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Technical Action Yesterday
Technical action by S&P 500 stocks was quietly bullish yesterday. Six S&P 500 stocks broke resistance (Disney, Google, Gap Stores, King Pharmacy, Ross Stores, Target Stores and none broke support. The Up/Down ratio improved from 2.29 to (290/123=) 2.36.
Technical action by TSX Composites stocks was quiet. Two TSX stocks broke resistance (Systems Xcellence and Toronto Dominion) and one stock broke support (CML Healthcare). The Up/Down ratio slipped from 2.31 to (125/55=) 2.27.
Federal Government Budget Impact
Market response to the federal government’s budget released after the close last night was minimal. The Canadian Dollar was virtually unchanged.
Chart courtesy of StockCharts.com www.stockcharts.com
Tech Talk’s Weekly Column in Saturday’s Financial Post
(Available in hard copy or by paid subscription at www.nationalpost.com).
The focus is on the Canadian Dollar.
FP Trading Desk Headline
Headline reads, “Finding the next ten bagger at PDAC” Following is a link to the report:
Look for lots of good news from the annual Prospectors and Developers convention this year. The conference runs from March 7th to March 10th. Metal prices are high and rising. Companies are flush with cash. Exploration activity has ramped up. The major producers are looking to acquire smaller companies with promising prospects. Encouraging news will help the TSX Metals & Mining Index. The Index appears poised to test its January high at 1,668.83. MACD continues to recover from a short term oversold level. ‘Tis the season for the sector to move higher!
Chart courtesy of StockCharts.com www.stockcharts.com
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. Retail, U.S. Oil Exploration & Production, U.S. Energy 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 $10.40 March 4 2010
· High 10.46
· Low 10.40
· Bid 10.30×5 lots
· Ask 10.41×7 lots
· Volume 3,300
· Open 10.41
· Previous Close 10.40
· 52-week High 10.65 on Jan 18
· 52-week Low 9.44 on Feb 5
· Beta 2.37
· Net Asset Value per unit: $10.38, up $0.02
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Discussions from the Tech Talk Forum:
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March 5th, 2010 at 6:43 am
Hi Don,
I wonder what is your thought on BNK.TO?
Thanks
Reza
March 5th, 2010 at 7:58 am
Hi Don,
Can you tell us (again, maybe) what ETFs traded in Canada you would recommend for the metals and mining play?
March 5th, 2010 at 8:09 am
Hi Don
Great call on FNX. Thank you yet again!
Neil
March 5th, 2010 at 9:30 am
Don , russell 2000 and s&p 400 are over January highs . S&p 500 and nasdaq 100 not there yet . They will go to new highs in march or in april after earnings ? or in the fall ? VIX is coming closer to the low of January 16.86 , can go under ? What is your opinion ? or hopes ?
March 5th, 2010 at 10:52 am
Hello Don
Dont you feel S.To is way overbought and perhaps we should wait for a pullback to closer to its breakout? Thanks.
March 5th, 2010 at 11:44 am
Hi Don,
Do feel that commoties are over bought right now and should expect a pull back in the short term?
March 5th, 2010 at 11:45 am
oops meant to say commodities
March 5th, 2010 at 12:44 pm
Isabela GP, CMW is one of them.
March 5th, 2010 at 1:05 pm
Hello Don,
Is the Mid Term Year on the 4 Year Election Cycle still a relevant seasonal chart? Thank you.
Ana
March 5th, 2010 at 1:14 pm
I am a regular reader of your daily report and weekly FP column and find the technical analysis you provide to be very useful. I notice that many of the charts you provide in your reports are from stockcharts.com. Recently, some of the charts you have referred to are from EquityClock.com. I have compared the seasonal charts for from these 2 sources and they are usually quite similar, with some slight variances which I expect are due to slightly different time ranges for each chart. However, in a few cases (eg Natural Gas Futures), there is a wide variance between the chart from stockcharts (last 17 years) and EquityClock (last 19 years). Stockcharts shows an average seasonal increase in Natural Gas Futures of about 8% from early March to late April, while EquityClock indicates only a 1% increase. Do you know why the huge variation and do you have a preference toward using the charts from 1 of these sources over the other?
March 6th, 2010 at 12:03 am
Hello Don
Where’s resistance for CLF -Cliffs? Thanks
March 7th, 2010 at 12:47 pm
Hi Reza. BNK recorded a breakout on higher than average volume on Wednesday and has continued to move higher on big volume. On balance volume shows strong accumulation. Something is going on here.
March 7th, 2010 at 12:51 pm
Hi Isabela. Two unleveraged ETFs are available: Claymore’s Global Mining ETF (CMW) and BMO’s Global Mining Equally Weighted ETF (ZMT). Horizons also has a double leveraged Global Mining ETF.
March 7th, 2010 at 12:55 pm
Hi Rick Smith. NASDAQ Composite broke above its January high at the close on Friday to reach a 17 month high. U.S. equity markets currently are short term overbought, but continue to trend higher. Other major U.S. equity indices (DJIA, S&P 500, DJIT) are testing their January highs and have a good chance of breaking to new highs given favourable seasonal influences until at least early May.
March 7th, 2010 at 1:00 pm
Hi Roy. Yes, short term momentum indicators for S are overbought. However,individual stocks within the Mines and Metal sector are showing exceptional momentum with many poised to break to new highs. S was one of the first to break. Preferred strategy is to buy stocks in the sector that are poised to break above resistance ratner than to chase S.
March 7th, 2010 at 1:04 pm
Hi David. Yes, momentum indicators for industrial commodities are short term overbought, but indicators continue to trend higher. Preferred strategy is to accumulate on any weakness. Seasonal influences on most industrial commodities remain positive until May.
March 7th, 2010 at 2:12 pm
Hi Ana. Following is a link to the SeasonalCharts.com site showing the seasonality of the U.S. equity market during a Mid-term election year. The chart shows upside until May followed by choppy down markets until November followed by a strong recovery to the end of the year. U.S. equity markets currently are following this pattern.
http://www.seasonalcharts.com/zyklen_wahl_dowjones_midterm.html
March 7th, 2010 at 2:27 pm
Hi Don Baydack. Best guess is that you are referring to SeasonCharts.com (Not StockChart.com). EquityClock.com is a relatively new service introduced on this site about three weeks. It was chosen partially because the service provides up-to-date reports on a large and varied list of indices, commodities and currencies (As opposed to a limited number of reports offered by SeasonalCharts.com based on data for 2007 and earlier). Natural gas is the classic example of variation in the two services because natural gas prices have been wildly volatile during the past three years. Seasonality charts on both services usually are similar, but they clearly are not for natural gas. EquityClock.com also offers seasonality charts on individual stocks, a service that is not available at SeasonalCharts.com