ShareThis
Pre-opening Comments for Wednesday February 3rd
U.S. equity index futures are slightly lower this morning. Futures responded to the ADP Payroll survey, frequently an early indicator of the monthly employment report to be released on Friday showed a 22,000 reduction in employment in the private sector. Consensus was a gain of 20,000.
More evidence of a recovery in commodity prices has surfaced. Belrussian Potash announced a 6% increase in potash prices. Demand for fertilizer once again is increasing.
Imperial Oil reported less than expected fourth quarter earnings. Consensus was $0.65 versus $0.76 per share last year. Actual was $0.55 per share. The decline in profitability by its refining and marketing division was notable. Look for refiners in North America to take action to increase profitability in their refining operations. Gasoline prices will move higher this spring.
Enbridge reported slightly less than consensus earnings. However, the company also announced a 15% increase in its dividend.
Pfizer is down 2% after reporting slightly lower than consensus fourth quarter earnings.
Time Warner reported higher than expected quarterly earnings and raised its dividend.
Goldman Sachs made several recommendation changes in the energy sector. Canadian Natural Gas, Occidental Petroleum and Petrobras were upgraded from Buy to Conviction Buy. Suncor was downgraded from Conviction Buy to Buy.
McDonalds added 1% after Goldman Sachs raised its rating from Buy to Conviction Buy.
Deutsche Bank initiated coverage on the gold sector. Kinross was rated a Buy with a target price of $21. Newmont was rated a Buy with a target price of $66.
Deutsche Bank upgraded United Parcel Services from Hold to Buy. Target price was raised from $67 to $70.
Walmart added 1% after Stifel Nicolaus raised its rating from Hold to Buy. Target price is $62.
UBS upgraded the Mining and Metals sector. Notable among upgraded stocks was Anglo American.
Technical Action Yesterday
Technical action by S&P 500 stocks was quietly bullish yesterday. Two S&P 500 stocks broke resistance (DR Horton, Lexmark) and none broke support. The Up/Down ratio improved from 2.91 to (312/106=) 2.94.
Technical action by TSX Composite stocks was quiet yesterday. One TSX stock broke resistance (Finning International) and one stock broke support (Cott Corp.). The Up/Down ratio slipped from 2.51 to (132/54=) 2.44.
Interesting Charts
Lots of positive technical action yesterday by a variety of charts including major U.S. and Canadian equity indices, several sectors that normally enter their period of seasonal strength at this time of year and even HAC. Positive technical signals in most cases included:
- A daily price range above a previous price range
- Stochastics recovering above 20%
- RSI recovering above 30%
- MACD showing signs of bottoming below the zero line (i.e. oversold)
Following are the charts and their technical indicators:
Chart courtesy of StockCharts.com www.stockcharts.com
Chart courtesy of StockCharts.com www.stockcharts.com
Chart courtesy of StockCharts.com www.stockcharts.com
Chart courtesy of StockCharts.com www.stockcharts.com
Chart courtesy of StockCharts.com www.stockcharts.com
Chart courtesy of StockCharts.com www.stockcharts.com
Chart courtesy of StockCharts.com www.stockcharts.com
An important reason for strength in equity markets and commodity sensitive sectors is growing technical evidence that the U.S. Dollar recently passed at least a short term peak. It found resistance near the 79.5 level and its momentum indicators are starting to roll over from a short term overbought level.
Chart courtesy of StockCharts.com www.stockcharts.com
CSTA News
Next Oakville CSTA meeting is scheduled on Tuesday February 9th at 7:00 PM at the offices of CastleMoore. Location is 2441 Lakeshore Road West. Recent MTA podcasts with Jake Bernstein and Dennis Gartman will be reviewed. Everyone is welcome (Membership is not a requirement).
Next Kitchener/Waterloo/Cambridge CSTA meeting is scheduled on Thursday January 11th at 7:00 PM. Location is RBC Dominion Securities, 3rd floor, 95 King Street South in Waterloo. Everyone is welcome.
Headlines from the FP Trading Desk
Headline reads, “Nickel prices will rise”. Following is the link
http://network.nationalpost.com/np/blogs/tradingdesk/archive/2010/02/02/nickel-prices-will-rise.aspx
Tech Talk comment: Nickel is one of many commodities that recently have established intermediate uptrends. Others include lumber and chemicals. Rising prices and rising volumes in basic materials set the stage for a significant seasonal move in the U.S. Materials sector.
Headline reads, ”U.S. Stock Market Ready to Roar”. Following is a link to the report: http://network.nationalpost.com/np/blogs/tradingdesk/archive/2010/02/02/u-s-stock-market-ready-to-roar.aspx
Thackray’s 2010 Investor’s Guide
Tech Talk frequently mentions Brooke Thackray and his book entitled, “Thackray’s 2010 Investor’s Guide”. The book summarizes attractive seasonal trades that are available during the year. The book can be purchased directly at Amazon.ca and Amazon.com. Following are links to these book stores:
Seasonal trades in the book that currently are active include Consumer Discretionary, Small Cap, Platinum, U.S. Materials, U.S. Oil Exploration & Production and Metals & Mining.
Disclaimer: Comments and opinions offered in this report at www.timingthemarket.ca are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed.
Don Vialoux is a research analyst for JovInvestment Management Inc. All of the views expressed herein are the personal views of the author and are not necessarily the views of JovInvestment Management Inc., although any of the recommendations found herein may be reflected in positions or transactions in the various client portfolios managed by JovInvestment Management Inc
HAP Seasonal Rotation E.T.F. | HAC-T $10.10 February 2 2010
|
Open |
10.050 |
|
- |
|
|
High |
10.100 |
- |
||
|
Low |
9.970 |
- |
||
|
Bid x15 |
|
- |
||
|
Ask x5 |
|
- |
||
|
Volume |
8,029 |
- |
||
|
52-wk High 01/18 |
10.650 |
- |
||
|
52-wk Low 01/29 |
9.750 |
- |
![clip_image012[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2010/02/clip_image01211.gif "clip_image012[1]"){kind=small}
Net Asset Value per unit: $10.07
| Sponsored By... |
|
|
February 3rd, 2010 at 7:16 am
Morning Don,I’ve never seen you use a chart like this-what do u think of it’s usefulness?
http://www.stocktiming.com/Tuesday-DailyMarketUpdate.htm
February 3rd, 2010 at 7:54 am
Hi folks,
I viewed this and learnt alot from it:
Check out this contrarian commentary .. lots of technical analysis and info:
http://www.youtube.com/watch?v=H3V6Eqfl1uU&feature=pyv&ad=4058840680&kw=contrarian%20trading
February 3rd, 2010 at 9:46 am
What is the most useful MA for volume?
February 3rd, 2010 at 12:00 pm
Hello Tim,
The chart claims to plot “liquidity”. What is that ? If the data is not readily available it would not be of much use. Thanks.
February 3rd, 2010 at 12:28 pm
Don,
When will you and Brooke post the holdings within HAC as of January 31st? Is there a way to view the holdings on a daily basis? Thanks.
February 3rd, 2010 at 9:40 pm
Don,
Been a while since we’ve seen you on BNN, great to see you on. Wish they would have you back more often. I’ll throw my question at you here since I was not able to get it through on the show.
Between PAA, SLW or SSO, which one do you feel is a safer bet based on fundamentals and TA ? Which one has the most potential upside within the period of seasonality for silver ? The fundamentals for SSO did not look too good to me.
Regards,
Richard
February 3rd, 2010 at 9:49 pm
Don,
You mentioned on BNN tonite that EWZ recorded a buy signal on Tuesday. Could the same be said for CBQ? Or do you see Brazil outperforming the BRIC countries? Thanks.
February 3rd, 2010 at 10:00 pm
Hello Don,
Could you please comment on Nucor(NUE) with regard to TA, seasonality and a good entry point ? Also, which do you prefer or think is a better buy, MT or NUE ? Thanks so much!
Joe
February 3rd, 2010 at 10:06 pm
Don,
In his January newsletter Brooke felt that IWM could possibly hit its target of $75 by March. Do you still see this is possible after the correction we have had ? Secondly, is XSU a better choice as opposed to IWM to play small cap seasonality ?
Joe
February 3rd, 2010 at 11:19 pm
Hi Don
I heard your interview tonight on BNN. I was impressed with your analysis. AT this time I am managing some of my portfolio and I think I may need some help as things seem to be getting more difficult. I seem to have trouble figuring out when to buy and sell and keep missing the targets. I don’t know if you can help me and I don’t know if you are a portfolio manager or just an analyst. Would you drop me a line and let me know if you can provide me with some assistance.
Thank you and hope to hear back from you soon.
Joe P.
February 4th, 2010 at 6:35 am
Richard .. Don goes on Market Call when it’s strategically interesting. Like yesterday to tell the energy and base metals story. Been following his pick for years now … he is a god.