas with improving A/D Ratings that have either held or regained their respective 50-
DMA.
Stocks on our U.S. Focus List: Current Sentiment
Our USFL of 58 ideas lost 1.4% on average this week, underperforming the S&P 500 (flat) and the Nasdaq (-
0.6%).
Actionable Focus List Ideas: Centennial Resource Dvlp ( CDEV ), Lamb Weston ( LW ), Nomad Foods ( NOMD ),
Unitedhealth ( UNH ), Zoetis ( ZTS )
USFL ideas weekly earnings line-up:
Tuesday: Open: NEP; Close: EW, ILMN
Wednesday: Close: ALGN, AMD, NOW, V, VRTX, XNLX
Thursday: Open: GRUB, UNP; Close: AMZN, GOOGL, SIVB
By Sector
Outside of Consumer Staple, all sectors remain weak. Technology ideas within the U.S. Focus List continue to
trade lower. Multiple ideas have been removed from the USFL, with others including ATVI, AMD, MTCH, PSTG,
GOOGL, and SSNC breaking back under individual support levels. Health Care ideas on the USFL remain weak
as well. ABMD, PRAH, and ILMN are living below their respective 50-DMA, while ALGN and IDXX are testing
support along their 200-DMA. ZTS and UNH continue to hold up well on a relative basis. Consumer Staple ide-
as are also acting well on a relative basis; NOMD, LW, and MKC are all trading at or near new highs.
