This Will Set the Tone for Earnings Season

My contrarian nature has me wondering if we’re due for a surprise. [Jeff Clark's Market Minute]( This Will Set the Tone for Earnings Season By Jeff Clark, editor, Market Minute Once again, it’s all up to the banks. The action in bank stocks tends to lead the action in the broad stock market. When banks are strong, the market rallies. When banks are weak, so is the stock market. Over the next two weeks, most of the major money center banks are scheduled to report earnings. And however the market reacts to those reports will set the tone for this earnings season… Recommended Link [How to make money in a bearish market]( [image]( What if you could ignore 99% of the entire stock market…and still have the chance to make money in bullish AND bearish conditions? Sadly, most folks don’t even see triple-digit returns in a single year – or even in 10-years… But today, millionaire trader and former professional money manager Jeff Clark, is revealing his newest trading breakthrough… He’s used this secret to help 170,000 regular folks have the chance to see triple-digit gains over 48 times and double-digit gains over 81 different times. The key: Don’t over-complicate things. [Watch Jeff Demonstrate His ONE Stock Trade Now.]( -- That’s not a new concept, by the way. We watched the bank stocks [three months ago]( as they were all lined up to report earnings. Back then, expectations were poor. The bank stocks and the stock market had been declining. And, my contrarian nature had me leaning optimistic for a surprise upside move. But it didn’t happen. For the most part, the bank stocks sold off following their earnings reports. And the broad stock market sold off along with them. From mid-April until mid-May (the heart of last quarter’s earnings season) the KBW Bank Index (BKX) lost about 15%. The S&P 500 lost 11%. Fast forward to today… Bank stocks have been weak heading into this reporting season. The KBW Bank Index (BKX) is down 13% over the past month, and trading near its low for the year. Expectations are low. Just about all the financial television talking heads are leaning bearish for the sector. And my contrarian nature has me wondering if we’re due for an upside surprise. Take a look at this chart of BKX… [(Click here to expand image)]( The banking sector has been in a strong, steady downtrend since it peaked in early January. BKX is down about 30% since early January. And, so far, there isn’t any evidence that trend is ready to change. But there are some positive signs in the short term. While BKX has recently dropped to a lower low for the year, the technical indicators at the bottom of the chart (MACD, RSI, and CCI) are making higher lows. Free Trading Resources Have you checked out Jeff's free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career – at zero cost to you. Just [click here]( to check it out. This is the sort of “positive divergence” that often signals an impending change in trend – from bearish to bullish. The upcoming earnings reports could be a catalyst for that shift. Let’s face it, most investors aren’t looking for positive announcements from the banks. The yield curve has flattened… loan demand is down… and with the poor stock market action this year, trading revenues are likely to be lower as well. The weakness in the bank stocks is already discounting all that bad news. So, any hint of good news could inspire an oversold rally in the banking sector. [Florida man leaves crypto crowd speechless…]( And if the banks start to rally, then the rest of the stock market should follow along. On the other hand, if the banks fail to rally in reaction to their earnings reports, then this is going to be a tough earnings season for the rest of the market as well. Best regards and good trading, [signature] Jeff Clark Reader Mailbag In today’s mailbag, Market Minute subscriber Martin shares his thoughts on [Eric’s essay from last week]( My limited view on this Eric is that six months ago we had a major risk coming from Evergrande. Like the “Lehman Moment,” the problem didn’t happen when the system crashed, it happened 9-12 months before that. And we are close to that impact. Evergrande has spread, and in a lot of Chinese cities, companies are in trouble. It could now implode… look at the Chinese government pilling up the saving lines to everybody. It’s not a good sign, and when it implodes it’ll be much larger than China. Could we avoid that iceberg with all its collaterals? We will know by Christmas. – Martin M. Thank you, as always, for your thoughtful comments. We look forward to reading them every day. Keep them coming at feedback@jeffclarktrader.com. In Case You Missed It… [Take the necessary steps now…]( In 2018, former Goldman Sachs Managing Director Dr. Nomi Prins called for a crash that would wipe out investors. Today, that’s the last thing on her mind. In fact, she has stated the next crisis won’t be a crash at all. It has nothing to do with a pandemic, or inflation, either… [Click here to find out what she sees coming instead]( – and why investors could be left behind if they don’t act now. If you have more than $1,000 in the bank, this could be the most important interview you see in the next 60 days. Don’t get caught off guard by what will happen next. [Watch her bombshell prediction for America’s economy now.]( [image]( Get Instant Access Click to read these free reports and automatically sign up for daily research. 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