Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Yesterday’s break below 3425 short-term support in the S&amp;P 500 opens the door for potential visits to 3325 and 3200, two important support levels we are watching moving forward. With that said, as long as 3200 holds (the September lows) we are constructive and would be buyers on a pullback. At the same time, small-caps are providing a risk-on signal with the Russell 2000 (IWM) still holding above $159 short-term support. Leadership from small-caps is something we would expect to see in a broad-based bull market, and if IWM is above $159 it is hard to get too bearish overall.

Yesterday’s break below 3425 short-term support in the S&amp;P 500 opens the door for potential visits to 3325 and 3200, two important support levels we are watching moving forward. With that said, as long as 3200 holds (the September lows) we are constructive and would be buyers on a pullback. At the same time, small-caps are providing a risk-on signal with the Russell 2000 (IWM) still holding above $159 short-term support. Leadership from small-caps is something we would expect to see in a broad-based bull market, and if IWM is above $159 it is hard to get too bearish overall.

The S&amp;P 500, Nasdaq 100, and Russell 2000 are all holding above their respective short-term support levels and market dynamics remain positive. As a result, our outlook remains bullish and we continue to believe a “buy the dip” mentality is warranted. In today’s report we highlight attractive Groups and stocks within Services, Transportation, &amp; Utilities: Construction &amp; Engineering, Large-Cap, Auctions, Vehicle Rentals/Leasing, Electric, Southwest

The S&amp;P 500, Nasdaq 100, and Russell 2000 are all holding above their respective short-term support levels and market dynamics remain positive. As a result, our outlook remains bullish and we continue to believe a “buy the dip” mentality is warranted. In today’s report we highlight attractive Groups and stocks within Services, Transportation, &amp; Utilities: Construction &amp; Engineering, Large-Cap, Auctions, Vehicle Rentals/Leasing, Electric, Southwest

U. S. Equity Strategy: Upgrading Utilities; Downgrading Communications

The S&amp;P 500 made a new all-time closing high following the largely as-expected U.S.-China trade cease-fire agreement, but it did so unconvincingly. We would not call it a breakout as the market closed well off of the opening highs and not one cyclical Sector is decisively in new high territory. Overall, the market is sending mixed signals. Barring additional positive developments we believe upside is likely to be muted from here. In today’s report we highlight attractive Groups and stocks within Health Care, Services, and Technology: Diagnostic Imaging, Construction &amp; Engineering, Large-Cap, and Solar Energy.

The S&amp;P 500 made a new all-time closing high following the largely as-expected U.S.-China trade cease-fire agreement, but it did so unconvincingly. We would not call it a breakout as the market closed well off of the opening highs and not one cyclical Sector is decisively in new high territory. Overall, the market is sending mixed signals. Barring additional positive developments we believe upside is likely to be muted from here. In today’s report we highlight attractive Groups and stocks within Health Care, Services, and Technology: Diagnostic Imaging, Construction &amp; Engineering, Large-Cap, and Solar Energy.

Short-term rotation is underway. FANG stocks and parts of Tech, both long-term leaders, have become a short-term source of funds. Fortunately, this weakness is confined, resulting in sector and group rotation, not widespread selling. There is still plenty to like about this market, including areas we have shied away from for most of the year, such as energy and retailers.  This report highlights investment opportunities within the energy sector.

Short-term rotation is underway. FANG stocks and parts of Tech, both long-term leaders, have become a short-term source of funds. Fortunately, this weakness is confined, resulting in sector and group rotation, not widespread selling. There is still plenty to like about this market, including areas we have shied away from for most of the year, such as energy and retailers.  This report highlights investment opportunities within the energy sector.

U.S. Equity Strategy: Tactical Shift in Favoring Value over Growth; Buy Energy; Retailers Bottoming

United States

Comfort Systems USA, Inc. provides heating, ventilation, and air conditioning system installation, maintenance, repair, and replacement services. The Company's commercial and industrial markets include office buildings, retail centers, apartment complexes, hotels, manufacturing plants, and government facilities.

AECOM provides professional technical services to the United States government, state, local, and non-U.S. governments and agencies, and commercial customers.  The Company's services include consulting, planning, architecture, engineering, construction management, project management, asset management, environmental services, and design-build services.

EMCOR Group, Inc. provides mechanical and electrical construction and facilities services around the world.  The Company specializes in the design, installation, integration, and start-up of distribution systems for electrical power, lighting systems, low-voltage systems such as fire and security alarms, voice and data communication systems, ventilation systems, and plumbing and piping systems.

Fluor Corporation is a professional services company. The Company provides engineering, procurement, construction and maintenance as well as project management services on a global basis. Fluor also provides outsourcing of maintenance services and asset operations, equipment rental and sales, business support services, and other services.

KBR, Inc. is a global engineering, construction, and services company supporting the energy, petrochemicals, government services, and civil infrastructure sectors.  The Company offers a wide range of services through two business segments, Energy and Chemicals (E&C) and Government and Infrastructure (G&I).

MasTec, Inc. is a specialty contractor operating across a range of industries. The Company activities are the building, installation, maintenance, and upgrade of utility and communications infrastructure, including electrical utility transmission and distribution, wind farms, solar farms, renewable energy and natural gas infrastructure, wireless, and wireline.

Willscot Mobile Mini Holdings Corp. operates as a business services provider. The Company specializes in temporary space solutions such as modular office complexes, mobile offices, classrooms, restrooms, portable containers, and climate-controlled storage units. Willscot Mobile Mini Holdings serves customers in the United States, Canada, and Mexico.

Valmont Industries, Inc. designs and manufactures poles, towers, and structures for lighting, communication, and utility markets and provides protective coating services for infrastructure.  The Company also manufactures and distributes industrial and agricultural irrigation products in addition to a wide variety of fabricated products for commercial and industrial applications.

Dycom Industries, Inc. provides engineering, construction, and maintenance services to telecomm providers in the United States.  In addition to its primary services, the Company performs underground utility locating and electric utility contracting services.  Dycom also provides services related to the installation of integrated voice, data, and video networks in office buildings.

Sterling Construction Company, Inc. conducts operations in construction and distribution.  The Company specializes in municipal and state contracts for highway paving, bridge, water and sewer and light rail projects.  Sterling also distributes automotive accessories, non-food pet supplies, and lawn and garden products.

China Railway Group Ltd. offers transportation systems construction services. The Company builds railroads, roads, tunnels, and bridges.

Larsen & Toubro Ltd manufactures engineering equipment, undertakes large scale engineering projects, and acts as the Indian representative for a number of overseas manufacturers of heavy machinery. The Company's products include bulldozers, road rollers, dairy machinery, chemical and pharmaceutical plants, switchgears, food processing machinery and feed milling plants.

China State Construction Engineering Corporation Ltd. is a state-owned enterprise. The Company engages in housing construction, international building contracting, property development and investment, and infrastructure construction.

Ferrovial SA is an infrastructure operator and industrial company. The Company operates in multiple countries in a range of sectors including construction, airport, toll road, and municipal services.  Ferrovial SA also has a services division in which they provide facility management, infrastructure maintenance and upkeep, and energy and waste management services.

ACS, Actividades de Construccion y Servicios, S.A. is an engineering and contracting company that develops civil and industrial infrastructures. The Company provides Civil Works Construction, Greenfield Concession Development, Industrial Services (electricity, oil and gas) and Environmental Services (waste treatment and facility management).

ACS, Actividades de Construcción y Servicios (ACS SM)

ACS, Actividades de Construcción y Servicios

VINCI SA is a global player in concessions and construction with expertise in building, civil, hydraulic, and electrical engineering. The Company offers construction-related specialities and road materials production, as well as finance, management, operations and maintenance of public infrastructure such as motorways, airports, and road and rail infrastructures.

Bouygues SA offers construction services, develops real estate, offers cellular communications services, produces television programming and movies, and manages utilities.  The Company offers building, civil engineering, and oil and gas contracting services, develops residential, commercial, and office projects, produces and distributes water and electricity, and collects waste.

Power Construction Corporation of China, Ltd provides electric utility line construction services. The Company develops and constructs hydropower engineering, water works engineering, thermal power engineering, new energy engineering, and other projects. Power Construction China also operates property development.

China Railway Construction Corporation Limited provides transportation infrastructure construction services. The Company constructs railway, highway, urban track, and other infrastructure. China Railway Construction also provides real estate development and materials trading services.

China Railway Construction Cor (601186 CH)

WSP Global Inc. offers engineering services.  The Company offers professional services in the areas of construction, energy, the environment, mining, municipal infrastructure, project management, telecommunications, and transportation.

Quanta Services, Inc. provides specialized contracting services to electric utilities, telecommunication and cable television operators, and governmental entities.  The Company also installs transportation control and lighting systems and provides specialty electric power and communication services for industrial and commercial customers.  Quanta operates projects throughout North America.

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Quanta Services (PWR US)

U.S. Market Sending Mixed Signals

In today’s report we highlight attractive Groups and stocks within Consumer Discretionary, Materials, Health Care, & Services

Vermilion Research

U. S. Equity Strategy: Upgrading Utilities; Downgrading Communications

We are upgrading Utilities and downgrading Communications. We recap important technical levels across major indexes and share actionable ideas...

Vermilion Research

All-Time Closing Highs Fails To Impress

The S&P 500 made a new all-time closing high following the largely as-expected U.S.-China trade cease-fire agreement, but it did so...

Vermilion Research

U.S. Equity Strategy: Tactical Shift in Favoring Value over Growth; Buy Energy; Retailers Bottoming

Short-term rotation is underway. FANG stocks and parts of Tech, both long-term leaders, have become a short-term source of funds. Fortunately, this...

Vermilion Research

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