On balance, the first week of Earnings Season was favourable. See below for further details.
XJO Charts, Daily, Weekly, Monthly.
Charts for stocks reporting last week.
Summing Up Week One of Earnings Season.
XJO Charts, Daily, Weekly.
XJO Daily:
XJO is on a “do not buy” signal. Trend channels remain favourable but XJO has been in a sideways shuffle since 21 June. If we get a bullish break above resistance, XJO becomes a buy. Wait to see which way this breaks. Given overnight events in NY on Friday, it is highly unlikely that we will see an upside break in the next few days.
XJO Weekly:
XJO up this week +0.7%.
The chart is in a wave-like structure in a long-term up-sloping channel.
The weekly chart is close to the top of the Standard Error Channel. More upside could occur, but some sort of pull-back or consolidation in the near future is likely. Wait.
XJO Monthly:
Since late 2016, XJO has been in a narrow up-trend channel (within a broader Standard Error Channel). It is at the top of that narrow up-trend channel. It is constrained by an upscoping oblique resistance line and getting support from the 20-Month EMA. Expect a pull-back to horizontal support at 5976, or perhaps, a little further down to the 20-Month EMA.
A short-term pull-back seems likely.
In the long-term, the XJO looks likely to test the 2007 high by the end of the year. Buy dips.
Charts for Stocks Reporting Last Week.
Transurban:
Transurban was up 1.01% after it reported. That’s not a big movement.
On Friday, like a lot of other stocks, TCL fell heavily and was back to about where it was at COB on Monday.
That’s not a great result – but better than a plunge to the downside.
Transurban has pulled back above its 200-Day EMA, so is worth watching.
It seems that the good result for TCL was well-anticipated with solid rises on the two days prior to its report.
IOOF:
IFL fell -1.89% when it reported. It recover some of that on Wednesday and Thursday, but fell again on Friday.
Not a great response, but not terrible.
Note that IFL is sitting well below the 200-Day EMA, so it should be on the do-not-buy list.
Tabcorp:
The reaction to Tabcorp’s report was very strong. TAH up +7.56% and it saw follow-through on the following day. It only dropped a little on Friday.
This has put TAH in a bullish position and it might be worth buying dips – depending on broad market conditions.
TAH has now finished the week well above its 200-Day EMA.
The TAH result was apparently unexpected by those “in the know”, as TAH had fallen heavily on the previous day -3.02%.
CWN:
The gaming stocks did well with CROWN also up on its report, +6.68%.
The rise seems to have been well anticipated by those “in the know” with CWN up for two days in a row before the report.
Despite the good response, the big “shooting star” candle on Friday suggests caution. This looks like a pump-and-dump situation.
CBA:
CBA rose solidly on its reporting day, up +2.63%. It saw some follow-through on the next day. Although affected by intra-day selling on Friday, it still was up on Friday, just marginally, +0.03%.
The position of CBA remains precarious as it oscillates around its 200-Day EMA. Caution is required.
AMP:
AMP was up +3.88% on its report, but no follow-through buying occurred.
AMP remains in a sideways consolidation well below its 200-Day MA. Avoid.
SUN:
Suncorp was up +4.74% on its report. Friday saw it open on the downside by intra-day selling pulled it up to record a loss of -0.45%.
Suncorp is one of the few banking/insurance stocks which is doing well. Continue to buy-the-dip.
AGL Energy:
AGL fell -4.09% on its report and suffered further selling on Friday.
It is sitting well below its 200-Day EMA. Avoid.
Mirvac:
MGR opened well on the downside, but strong intra-day buying saw it bounce off its 50-Day EMA to finish down -0.42%. It lost ground again on Friday, when it was down -1.28%. I wouldn’t write off MGR on the basis of the current action, but a pull-back to test the 50-Day EMA again looks likely.
Magellan Financial Group:
Magellan had a great response to its report, +14.33%, and saw follow-through buying on Friday when many stocks lost ground.
MFG has run into major horizontal resistance. A successful test of major horizontal support would make this a “buy”.
Orora:
ORA fell heavily on Thursday, but bounced off support of the 200-Day EMA. Down on the day -3.62%. It was up a little on Friday, +0.29% but general market sentiment saw intra-day selling put a cap on advances.
The long-lower shadow on Thursday’s candle is a positive. If we see another successful test of the 200-Day EMA, this becomes a possible “buy”.
Summing up Week One of Earnings Season:
Eleven large cap stocks reported. Seven had positive responses.
The average movement for the eleven stocks was +7.38%. That occurred while the broad market index (XJO) was up +0.7%. That’s a good start to the Season – but anything can happen during this period.
The star of the show was Magellan (MFG) with the gaming stocks (CWN and TAH) also performing well. Be cautious with CWN.
(20min delay)