More boxes filled in stock market bottom checklist

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A stock market bottom is closer but more than half of the needed conditions have yet to be met, according to Oppenheimer.

Now three out of 10 boxes in its Stock Market Bottom checklist are checked, up from just one last week, technical analyst Ari Wald wrote in a note.

“While the checklist doesn’t show many indicators at a deep extreme, the checklist reflects market conditions closer to a bottom than a top, by our analysis,” Wald said. “We believe such signals offer an opportunity for investors with a 12+ month time horizon, specifically those who are able to see through what are likely to be ongoing bouts of market volatility through the summer months.”

“Still, more is needed, including a test of (last) Thursday’s low. We assume ‘W’ reversals occur more often than ‘V’ reversals, especially without accommodative Fed intervention.”

Along with the VIX (VIX) above 35, the Investors Intelligence bull/bear gauge has fallen below 1 and the Small-Cap 200-day Deviation just moved past its target to -21%.

Other conditions are very close, including the S&P 500 (SP500) (NYSEARCA:SPY) peak-to-trough decline of 21%.

50/50 changes: Oppenheimer also released the entrants and departures on its 50/50 List, which names 50 Buys and 50 Buys in the large-cap universe of the S&P 500, Russell 1000 (NYSEARCA:IWB) and large-cap ADRs.

“This list adopts a market-neutral and sector-neutral stance by providing the same number of buy and sell ideas. The changes listed below are sorted by sector, then by market cap.”

Added buys:

  1. Corteva (CTVA)
  2. Packaging Corp (PKG)
  3. Raytheon (RTX)
  4. L3Harris (LHX)
  5. C.H. Robinson (CHRW)
  6. Dollar General (DG)
  7. Henry Schein (HSIC)
  8. Travelers (TRV)
  9. Iron Mountain (IRM)
  10. Hewlett Packard Enterprise (HPE)
  11. DTE Energy (DTE)
  12. Ameren (AEE)

Removed Buys:

  1. Freeport-McMoRan (FCX)
  2. Union Pacific (UNP)
  3. Waste Connections (WCN)
  4. Tractor Supply (TSCO)
  5. Thermo Fisher (TMO)
  6. Schwab (SCHW)
  7. Duke Realty (DRE)
  8. Aristan Networks (ANET)
  9. Teledyne (TDY)
  10. Live Nation (LYV)
  11. Nextera Energy (NEE)
  12. Brookfield Infrastructure (BIP)

Added Sells:

  1. Schlumberger (SLB)
  2. Vulcan Materials (VMC)
  3. Celanese (CE)
  4. Textron (TXT)
  5. Colgate-Palmolive (CL)
  6. PPL (PPL)

Removed Sells:

  1. Phllips 66 (PSX)
  2. Amcor (AMCR)
  3. Conagra (CAG)
  4. IPG Photonics (IPGP)
  5. Electronic Arts (EA)
  6. NRG Eenergy (NRG)

The bull market is in its tenth year. What now?

More boxes filled in stock market bottom checklist

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