Tech Talk for Friday March 1st 2013

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Pre-opening Comments for Friday March 1st

U.S. equity index futures are lower this morning. S&P 500 futures fell 7 points in pre-opening trade. Futures are responding to news that China’s official Purchasing Manager’s Index slipped in February to 50.1 from 50.4 in January. Consensus was 50.5. The Index fell to its lowest level in five months.

Traders are waiting for news about the Sequester following a meeting between President Obama and Congressional leaders at 10:00 AM EST.

Index futures were virtually unchanged following release of economic news at 8:30 AM EST. Consensus for January Personal Income was a drop of 2.4% versus a gain of 2.6% in January. Actual was a drop of 3.6%. Consensus for January Personal Spending was an increase of 0.2% versus a gain of 0.2% in December. Actual was an increase of 0.2%.

Canada’ economy continued to sputter in the fourth quarter. Consensus for annualized real GDP growth in the fourth quarter was 0.6%. Actual was 0.6%. Consensus for December real GDP was a decline of 0.2%. Actual was a decline of 0.2%.

Target added $0.04 to $63.00 after Wells Fargo upgraded the stock from Market Perform to Outperform.

Wendy’s slipped $0.01 to $5.69 after Morgan Stanley downgraded the stock from Overweight to Market Weight.

Visa fell $1.53 to $157.11 after Argus downgraded the stock from Buy to Hold.

AIG eased $0.55 to $37.46 after Evercore downgraded the stock from Overweight to Equal Weight.

Darden Restaurants (DRI $46.27) are expected to open lower after UBS downgraded the stock from Buy to Neutral.


Interesting Charts

Mixed trading yesterday! A couple of exceptions, Biotech and Canadian Financials! Both closed at an all-time closing high.




Adrienne Toghraie’s “Trader’s Coach” Column


The Philosopher Trader

By Adrienne Toghraie, Trader’s Success Coach

So, you are thinking, what in the world does philosophy have to do with making money in the market? If your answer is, “Nothing,” think again!

Why have a philosophy of life for traders?

Traders cannot trade successfully without having a set of rules by which they come in and out of the markets. Having a philosophy for a trader is like having a larger set of rules, in which his trading rules are merely a subset. Just like a ship, a trader needs a rudder to guide him through untested or turbulent waters. That rudder is a trader’s philosophy of life, and it is essential to providing stability and direction in a very stressful, high-risk


A trader’s philosophy on life will allow him to better handle the losses and wins he experiences during the day, the mistakes he makes, and helps him to put everything into perspective. It can answer the hard and the simple questions that come up for him, making his life easier and creating meaning to the randomness of his work. Having a philosophy is not the same thing as performing a daily meditation or subscribing to a particular religious practice or having a set of goals. A philosophy encompasses all aspects of a trader’s universe, and provides a way of framing the unanswerable questions and thorny issues that arise from moment to moment in a trading day.

A short list

Let me give you an example of what I mean. My own philosophy of life can be boiled down to three statements. They may seem simple on the surface, but they are as profound as I choose to make them. And, more importantly, they answer all questions, resolve all issues, give me guidance when I need it, provide me with my rules of conduct, and prepare me for all contingencies. They also provide a way to resolve and frame issues and

questions that a trader deals with, as well. In order, they are:

1. Life is precious

In a world where all things seem to become increasingly relative, (including values, morality, standards of conduct, agreements, promises, rules, laws, etc.) the one constant in our lives is that life is precious and that every moment of it can either mean something or be squandered. Thus, whenever I am faced with a decision, I apply this principle and act accordingly. I take that trip, call that friend, make that decision, and embrace as much joy from life as I can. I see the sand falling more and more rapidly from the top of the hourglass.

For you as a trader, it means that you must look at your personal life as well. Your children are growing up, and you need to spend time with them. Your health has its own hourglass and cannot be squandered, so handle stress and take good care of your physical and emotional health. It means that to waste that precious time on mediocrity in any form is just that: a waste. So, if you are going to read and learn, then read books by and learn from great minds; if you are going to watch television and movies, spend time with wonderful, uplifting artists; if you are going to socialize, do so with people you love and not with people you have nothing in common with and who do not care about you. Make your mark now. The future may not be there. Here’s the usual question to

which I apply this principle: Should I do that? The answer is, life is precious. And that understanding always provides me the impetus to act (or not) accordingly.

2. We are all connected

Life may be short, but we are in it with everyone else. We are all connected. What you do affects others. The decisions you make and the actions you take do not end with yourself. If Columbia University’s physicist, Dr. Brian Greene, is correct and the String Theory is real, then this philosophical principle that we are all connected is more than a cloyingly annoying statement on a Hallmark card, and we truly are, actually, connected to each other. This notion provides a balance to rule number one. If I decide that life is precious, and I should utilize each moment to its fullest, I must also do so in a way that takes into account the effect my decisions and actions have on others. For traders, this adds an ethical component to their lives. Like rule number one, it also strengthens the relationships in his life that provide him with support and sustainability. For example, it is difficult to conduct your business in a way that detracts from the happiness and wellbeing of your family members if you stay conscious of the fact that you are actually connected to them.

3. People are unique

This simple philosophy actually distills for me a lifetime of observing the most remarkable, irrational, saintly/evil and random behavior of humanity. I watch with a sense of calm as others ponder in anger and frustration the questions of “why?” and “how could they do that?” Why did that driver in the far left lane just exit off the highway in front of me at 80 miles an hour across four lanes of traffic? Madness of that sort no longer bothers me because I simply remind myself that people are unique. This philosophy allows me to expect the best, the worst, the most irrational, and the most unanticipated from those around me. For traders, it is the perfect insulation from the unpredictability and irrationality of their business associates, family, and friends, as well as the market.

Your philosophy to-do list

So, now that you have my own set of philosophical principles, what about your own? Here is a to a to-do list to help you put together your own guiding principles:

1. Ask yourself – What do I believe about life?

2. Ask yourself – What are my own guiding principles? Do not worry if the answer does not come immediately. It will. Just keep asking and over time, the answer will come to you.

3. Write down your thoughts.

4. Distill them into a set of principles.

5. Write down a set of actions that will support your principles.

6. Put them on a card that you carry with you and on a note that you can see from your workplace.

7. Set them to memory by reading them every day.

8. Let them guide your decisions and actions.

9. Now, enjoy the peace they will give you and the support they will offer your trading.

Adrienne’s Free Webinars

Adrienne presents free webinars on the psychology of trading


Updates on Sector Seasonal Trades

Seasonal trades optimally have a technical score of 3 based on (1) uptrend, (2) trading above its 20 day moving average and (3) outperforming the market (S&P 500 for U.S. holdings, TSX for Canadian holdings). Scores moving lower than 3 are warnings signs. A score of 0-0.5 is a sell signal.

Last week, the following seasonal trades fell to a technical score of 0.5 or 0.0 and therefore were sell candidates: Forest Products (WOOD), Materials SPDRs (XLB), Copper (JJC), Platinum (PPLT), TSX Energy (XEG), Oil Services (OIH) and Metals & Mining SPDRs (XME). Accordingly, they have not been updated in this report.

The following seasonal trades have a technical score of 1.0 or higher and currently are in their period of seasonal strength. Their retention is recommended.

Technical score for Industrial SPDRs increased from 2.0 to 3.0 when units moved above their 20 day moving average. Seasonal influences are positive until early May.


Technical score for Consumer Discretionary SPDRs increased from 1.0 to 2.5 when units recovered above their 20 day moving average and strength relative to the S&P 500 changed from neutral to positive. Seasonal influences are positive until mid-April


Technical score for Retail SPDRs changed from 2.0 to 1.5 when strength relative to the S&P 500 Index changed from positive to neutral. Seasonal influences are positive until mid-April


Technical score for the Semiconductor ETF increased last week from 1.5 to 2.0 when units moved above their 20 day moving average. Favourable seasonal influences end next week.


Technical score for Palladium was unchanged at 1.0. Seasonal influences are positive until mid-April


Technical score for U.S. Oil and Gas Exploration units remains at 1.0. Seasonal influences are favourable until mid-April.


Technical score on Energy SPDRs remains at 1.0. Seasonal influences are positive until the end of April.


Technical score for gasoline changed from 3.0 to 1.0 after units fell below their 20 day moving average and after strength relative to the S&P 500 Index changed from positive to negative.


Technical score for iShares on the TSX Financial Index is 3.0: Upward trend, trades above its 20 day moving average and strength relative to the TSX Composite is positive. Seasonal influences are positive until mid-April.



Special Free Services available through is offering free access to a data base showing seasonal studies on individual stocks and sectors. The data base holds seasonality studies on over 1000 big and moderate cap securities and indices. Notice that most of the seasonality charts have been updated recently.

To login, simply go to

Following is an example:

The Boeing Company (NYSE:BA) Seasonal Chart



Disclaimer: Comments and opinions offered in this report at 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 and Jon Vialoux are research analysts for Horizons Investment Management Inc. All of the views expressed herein are the personal views of the authors and are not necessarily the views of Horizons Investment Management Inc., although any of the recommendations found herein may be reflected in positions or transactions in the various client portfolios managed by Horizons Investment Management Inc

Horizons Seasonal Rotation ETF HAC February 28th 2013


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41 Responses to “Tech Talk for Friday March 1st 2013”

  1. Tawny Says:$INDU&p=D&yr=0&mn=9&dy=0&id=p44472930287&a=286271991

  2. Freddebuoy Says:

    Hi Tawny, thanks for the chart. I’ve added the MACD which is my favourite tool for finding divergences – its more sensitive than RSI in my humble opinion.$INDU&p=D&b=5&g=0&id=p93653489718&a=294526408

    We are seeing a lot of similar patterns. For example, ZEO.TO, BMO’s Equal Weight Banks.

    Also, check out this chart. Notice when the 20 day MA NYSE AD diverges from the prices, a downturn follows.$NYAD&p=D&yr=1&mn=0&dy=0&id=p10261406527&a=272028670

  3. Tawny Says:


    Re #2 : Thanks for your charts too. I really like to check in on Ciovacco Twitter to see his tweets and charts – keeps me on track I think.,

    NTR: Re Vancouver Island.. I have not taken time lately except to print out some weather histories for the Victoria area, compared to Vancouver and to Kingston.
    Victoria are is very appealing – the stress of a move is not!

    I still think it does not make sense for us to buy a home for our latter years, renting seems better. Unless, one puts money into a house and takes out a reverse mortgage of some kind when cash runs out… which it will for us. And one needs to have cash if one ends up in a retirement home. Just trying to be prudent.

  4. Rami/AB Says:

    Hi All,
    I Bought some UVXY and I am hoping for a spike toward the end of the day. I might buy buy so HVU.TO too.

  5. Rami/AB Says:

    I meant I might buy HVU too

  6. tony Says:

    Hey Éric W. have you been grounded or are you sipping a corona on a beach. May I remind you your my age even tho we have 60 years to go we got to keep in shape and not abuse to much of a good thing 😉

  7. tony Says:


    about renting or buying… at a young age its better to own a house as value increases in time,but once we have health issues then its time to sell it and enjoy what we can…

  8. Paul Says:

    Tony, thank you for your responses yesterday ! Paul

  9. Lee Says:

    Moving to Victoria? Probably the sunniest place in all of Canada. Twassessen and White Rock also get similar amounts of sun. If your in your later years renting is the safest way to go. No Real Estate risk and reverse mortgages are awful. It is relatively easy to get a fairly secure income of 4%-5% on larger amount of capital. good luck!

    RE: UVXY

    Today was a perfect setup for a day trade. Big gap up folled by some a few nice up and downs. UVXY is the better one to trade right now as the acb on HVU is far too low. Horizons really needs to reverse split it. I have no idea what they are waiting for. Also check out HVI for an overnight hedge. Works well.

  10. Tawny Says:


    Thank you for commenting on renting in latter years… seems wisest to me. Good health now, but once into senior years one never knows…. we will downsize (again) and really lighten up on “stuff.” Any suggestions on source for fairly secure income on a chunk of capital?

    Do you day trade UVXY in and out during the day… curuious?

  11. Tawny Says:


    Last time I checked it out… our home here in Kingston has appreciated well, but doubt that we could buy in Victoria with the proceeds, unless we buy a garden shed to live in!

  12. nrg Says:


    Big haircut on price on Atlantic Power after dividend cut from 1.13 to .40

  13. tony Says:


    look at the volume in the last few days, makes me think of a friend quote its like a race horse, nervous to enter in the box once in it wants to reach the finish line 1st.

  14. tony Says:


    well ok you can probably buy a little lot 10×10 and have a beautiful garden…just like in montreal 😛

  15. tony Says:


    the best place to put your money is in real estate, as it has the potential to grow, some rei, cuf, cwt, HR, are just a few names.

    then you have the canadian banks they increased their dividend, they must feel comfortable with the canadian debt level,

  16. Tawny Says:


    I doubt that I would put much of the proceeds from our house into the markets… maybe a little… guess that depends on the markets at the time I have the money in hand tho’. When you are in senior years you cannot take that much risk as way less time to make back any losses.

  17. Tawny Says:


    We have been having the end/month beg/month effect – next week could be different.

  18. tony Says:


    thx for ATP,

    I cut one of my high dividend payers to a 100 shares… just in case they decide to go the same route by monday. my indicators are on a day trade positive but we never know what to expect by monday…

  19. tony Says:

    I would never suggest how much money you need to put in the market…

    I’m only suggesting where to put some money as you need that money to close your months…

  20. Freddebuoy Says:

    Tawny, most studies have suggested that it is better to rent than to own (there was an article in the Financial Post a few days ago. However (there’s always an “however”) the caveat is that you must save/invest the capital you are not spending on your house. And that’s quite the caveat. Where do you invest to get the same return as your real estate? That’s not intended to be rhetorical. And how’s your own returns over the past few years? In our family, we have made more on our house (were we to sell) than in the market.

    You should try to find various articles on the subject. It seems to me that it would make a difference on whether you intend to carry a mortgage or if you have the cash from a previous sale to have clear title. If you have a clear title, you have no mortgage payments and are therefore in a position to save even further. Rents on the other hand, are expensive.

    And the time expected to be in the home is also important. As in all financial planning, many assumptions must be made.

    For me, I would never rent over buy!

  21. tony Says:


    I was reading post 20 from FreddeB, I came to realize I forgot one company…chartwell

    being an owner and tenant at the same time what can you ask they will pay you to stay with them…and sorry to say this but we have an aging population so you’re sure you there shouldn’t be to many empty appartments.

  22. tony Says:


    one last comment on renting vs buying…

    Éric Wheatly has posted a comment on the subject a few weeks ago on this site.

  23. dougp Says:


    I have lived in Victoria for a total of 28 years, always in our own house, long since paid off. So now its a question of preserving capital in it in an uncertain economic environment, whether its for our kids, or for, heaven forbid, a rest home. A good friend, a successful realtor here, has recently sold up, and moved into a rental. He loves it, and thinks condos are for the birds. No worries on fees, repairs, insurance etc. And here’s Victoria’s black swan: if we ever see a major earthquake here, it will wreck all property owner’s investments. Check out what has happened to real estate in Christchurch NZ. Have a nice weekend (by the way, its a balmy 11 degrees today… we are having a good winter.)

  24. Neil AB Says:

    Mavis, Tony, Hniel
    You expressed interest on my take of the free Larry Berman evening.
    Basically, I thought it was ok, certainly not a waste of time. It was pretty “low level” in terms of analysis, but, that was to be expected going in. Given a room of 200 people, things have to be presented in a fairly general way. Even so, there were a couple of nuggets to be taken away.
    What are they selling?: I totally agree with Mavis both that Ziad (Larry’s partner) is a really bright engaging guy and that there is absolutely no pressure put to sign up for anything. So, don’t not go because you think there is going to be some pressure of any sort put on you. There is no pressure whatever. They are, and they very candidly admit, in a business. Their business is selling their knowledge of the markets and how they move. So, they are selling a weekend course (approx. $1300.00) in investing based on their trading strategies and skills. My take was that Larry was also, though very very subtly selling his services for those who were not able, for whatever reason, to trade these markets (buy and hold is dead, one must be active in these markets, if you don’t fully understand the markets get help from someone…(though never suggested it be him)).
    So, that’s why they do these free things, and, to me, that’s fair enough. Again, and I can’t emphasize enough that there is no “sales pitch” or pressure whatsoever.
    In terms of their investing approach, it is very “top down”. That is, very “macro” oriented for swing trading. So, the approach is Globally, where are things moving (into the $usd for safety, or away for more risk trade). Then, how is the S&P doing in relation to moves in the usd, then, what sectors of the s&p are outperforming, then, what stocks in those outperforming sectors are doing best – that sort of thing.
    One quite interesting idea I gleaned was, if swing trading, (not applicable perhaps for long time holders or daytraders) was to ease into a postion. If things look good at set up point, put in 1/3 of your allocated resourses, if they continue looking good, add. Don’t go all in at one time.
    That is the basics. If anyone has any questions I’d be happy to try to answer them. All in all, a pleasant Wednesday night in Edmonton (few and far between). Even got coffee and a croissant – bonus.

  25. Neil AB Says:

    As you may recall I’m a fellow CLQ holder, just wondering what the heck’s been going on lately. Been getting kicked pretty hard for no apparent reason. Any info? I know production is to start at the end of March, perhaps the market is thinking there will be delays??? Doesn’t make sense to me (but then not much does). Any info you have would be really appreciated.

  26. Neil AB Says:

    Couldn’t take all my former wives to the seminar cause they had limited space. Besides, I was only going there to look for a new wife anyway…might have found her – lucky number 7?

  27. tony Says:

    Thx Neil

    Well the class my better half took strategy follows canuck strategy maximum allocation is 5% but to do so u must go in 10% per month

  28. tony Says:


    Maybe you’ll find her in a hobby of yours like investing, who knows maybe she ll be an investment guru

  29. Tawny Says:


    Thanks you for your post on home rental in #23. Could you elaborate on the Realtor’s rental – rented an apt. or condo in high rise? Hope you come back here this weekend to answer that. I think we will want to rent a small garden level town home as we have 2 small dogs that we can’t simply disown :) I have a dirty passion too – gardening! LOL Even if it is a small patio for potted plants.


    I thank you too for your post on rentals vs. buying. Understand your desire to always own… and agree about the good fortune in owning one’s home.. I doubled our investment in the home I designed and built in Kelowna. We have done well with our home here in Kingston too (although like any investment – it is just a paper profit until sold.)

    Our situation: If a nail needs to be bagged, tis’ I who do it. If something needs to be fixed, guess who does it? I do all the gardening, digging, planting. Clean the garage and the basement. Perhaps you are getting the picture? As well I handle all finances, cooking, cleaning, decorating, etc. etc. And there comes a time when one becomes less able to “do it all.” Although I have no serious disease I now have degeneration in cervical spine (thanks to childhood fall down stairs) Maintaining a house becomes too much. Which is why many retirees buy a condo… which is not for me… I have read enough and also was a Realtor for a while many years ago in VAncouver. I do not want to be in group ownership. Period. Did once back in Montreal back in the 80’s – oh and a difficult real estate market developed and it was not easy to sell.

    Also, if you look into the future, you will see that as we age our health declines at some point. One may face a retirement home or nursing care facility. Houses do actually have ups and downs in values just like the capital markets and are not all that liquid at every point in time. If you need to sell quickly due to failing health you may be forced to sell into a poor R.E. market. My husband is about to turn 80 this month. He may need to go into a retirement home within the next 5 – 10 years maybe sooner.. Also I have no intention of leaving this earth with money tied up in a house. I hope to spend every last dime I have worked so hard for… and yes, I did most of the earning.

    We cannot always think about our future from where we stand in the present but rather from where we might “be” in the future. (Tawny)

    So these are some of my thoughts thinking ahead to our possible future from the present. Whew!

  30. Tawny Says:

    Market has been going nowhere…

    “As the markets have demonstrated several times in recent weeks, when the risk-reward profile becomes unfavorable, gains can be “taken back” quickly. The S&P 500 closed February 1 at 1513. In the last month it has gained a grand total of 5 points, closing today at 1518. The close three weeks ago was 1518, meaning no gains have been made in three weeks of volatile (can’t sleep at night) trading. We have missed nothing, but will keep an open mind heading into next week.” Ciovacco

  31. Mavis Says:

    Hi Neil:

    Thanks for your thoughts on the Larry Berman event.

    I sold my CLQ last week. It’s been a fundamental hold for me for a long time and in trying to make sense of my holdings I thought it was time to apply TA to it. I’m still high on the company and lithium over the long term. The plan is to buy it back and I have a standing order for .65, although we’ll see what happens if it gets close. Run the risk of missing opportunity if the price shoots up fast.

    Who really knows the reasons for the slump, although it’s in keeping with the Canadian materials sector. There’ve been no insider sales. I’m counting on there being no good(sales or production)news at least until the end of this month and buying back before then. This is the end of CLQ’s pre-production time and the beginning of real production.

  32. Freddebuoy Says:

    Hi Tawny. On Thursday, you mentioned an ETF that invested worldwide with minimum volatility. I thought, “what a fantastic idea”. But there is limited history. Does it really work in the long term? So I went into the MSCI website to see what I could learn there. And (it’s a fabulous site, by the way) here is a video about minimum volatility indexes – it is, in my opinion, a worthwhile half hour:

  33. Edmonton Says:

    I see some people talking about real estate. Does anyone know how much does it cost (roughly) on the island, to build a house (per sqare footage). Thanks for your reply a head of time.


    Some of these were good shorts in february. hindsight.

  35. dougp Says:

    re #29 Tawny

    My said friend (who is 80, with younger wife) is renting a 3rd floor 2 br apartment, which is the top floor, waterfront if you can believe that, in Oak Bay as well. It is very much dated, but fine for all that. He has a potted plant “garden” on his large balcony. His is an unusually good find (I think he pays about $2200 per month) but there are a lot of nice older apartments in Oak Bay. The only way to make a decision is to come here for a house-hunting trip, and this is not a bad time of year to do it. Victoria is extremely “regionalized,” with each region having its peculiarities, good and bad.

    #33 Edmonton

    Can’t give figures, but I don’t see why it should be very different from elswhere in Canada. Its the land that determines price differences, and it is high in Victoria. Again, highly regional.

  36. Tawny Says:


    Thanks for expanding info in #35. Older buildings can be very beautiful and spacious with lovely architectural features not being built today. If they are updated – even better. No condo fees in rentals. You are right about a house-hunting trip. I might take a trip soon to explore.

  37. Tawny Says:


    Re MSCI — I went in to that website too. Saw the video was long and I was doing other things, so quit. Will look at it soon.

    Were you able to find any symbols for theses low volatility products? Other than IShares that is? Time I spent there, I could not – I was busy and got frustrated. I have more to do these days than I am able to cope with.

  38. Rol Lew Says:

    Re #30 – There were some spots with good positive returns for feb.,CUS.TO,nti,ALDW,CLMT,TSO,MPC,FGP,PBF,ARII,KEX,TRN,|D|A12,26,9

    Most of these are oil refiners and transporters of oil /liquids to and from refineries. This party is 7 months old. Who knows if the music will stop tomorrow?

    Again, hindsight is 20/20.

    Foresight is only 50/50 at best, but we just keep trying.

  39. Rol Lew Says:

    1 dozen that went up in Feb, From IBD- top 50 this weekend.,CTRX,FLT,ALK,AWAY,SLCA,EVR,MPC,OPEN,UTHR,PKG,VRSN|B|A12,26,9

    Can/ Will this continue? 50/50 at best.

  40. Neil AB Says:

    Re: 33
    I have a place on the “island”. Sorry, your question is, I think, just too general to be able to reasonably answer. Like anywhere else, so much would depend on what kind of house and where you would be looking to build (it is, after all, a big and diverse island). I just don’t see a way to answer. I would suggest you check vireb (vancouver island real estate board) website. It will give you a basic idea of house prices in the various localities. Perhaps you can get an idea from that. I would say that this is a generally down time on the island. A few years ago lots of american money was coming in and that has pretty much dried up which has sent prices down. So, probably not a bad time to be looking.

  41. Tawny Says:


    Have a question – just ask Google…,or.r_gc.r_pw.r_cp.r_qf.&bvm=bv.43148975,d.aWc&fp=53af1a3df64f305a&ion=1&biw=1356&bih=674

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