NEW YORK (TheStreet) -- Earnings continue with eight companies reporting their quarterly results after hours today or premarket on Friday. My buy-and-trade pre-earnings profiles represent stocks in five sectors in a market that remains extremely overvalued with 85.3% of all stocks overvalued 52.7% by 20% or more.
There is an interesting dynamic at play among these eight stocks as five will end the week with negative weekly chart profiles unless they rally enough to have weekly closes above their five-week modified moving averages. To review, a negative weekly chart is defined by a weekly close below its five-week MMA with 12x3x3 weekly slow stochastic readings declining below 80.00 on a scale of 00.00 to 100.00.
Three companies are in the computer and technology sector which is 35.7% overvalued with an overweight rating as 52.1% of the 1126 stocks in the sector have buy or strong buy ratings. This includes buy-rated Dow component Microsoft (MSFT) which stayed above its 200-day simple moving average on weakness to $34.31 on Jan. 14 with a day's low at $34.63. The stock must overcome a negative weekly chart profile.
Procter & Gamble (PG) is from the consumer staples sector which is 22% overvalued with an overweight rating as 60.3% of all stocks in the sector have buy or strong buy ratings. Dow component Procter & Gamble closed below its 200-day simple moving average for the first time since Oct. 9 and also must overcome a negative weekly chart profile.
Two companies are in the finance sector which is 22% overvalued with an equal-weight rating as 83.8% of the 2961 stocks in the sector have hold ratings. One of the two is another regional bank.
One is in the industrial products sector which is 28% overvalued with an equal-weight rating as 50.75 of the 339 stocks in the sector have hold ratings. Beware that 35.4% have sell or strong sell ratings.
One company is in the retail-wholesale sector which is 22.5% overvalued with an overweight rating as 82.8% of the 343 stocks in the sector have buy or strong buy ratings. We will see what's brewing at buy-rated Starbucks (SBUX) which fell below its 50-day SMA on Dec. 10 with its 200-day SMA at $71.79. The stock must also overcome a negative weekly chart after setting an all-time intraday high at $82.50 on Nov. 6.