Copyright reminder: The following research note is intended solely for the use of subscribers. Redistribution in whole or in part is strictly prohibited.

Positive short-term sign to see continued strength in semiconductors ahead of Friday’s jobs report. When the semiconductor index closes at a 50-day high three days ahead of an employment report, stocks typically remain firm into the report day. Over the last 30 occurrences, the S&P500 was up 24 times (80%), down 6 times three days later, a decent edge over the 57% random odds. Average gain and loss were similar at 1.3% and 1.0% respectively.

SOX 50-day High Three Days Ahead of Jobs Report
08/03/21… SPX ??? three days later
06/29/21… SPX +1.4% three days later
01/05/21… SPX +2.6% three days later
12/01/20… SPX +1.0% three days later
09/01/20… SPX -2.8% three days later
08/04/20… SPX +1.4% three days later
06/02/20… SPX +3.7% three days later
09/04/18… SPX -0.9% three days later
03/06/18… SPX +2.1% three days later
10/31/17… SPX +0.5% three days later
10/03/17… SPX +0.6% three days later
05/30/17… SPX +1.1% three days later
05/31/16… SPX +0.1% three days later
12/01/15… SPX -0.5% three days later
06/30/14… SPX +1.3% three days later
06/03/14… SPX +1.3% three days later
04/01/14… SPX -1.1% three days later
03/04/14… SPX +0.2% three days later
12/03/13… SPX +0.6% three days later
10/17/13… SPX +1.2% three days later
04/30/13… SPX +1.1% three days later
02/01/11… SPX +0.3% three days later
11/02/10… SPX +2.7% three days later
01/05/10… SPX +0.7% three days later
08/04/09… SPX +0.5% three days later
08/02/05… SPX -1.4% three days later
03/01/05… SPX +1.0% three days later
11/02/04… SPX +3.2% three days later
09/02/03… SPX -0.1% three days later
03/05/02… SPX +1.6% three days later
12/04/01… SPX +1.2% three days later

The 7-day ADX for the S&P500 is hitting a one-year low Tuesday, reflecting a very trendless environment. When this occurs with the +DI component over the -DI (meaning trend more positive than negative), it has led to mixed market conditions with a downward bias in recent years (up 7 times, down 10 times). Nearly half of the moves were over 2%, suggesting the potential for a big move over the coming week…

SPX 7-day ADX One-Year Low, +DI>-DI
08/03/21… SPX ??? one week later
03/30/21… SPX +3.1% one week later
02/18/21… SPX -2.2% one week later
07/10/20… SPX +1.3% one week later
06/22/17… SPX -0.6% one week later
04/10/17… SPX -0.6% one week later
03/26/14… SPX +2.1% one week later
01/21/14… SPX -2.8% one week later
12/07/12… SPX -0.3% one week later
09/19/11… SPX -3.4% one week later
07/20/11… SPX -1.6% one week later
08/27/08… SPX -3.5% one week later
09/13/07… SPX +2.4% one week later
03/10/06… SPX +2.0% one week later
12/22/05… SPX -1.6% one week later
07/05/05… SPX +1.4% one week later
06/25/04… SPX -0.8% one week later
12/24/01… SPX +0.9% one week later

Earnings model will make the following adjustment at Tuesday’s close…

CVS Corp (CVS) will be sold and removed from the OEX portfolio

Copyright 2021 Yang Market Research - All Rights Reserved<