{"id":130158,"date":"2018-07-15T15:08:03","date_gmt":"2018-07-15T19:08:03","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=130158"},"modified":"2018-07-15T12:11:04","modified_gmt":"2018-07-15T16:11:04","slug":"us-equities-set-for-further-advances-as-q2-earnings-start","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2018\/07\/us-equities-set-for-further-advances-as-q2-earnings-start\/","title":{"rendered":"US equities set for further advances as Q2 earnings start"},"content":{"rendered":"
July 15, 2018<\/div>
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By TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n

The upside price moves recently in the US Equities markets have been dramatic.\u00a0 While many people believe the US Equity markets are overvalued and setting up for a top, we believe just the opposite \u2013 that the US Equity market and strong US Dollar are attracting capital and investment from numerous internal and external sources.\u00a0 We also believe the Q2 2018 earnings season, which is just about to begin, could be an additional driving force for further price advances \u2013 with big upside moves ahead.<\/p>\n

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There are really three things at work in the global markets right now:<\/strong><\/p>\n

Strong US Dollar and global trade\/policy issues<\/strong>: these are driving concerns and economic sustainability issues in many foreign nations and attracting investments as the US Dollar continues to strengthen against many foreign currencies.<\/p>\n

Foreign Debt\/Economic Sustainability issues:<\/strong>\u00a0the facts that economic cycles, as well as political and social concerns, have roiled many foreign markets, elections and policies in combination with somewhat out of control debt levels in some countries is starting to weigh on investors.\u00a0 Yes, strategic investors will still be looking for opportunities, but longer-term investors are seeking risks everywhere and are searching for protected investments \u2013 not risky deflationary investments.<\/p>\n

Leadership Changes\/Challenges:<\/strong>\u00a0as we have all recently seen, there are a number of political leadership and regional economic and policy challenges that are underway at the moment.\u00a0 Italy, Greece, Malaysia, Mexico, Denmark, Belgium and a host of others are all in the process of restructuring policies, objectives and SOP (standard operating procedures) to address new demands from their people and the world.\u00a0 What was acceptable, nearly 24+ months ago, is now just not the case any longer.\u00a0 The result is that leadership must adapt to the new demands of the people and economic environment.<\/p>

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Simply put, there is so much going on throughout the rest of the world in terms of currency valuations, global trade and policy issues, debt levels and economic sustainability concerns as well as leadership concerns and dramatically changing political and economic environments that investors are actively seeking some level of \u201cstandard of protection\u201d for their capital..\u00a0 And the only places on the planet, right now, that offer that standard are the US, Canada, and Great Britain. Our opinion is that, soon enough, the only economies on the planet that will be capable of handling the ROI and capital requirements of the world will be the most mature and dynamic economies on the planet.<\/p>\n

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Keeping this in mind, as we near the Q2 US earnings season, expect the following to play out:<\/strong><\/p>\n

\u2013 Technology will likely continue to shine with earnings growth and increased subscriber bases.\u00a0 Netflix, Hulu, Microsoft, Amazon and a host of other will likely surprise with earnings over the next few weeks.<\/p>\n

\u2013 Industrial standards like Disney, Comcast, Charter Communications, Sony, Marvel and many others will likely support strong earnings and forward guidance.<\/p>\n

\u2013 Manufacturing and Chemicals will likely be positive to mixed overall.\u00a0 Some companies will likely issue strong forward guidance while others may issue weaker guidance as a result of foreign market slowdowns.<\/p>\n

\u2013 Biotech and healthcare will likely produce strong results overall as the past quarter has likely been a \u201clean operational process\u201d for many not knowing what to expect throughout the next 12+ months.<\/p>\n

\u2013 Weakness may be seen in some isolated instances with companies that may be more exposed to global demand and raw material costs (oil, copper, hard materials).\u00a0 Yet we believe the outcome of this Q2 earnings season will be moderately strong overall.<\/p>\n

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What does this mean for the markets?<\/strong><\/p>\n

This 240 Minute ES chart shows the recent upside price action as well as the recent breakout to new highs (above 2800 for the first time since March 2018).\u00a0 These upside price channels are likely to hold going forward and we expect earnings to drive prices to near or above 2900 (new all-timehighs) relatively quickly in the ES.\u00a0 As we have been highlighting, we believe the ES and YM have the strongest potential for upside price moves compared to the NQ.<\/p>\n

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This Daily SPY chart clearly shows the rotational lows followed by upside price advances that are indicative of the recent price swings.\u00a0 These deep rotational lows continue to setup \u201chigher low\u201d price levels that allow technicians to understand price pivot formations.\u00a0 Each of these rotations sets up an opportunity for skilled traders to jump into the next upside move for profits.\u00a0 The recent breakout of new highs indicates we could be in for a dramatic move to well above $290 throughout the earnings season.<\/p>\n

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Lastly, this 240 Minute YM chart helps to illustrate the upside potential of the DOW & Transports Index.\u00a0 The last upside swing in price from July 7th<\/sup>\u00a0till July 11th<\/sup>\u00a0totaled about 800 points.\u00a0 If that move replicates with this new upside swing, we could see another +800 point move higher from recent lows near 24,500.\u00a0 This would indicate an upside potential to near 25,300 or higher.<\/p>\n

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Make sure you are positioned for these moves through this next earnings season.\u00a0 If our estimates are correct, we should see some fantastic trading opportunities over the next 30+ days.\u00a0 Visit\u00a0www.TheTechnicalTraders.com<\/u><\/strong><\/a>\u00a0to learn how we can assist you in capturing greater profits and greater success with our advanced research and market reporting, Daily market videos, detailed trading signals and more.\u00a0 Join the hundreds of other traders that follow our research every day to create greater successes.<\/p>\n

Also, visit\u00a0www.TheTechnicalTraders.com\/FreeMarketResearch<\/u><\/strong>\u00a0to read all of our most recent free research posts.\u00a0 We believe you\u2019ll quickly see the value in what we provide our members and our visitors by reading and understanding how we have continued to stay ahead of these market moves for months.<\/p>\n

Chris Vermeulen<\/p>\n

By TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

By TheTechnicalTraders.com The upside price moves recently in the US Equities markets have been dramatic.\u00a0 While many people believe the US Equity markets are overvalued and setting up for a top, we believe just the opposite \u2013 that the US Equity market and strong US Dollar are attracting capital and investment from numerous internal and […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-130158","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/130158","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=130158"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/130158\/revisions"}],"predecessor-version":[{"id":130159,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/130158\/revisions\/130159"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=130158"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=130158"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=130158"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}