Stock Trends

Earnings season

Good morning,

We’re one week into earnings season and so far, Q3 reports haven’t been able to break stocks from their funk. The S&P 500 closed at fresh 3-month lows yesterday as companies that are missing earnings are being punished (average one-day move: -5.67%), while companies that beat are barely seeing a pop (+0.57% average one-day move, according to Bespoke).

The good news? So far, many of the key divergences we are watching are still in play. More on that Monday.

This week, we’ll look at some of those bellwether earnings reactions, as well as:

• Hot List stock setups going into earnings

• Telecom stocks trying to bottom

• Stocks to watch for a “tell” on the market

• and more!

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Bellwether earnings movers

Microsoft posts a one-month high following earnings

Blue Chip Hot List holding Microsoft powered 3% higher in yesterday’s tough tape following its earnings report. The stock hit a one-month high and a new all-time relative high, but will still need to break through the $350 level to reach escape velocity.

Alphabet drops to a 3-month low

GOOGL’s 9.51% loss yesterday was good for its worst day since March 2020 and pushed the stock to its lowest level since July. However, the stock did find support on the right side of the key $125 level.

META at risk of completing double-top

META has been as strong as any stock in the market during this correction, but the bears are starting to get to it. Last week’s failure at 52-week highs and bearish momentum divergence put a double-top into play and the stock’s initial 4% gain in the after-hours yesterday faded to a 3.3% loss by the conclusion of the earnings call. We’ll see where today takes us, but a close below $276 completes the double top and would target $222.