“While the SPX dipped into the red for 2021, it was a short-lived trip. Therefore, with the 50-day moving average sitting at 3,741, and the 2020 close at 3,756, this remains a first area of potential support if the market retreats... if you draw a trendline connecting higher highs since mid-November, the 3,920 level marks potential resistance into this Friday’s close, with last week’s high coming just shy of the 3,900-century mark.”

          - Monday Morning Outlook, Feb. 8, 2021

Last week was a familiar story, with the S&P 500 Index (SPX - 3,934.83) carving out yet another high thanks to a strong Monday session, in which the index charged above the 3,900-century mark. After that, it was pretty much sideways movement, with resistance coming into play at the 3,920 area, which I highlighted as the top of a channel dating back to mid-November. That was also when a positive vaccine update made headlines.

If you use the SPX’s channel to chart its course over the next week, resistance comes into play at 3,940 at the beginning, and 3,955 at the end. If the market retreats, the 3,810 level is a site of potential channel support at Tuesday’s close, while 3,825 is the site at Friday’s close.

If there is a move below channel support, the 3,750 level once again becomes a potential floor. This is also the 50-day moving average’s location, which contained the benchmark’s most recent pullback, when forced selling emerged amid a notable short-covering rally. The 2020 close is in the vicinity of this moving average, too. What’s more, the previous year’s close is at a level that has been important over the past few years. For instance, the 2019 close acted as support in late January of 2020, as well as multiple times over the second half of the year. Then, across the year-to-date breakeven point in February of 2020 began a period of vicious selling.

It is expiration week, so I looked at the open interest configuration on the SPDR S&P 500 ETF Trust (SPY -  392.64) to see what levels would be important for both the SPY and the SPX. The SPY 395 strike, equivalent to the SPX 3,950, is home to almost 100,000 calls, most of which were bought-to-open. On one hand, a rally near this strike could spark delta-hedge buying that ends after the SPY gets through the strike. In fact, delta-hedge buying may have occurred in the last half-hour of trading on Friday.

But if the SPY remains below $395, a headwind could creep into play, as long futures positions related to the call open interest at that strike are liquidated as expiration nears. This scenario would be consistent with the SPX remaining in the channel discussed above. If stocks sell off, the 380 and 385 strikes -- which are equivalent to the SPX 3,800 and 3,850 -- would be potential options-related equilibrium points, given the hefty put and call open interest located at these strike prices. The SPX 3,850, for what it is worth, was around a closing high ahead of its late-January hiccup.

“I still prefer the small-cap space. Not only is there more short-covering potential in this space -- as I have been highlighting since mid-December -- but the technical backdrop looks firmer. For example, the Russell 2000 Index (RUT - 2,233.33) never dipped below its 30-day moving average, nor did it come remotely close to moving below its 2020 close of 1,975.”

          - Monday Morning Outlook, Feb. 8, 2021

Turning to the sentiment front, I have a few worthwhile observations. First, even though I have said I prefer small caps due to their short-covering potential relative to large cap stocks, I found the huge short covering in the second half of January on SPX components interesting (see the first graph below). Short interest on SPX components remains a little bit above the 10-year and 15-year lows that preceded market weakness. 

I have heard multiple guests and hosts on CNBC say that this is not a heavily shorted market, and I agree with those statements when considering only SPX components. However, despite short covering in the Russell 2000 Index (RUT - 2,289.36) over the past few reporting periods, I continue to see the small caps as heavily shorted, and thus the biggest area of opportunity if equities continue to advance.

Continuing with the small cap versus large cap theme, I was amazed when our own Quantitative Senior Analyst Chris Prybal put the chart below, together last week. It is the 10-day, equity-only put/call volume ratio on only components of the iShares Russell 2000 ETF (IWM - 227.26). 

This IWM component-only put/call volume ratio is relatively high, in huge contrast to the all-equity, 10-day buy-to-open put/call volume ratio that I have discussed multiple times since early December. In fact, the IWM component ratio is at levels that have typically preceded market bottoms. Amid the concerns I have voiced and have heard others express about unusually heavy call buying relative to put buying in equities, small-cap stocks should not be included in this conversation. In conclusion, this graph further solidifies my view that if you are taking on equity risk, ensure you emphasize small-cap stocks.

Todd Salamone is Schaeffer's Senior V.P. of Research

Continue reading:

• The Week Ahead: Shortened Holiday Week to Remain Full With Economic Data
• Indicator of the Week: 2 Technical Indicators for Bulls to Keep in Their Trading Toolkit

The four-day week this week will still bring a fair amount of economic data. Housing and consumer data will highlight the week, as will the usual initial and continuous jobless claims. Earnings season will continue as well. The list of upcoming reports includes Applied Materials (AMAT), CVS Health (CVS), Shopify (SHOP), Sunpower (SPWR), and Walmart (WMT). 

Today will bring the Empire State Manufacturing Index.

The following companies are slated to release quarterly earnings reports today, February 16:

Advance Auto Parts Inc. (NYSE:AAP -- $152.81) provides automotive replacement parts, accessories, batteries, and maintenance items for domestic and imported cars, vans, sport utility vehicles, and light and heavy duty trucks. Advance Auto Parts will report its fourth-quarter earnings of 2020 before the bell today.

Allegion plc. (NYSE:ALLE -- $118.26) manufactures and sells mechanical and electronic security products and solutions. Advance Auto Parts will report its fourth-quarter earnings of 2020 before the bell today.

AutoNation Inc. (NYSE:AN -- $118.26) operates as an automotive retailer. AutoNation will report its fourth-quarter earnings of 2020 before the bell today.

Black Knight Inc. (NYSE:BKI -- $87.40) provides integrated software, data, and analytics solutions. Black Knight will report its fourth-quarter earnings of 2020 before the bell today.

Bruker Corp. (NASDAQ:BRKR -- $60.75) manufactures and distributes scientific instruments, and analytical and diagnostic solutions. Bruker will report its fourth-quarter earnings of 2020 before the bell today.

Ceva Inc. (NASDAQ:CEVA -- $69.87) operates as a licensor of wireless connectivity and smart sensing platforms to semiconductor and original equipment manufacturer (OEM) companies. Ceva will report its fourth-quarter earnings of 2020 before the bell today.

CVS Health Corp. (NYSE:CVS -- $74.21) provides health services and plans. CVS Health will report its fourth-quarter earnings of 2020 before the bell today.

Ecolab Inc. (NYSE:CVS -- $219.88) provides water, hygiene, and energy technologies and services. Ecolab will report its fourth-quarter earnings of 2020 before the bell today.

Expeditors International of Washington Inc. (NASDAQ:EXPD -- $96.58) provides logistics services. Expeditors International will report its fourth-quarter earnings of 2020 before the bell today.

Franklin Electric Co. Inc. (NASDAQ:FELE -- $74.81) designs, manufactures, and distributes water and fuel pumping systems. Franklin Electric will report its fourth-quarter earnings of 2020 before the bell today.

IAA Inc. (NYSE:IAA -- $62.36) provides auction solutions for total loss, damaged, and low-value vehicles. IAA will report its fourth-quarter earnings of 2020 before the bell today.

IPG Photonics Corp. (NASDAQ:IPGP -- $252.89) develops and manufactures a range of high-performance fiber lasers, fiber amplifiers, and diode lasers used in various applications. IPG Photonics will report its fourth-quarter earnings of 2020 before the bell today.

JELD-WEN Holding Inc. (NYSE:JELD -- $28.55) designs, manufactures, and sells doors and windows. JELD-WEN will report its fourth-quarter earnings of 2020 before the bell today.

Louisiana-Pacific Corp. (NYSE:LPX -- $43.52) manufactures building products primarily for use in new home construction, repair and remodeling, and outdoor structure markets. Louisiana-Pacific will report its fourth-quarter earnings of 2020 before the bell today.

MGM Growth Properties LLC (NYSE:MGP -- $33.23) is a publicly traded real estate investment trusts. MGM Growth Properties will report its fourth-quarter earnings of 2020 before the bell today.

Palantir Technologies Inc. (NYSE:PLTR -- $33.23) is power transmission motion control products. Palantir Technologies will report its fourth-quarter earnings of 2020 before the bell today.

Palantir Technologies Inc. (NYSE:PLTR -- $31.91) is power transmission motion control products. Palantir Technologies will report its fourth-quarter earnings of 2020 before the bell today.

Sabre Corp. (NASDAQ:SABR -- $11.81) provides technology solutions to the travel and tourism industry. Sabre will report its fourth-quarter earnings of 2020 before the bell today.

TransUnion (NYSE:TRU -- $95.06) provides risk and information solutions. TransUnion will report its fourth-quarter earnings of 2020 before the bell today.

Triton International Ltd. (NYSE:TRTN -- $56.36) engages in the acquisition, leasing, re-leasing, and sale of various types of intermodal containers and chassis to shipping lines, and freight forwarding companies and manufacturers. Triton International will report its fourth-quarter earnings of 2020 before the bell today.

US Foods Holding Corp. (NYSE:USFD -- $36.89) markets and distributes fresh, frozen, and dry food and non-food products to foodservice customers. US Foods will report its fourth-quarter earnings of 2020 before the bell today.

Vulcan Materials Co. (NYSE:VMC -- $164.50) produces and supplies construction materials. Vulcan Materials will report its fourth-quarter earnings of 2020 before the bell today.

Yandex N.V. (NASDAQ:YNDX -- $73.83) is an Internet and technology company. Yandex N.V. will report its fourth-quarter earnings of 2020 before the bell today.

Zoetis Inc. (NYSE:ZTS -- $166.71) discovers, develops, manufactures, and commercializes animal health medicines, vaccines, and diagnostic products. Zoetis will report its fourth-quarter earnings of 2020 before the bell today.

ACCO Brands Corp. (NYSE:ZTS -- $9.00) designs, manufactures, and markets consumer and business products. ACCO Brands will report its fourth-quarter earnings of 2020 before the bell today.

Agilent Technologies Inc. (NYSE:A -- $127.98) provides application focused solutions to the life sciences, diagnostics, and applied chemical markets. Agilent will report its fourth-quarter earnings of 2020 before the bell today.

American International Group Inc. (NYSE:AIG -- $41.40) provides insurance products for commercial, institutional, and individual customers. American International will report its fourth-quarter earnings of 2020 before the bell today.

Avis Budget Group Inc. (NASDAQ:CAR -- $44.71) provides car and truck rentals, car sharing, and ancillary services to businesses and consumers. Avis Budget will report its fourth-quarter earnings of 2020 before the bell today.

Boyd Gaming Corp. (NYSE:BYD -- $54.09) operates as a multi-jurisdictional gaming company. Boyd Gaming will report its fourth-quarter earnings of 2020 before the bell today.

Compass Minerals International Inc. (NYSE:CMP -- $64.18) produces and sells salt, and specialty plant nutrition and chemical products. Compass Minerals will report its fourth-quarter earnings of 2020 before the bell today.

Continental Resources Inc. (NYSE:CLR -- $23.02) explores for, develops, and produces crude oil and natural gas properties. Continental Resources will report its fourth-quarter earnings of 2020 before the bell today.

Cornerstone OnDemand Inc. (NASDAQ:CSOD -- $47.41) provides learning and people development solutions through software-as-a-service model. Cornerstone OnDemand will report its fourth-quarter earnings of 2020 before the bell today.

Denny's Corp. (NASDAQ:DENN -- $16.43) owns and operates full-service restaurant chains under the Denny's brand. Denny's will report its fourth-quarter earnings of 2020 before the bell today.

Devon Energy Corp. (NYSE:DVN -- $19.98) is produces and supplies construction materials. Devon Energy will report its fourth-quarter earnings of 2020 before the bell today.

Diodes Inc. (NASDAQ:DIOD -- $82.14) designs, manufactures, and supplies application-specific standard products in the discrete, logic, and analog and mixed-signal semiconductor markets. Diodes will report its fourth-quarter earnings of 2020 before the bell today.

Encore Wire Corp. (NASDAQ:WIRE -- $64.69) manufactures and sells electrical building wires and cables for interior electrical wiring. Encore Wire will report its fourth-quarter earnings of 2020 before the bell today.

Eversource Energy (NYSE:ES -- $85.17) is a public utility holding company. Eversource Energy will report its fourth-quarter earnings of 2020 before the bell today.

Exact Sciences Corp. (NASDAQ:EXAS -- $155.01) provides cancer screening and diagnostic test products. Exact Sciences will report its fourth-quarter earnings of 2020 before the bell today.

Genworth Financial Inc. (NYSE:GNW -- $4.11) provides insurance products. Genworth Financial will report its fourth-quarter earnings of 2020 before the bell today.

Innospec Inc. (NASDAQ:IOSP -- $100.08) develops, manufactures, blends, markets, and supplies specialty chemicals. Innospec will report its fourth-quarter earnings of 2020 before the bell today.

Invitation Homes Inc. (NYSE:INVH -- $31.00) is a single-family home leasing company. Invitation Homes will report its fourth-quarter earnings of 2020 before the bell today.

KAR Auction Services Inc. (NYSE:KAR -- $19.19) engages in the provision of used car auction services and salvage auction services. KAR Auction Services will report its fourth-quarter earnings of 2020 before the bell today.

Kornit Digital Ltd. (NASDAQ:KRNT -- $98.10) develops, designs, and markets digital printing solutions for the fashion, apparel, and home decor segments of printed textile industry. Kornit Digital will report its fourth-quarter earnings of 2020 before the bell today.

Lattice Semiconductor Corp. (NASDAQ:LSCC -- $48.44) is produces and supplies construction materials. Lattice Semiconductor will report its fourth-quarter earnings of 2020 before the bell today.

La-Z-Boy Inc. (NYSE:LZB -- $40.80) manufactures, markets, imports, exports, distributes, and retails upholstery furniture products, accessories, and casegoods furniture products. La-Z-Boy will report its third-quarter earnings of 2021 before the bell today.

Mercer International Inc. (NASDAQ:MERC -- $13.72) manufactures and sells northern bleached softwood kraft (NBSK) pulp. Mercer International will report its fourth-quarter earnings of 2020 before the bell today.

Mercury General Corp. (NYSE:MCY -- $55.97) is produces and supplies construction materials. Mercury General will report its fourth-quarter earnings of 2020 before the bell today.

NMI Holdings Inc. (NASDAQ:NMIH -- $22.38) provides private mortgage guaranty insurance services. NMI Holdings will report its fourth-quarter earnings of 2020 before the bell today.

QTS Realty Trust Inc. (NYSE:QTS -- $63.69) is a provider of data center solutions across a diverse footprint. QTS Realty Trust will report its fourth-quarter earnings of 2020 before the bell today.

QuantumScape Corp. (NYSE:QS -- $54.64) develops and commercializes solid-state lithium-metal batteries for electric vehicles. QuantumScape will report its fourth-quarter earnings of 2020 before the bell today.

RingCentral Inc. (NYSE:RNG -- $443.29) provides software-as-a-service solutions that enable businesses to communicate, collaborate, and connect. RingCentral will report its fourth-quarter earnings of 2020 before the bell today.

TriNet Group Inc. (NYSE:TNET -- $84.45) provides human resources (HR) solutions for small and midsize businesses. TriNet Group will report its fourth-quarter earnings of 2020 before the bell today.

Vornado Realty Trust (NYSE:VNO -- $38.39) is a real-estate investment trust. Vornado will report its fourth-quarter earnings of 2020 before the bell today.

Looking ahead to tomorrow, things speed up a bit with retail sales data, Producer Price Index (PPI), Core PPI, Industrial Production for January, and the Federal Open Market Committee (FOMC) minutes. All economic dates listed here are tentative and subject to change.

A few weeks ago, we checked in on how investor sentiment was looking for the New Year through a handful of useful indicators. Since we have now entered the second month of 2021, it seemed appropriate to revisit any changes that may have taken place since the start of the year. While a few weeks may not seem like ample time for a significant change to happen, we know from our experience with last March’s Covid-19 market crash that anything is possible on Wall Street. A more recent -- and pertinent -- example is the extreme volatility and broader-market selloff stocks experienced at the end of January, following the GameStop (GME) Reddit mania.

As stated in the first check-in, "There's still a ‘buzz’ to 2021, thanks to President-elect Joe Biden's thankfully seamless inauguration and the ramped-up vaccine efforts many are hoping will come along with the new administration. The Dow, S&P 500, and Nasdaq all boast very muted gains to start 2021, yet, as we're about to see, investor optimism is filled to the brim. Framing our content for this check-in is a similar but new graph below, with updated statistics from Schaeffer’s Senior Quantitative Analyst Chris Prybal, comparing the first day of 2020, to Feb. 3, 2021.

First on the list is the 10-day buy-to-open equity-only put/call volume ratio, which sat at 0.42 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) in January of 2020. Now, the reading comes in even lower than it read back a few weeks ago, now at 0.32. This suggests that the reading continues to sit in the lower rungs of the last four years, ripe for call buyers to enter the ring, if our contrarian viewpoint stands.

The Options Clearing Corporation (OCC) all-exchange, equity-only, 10-day option put/call volume ratio also has dipped lower from when we last checked in. However, this ratio of 0.51 does remain just above the December 2020’s first-ever dip below 0.50. Contrary to the ISE/CBOE/PHLX data, this reading suggests calls continue to take precedent over puts for the OCC options traders.

Another point of interest for me was the S&P 500 Index (SPX) Growth/Value ratio. In our first check-in, the Growth/Value was extending its multi-month trend lower, though it did remain above the 2020 starting ratio of 1.52. An unprecedented and highly publicized 12 months then occurred for growth stocks, which saw the ratio balloon alongside the SPX, but then roll over and seemingly limp into 2021, even while the SPX retained its strength. Now, not only has the ratio reversed course but, it stands at 1.96, just shy of 2.0 -- a level not reached by the S&P Growth/Value since November 2020.

Circling back to the overarching question that arose as the theme to start 2021, what should you feed into in regards to market optimism? To echo Senior Market Strategist Matthew Timpane, it’s most ideal to allow price action guide your decisions and utilizing options that put less dollars at risk relative to equities. This way, optimism can be less of a gamble and more of a supported and calculated risk of "hope" for your trading.

Subscribers to Bernie Schaeffer's Chart of the Week received this commentary on Sunday, February 7.

This week kicked off with a bang, and virtually no sign that the extreme market volatility of last week had ever occurred. In fact, the major indexes closed Monday's session with records, as newly appointed Treasury Secretary Janet Yellen pleaded for more Covid-19 stimulus. However, by Tuesday, some investors began to take profits from the rally, resulting in a mixed session. That carried over to the next afternoon, and Wednesday saw volatile trading as a handful of stocks regained traction, and Federal Reserve Chairman Jerome Powell commented on the challenges the labor market will continue to face.

On Thursday, worse-than-expected weekly jobless claims data put further pressure on the major indexes, and the blue-chip went on to close below breakeven after earlier rising to an intraday high. To close out the week, Wall Street was aiming to brush off a worse-than-expected January jobs report on Friday, but by midday were taking a breather. Heading into the long weekend, the major indexes were on track for a slight pullback, though optimistic vaccine data sought to keep losses in check.

Pot Stocks Take Center Stage

We noted at one point that pot stocks could be the real winner of the new election cycle, and things are looking good for the growing industry. First off, Aphria (APHA) stock surged to a new all-time high thanks to a deal struck by pending merger partner Tilray (TLRY). Canopy Growth (CGC) reported stellar fiscal third-quarter results, boosted by an increased demand for weed products with stay-at-home orders still in effect. Elsewhere, Cronos (CRON) stock hit a record high, and a bull signal flashed on the charts that showed the equity could soar even higher. It wasn't all sunshine, however, as a bear note hit Aurora Cannabis (ACB) stock hard, in the wake of a disappointing earnings report.

Earnings Show No Sign of Slowing Down

Another round of big names reported earnings this week. Hasbro (HAS) reported a better-than-expected fourth quarter, thanks to a boost in board game sales. Take-Two (TTWO) was another game company that reported an impressive quarter, and the company expects to release 93 new games over the next five years. Shifting gears, LYFT (LYFT) reported losses, though they were smaller-than-expected as the pandemic rages on. Rounding things out, two major beverage companies turned in their reports. Specifically, Coca-Cola (KO) and PepsiCo (PEP) chimed in with earnings, though their responses to the reports ended their stocks on opposite ends of investor senitment.

Holiday-Shortened Week Full of Economic Data, Earnings

Despite a holiday-shortened week, there's still ample economic data for investors to digest, as well as a slew of earnings reports from companies like Applied Materials (AMAT), CVS Health (CVS), and Walmart (WMT). In the meantime, Schaeffer's Senior Quantitative Analyst Rocky White highlights two technical indicators that every bull should know. Also be sure to check out our Monday Morning Outlook, where Schaeffer's Senior V.P. of Research Todd Salamone helps bullish traders chase the market.

The upcoming holiday-shortened week will still bring a fair amount of economic data. Housing and consumer data will highlight the week, as will the usual initial and continuous jobless claims. Earnings season will continue as well. The list of upcoming reports includes Applied Materials (AMAT), CVS Health (CVS), Shopify (SHOP), SunPower (SPWR), and Walmart (WMT).

Below is a list of key market events scheduled for the upcoming week. All economic dates listed below are tentative and subject to change.

The market is closed, Monday, Feb. 15, in honor of President's Day. 

Tuesday, Feb. 16 will bring the Empire State Manufacturing Index.

It speeds up a bit by Wednesday, Feb. 17, with retail sales data, Producer Price Index (PPI), Core PPI, Industrial Production for January, and the Federal Open Market Committee (FOMC) minutes.

Thursday, Feb. 18, initial and continuing jobless claims are due out, along with housing data, January's import price index, and the Philadelphia Fed Manufacturing Index.  

To end the week, Friday, Feb. 19 will feature the Markit manufacturing PMI, Markit services PMI, and existing home sales. 

Today investors can look forward to unpacking another decent list of earnings reports as well as data on the consumer sentiment index. Please take note that the U.S. stock market will be closed on Monday, Feb. 15, in observation of Presidents Day. Trading will resume again on Tuesday, Feb. 16, with a normal schedule.

The following companies are slated to release quarterly earnings reports today, February 12:

Altra Industrial Motion Corp. (NASDAQ:AIMC -- $56.33) designs, produces, and markets a range of electromechanical power transmission motion control products. Altra Industrial Motion will report its fourth-quarter earnings of 2020 before the bell today.

American Axle & Manufacturing Holdings Inc. (NYSE:AXL -- $10.56) designs, engineers, and manufactures driveline and metal forming products. American Axle will report its fourth-quarter earnings of 2020 before the bell today.

CAE Inc. (NYSE:CAE -- $25.57) provides training solutions for the civil aviation, defence and security, and healthcare markets. CAE will report its third-quarter earnings of 2021 before the bell today.

Dominion Energy Inc. (NYSE:D -- $73.06) produces and transports energy. Dominion Energy will report its fourth-quarter earnings of 2020 before the bell today.

Enbridge Inc. (NYSE:ENB -- $35.08) operates as an energy infrastructure company. Enbridge will report its fourth-quarter earnings of 2020 before the bell today.

Fortis Inc. (NYSE:FTS -- $40.74) operates as an electric and gas utility company. Fortis will report its fourth-quarter earnings of 2020 before the bell today.

Huntsman Corp. (NYSE:HUN -- $28.26) manufactures and sells differentiated organic chemical products. Huntsman will report its fourth-quarter earnings of 2020 before the bell today.

Lincoln Electric Holdings Inc. (NASDAQ:LECO -- $116.36) designs, develops, manufactures, and sells welding, cutting, and brazing products. Lincoln Electric will report its fourth-quarter earnings of 2020 before the bell today.

Moody's Corp. (NYSE:MCO -- $278.66) provides credit ratings and assessment services; and credit, capital markets, and economic research, data, and analytical tools. Moody's will report its fourth-quarter earnings of 2020 before the bell today.

Madison Square Garden Entertainment Corp. (NYSE:MSGE -- $101.69) engages in the entertainment business. Madison Square Garden Entertainment will report its second-quarter earnings of 2021 before the bell today.

Proto Labs Inc. (NYSE:PRLB -- $200.74) operates as an e-commerce driven digital manufacturer of custom prototypes and on-demand production parts. Proto Labs will report its fourth-quarter earnings of 2020 before the bell today.

Sensient Technologies Corp. (NYSE:SXT -- $77.50) is a biopharmaceutical company. Sensient will report its fourth-quarter earnings of 2020 before the bell today.

Tufin Software Technologies Ltd. (NYSE:TUFN -- $18.51) develops, markets, and sells software-based solutions. Tufin Software will report its fourth-quarter earnings of 2020 before the bell today.

W.P. Carey Inc. (NYSE:WPC -- $69.05) is a real estate investment trust. Carey will report its fourth-quarter earnings of 2020 before the bell today.

Kadant Inc. (NYSE:KAI -- $146.16) supplies equipment and critical components. Kadant will report its fourth-quarter earnings of 2020 after the market closes today.

Myriad Genetics Inc. (NASDAQ:MYGN -- $30.14) is a molecular diagnostic company. Myriad Genetics will report its second-quarter earnings of 2021 after the market closes today.

Looking ahead to next week, the four-day week will still bring a fair amount of economic data. Housing and consumer data will highlight the week, as will the usual initial and continuous jobless claims. Earnings season will continue as well. The list of upcoming reports includes Applied Materials (AMAT), CVS Health (CVS), Shopify (SHOP), Sunpower (SPWR), and Walmart (WMT). All economic dates listed here are tentative and subject to change.

Pot producer Aurora Cannabis Inc (NYSE:ACB) is down 9% at $13.17 in pre-market trading, after receiving a downgrade from MKM Partners to "sell" in the wake of a disappointing fiscal second-quarter earnings report. The firm's reasoning was also attributed to two key concerns: Aurora's consumer cannabis revenue was down 17% from the first quarter -- its lowest level since the second quarter of 2019. In addition, there was no guidance for positive adjusted EBITDA, instead showing a fall from the first quarter.

Yesterday the shares traded as high as $18.93, before once again being rejected by the $19 level and settling at $14.47. Still, cannabis stocks have been some of the biggest movers of 2021, and ACB is no exception, having already posted a 51.6% lead, year-to-date. Now, the equity is testing support at its 20-day moving average, which captured a pullback in late January. 

Circling back to analyst sentiment, not all reactions to the company's earnings report were negative. In fact, at least three bull notes poured in for the equity, the biggest of which was a price-target hike to C$14 from Canaccord Genuity. Still, coming into today, all 11 covering firms recommended a "hold" or worse rating. And what's more, the stock's average 12-month price target of $8.24 is a 37.1% discount to current levels.

Lastly, short interest on Aurora Cannabis stock has shed 24.7% during the past two reporting periods, though it still accounts for a healthy 14.2% of the stock's total available float. At ACB's average pace of daily trading, it would take short sellers under a day to buy back their bearish bets.

 

Internet security name Verisign, Inc. (NASDAQ:VRSN) is on the rise today after the company announced fourth-quarter profits of $1.38 per shares, which came in seven cents higher than Wall Street's forecasts. Revenue, meanwhile, came in just below estimates. At last check, VRSN is up 1.3% at $207.15. 

VRSN has had a choppy year on the charts since it's steep March selloff and subsequent recovery. The $220 level, which has kept a tight lid on shares for the better part of the past two years, continued to do so, with its latest rejection occurring in late December. The equity is set to topple its 140-day moving average for the first time since an early Janauary bull gap. Year-to-date VRSN is down 5.5% for the year. 

While just three analysts cover Verisign stock, the majority consider it a "strong buy," with only one "hold" rating on the books. Meanwhile, the 12-month consensus price target of $240.58 is a 17.6% premium to last night's close. 

Option traders were also optimistic on VRSN ahead of the event. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), VRSN sports a 50-day call/put volume ratio of 11.03, which stands higher than all but 3% of readings from the past year. This means calls are being picked up at a much quicker-than-usual clip.