Tech Talk for Friday June 9th 2017

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Pre-opening Comments for Friday June 9th

U.S. equity index futures were mixed this morning. S&P 500 futures were unchanged in pre-opening trade.

The British Pound fell following release of results from the United Kingdom election. The Conservative party won a minority election, but has combined with the Ulster Unionist party to form a new government.

The Canadian Dollar rallied on a better than expected increase in Canadian May employment. Consensus was a gain of 11,000 versus a gain of 3,200 in April. Actual was 54,500. Consensus for the May Unemployment Rate was 6.6% versus 6.5% in April. Actual was 6.6%

Urban Outfitters slipped $0.01 to $16.34 after the company issued a downbeat sales outlook. SunTrust lowered its target price to $21 from $25.

Aetna (AET $149.31) is expected to open higher after RBC Capital raised its target price to $162 from $147.

Boston Scientific (BSX $27.91) is expected to open higher after RBC Capital raised its target price to $31 to $29.

Encana added $0.05 to $8.96 after announcing the sale of its Piceance natural gas asset for $735 miilion.

Starbucks (SBUX $62.50), McDonalds (MCD $151.5) and Chipotle (CMG $459.69) are expected to open higher after Mizoho initiated coverage with a Buy rating

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2017/06/08/stock-market-outlook-for-june-9-2017/

Note seasonality charts on the Financial sector, Russell 2000, Initial Claims, Continuing Claims, Natural Gas Storage and Natural Gas.

Observations

China awakens

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Copper prices responded.

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Ditto for copper stocks!

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Copper prices normally move higher until the end of July.

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StockTwits Released Yesterday @EquityClock

Oil falling back to the lower limit of a declining trend channel. See

http://www.equityclock.com/2017/06/07/stock-market-outlook-for-june-8-2017/

Technical action by S&P 500 stocks: Quietly bullish. Breakouts: $YHOO $C $STT. No breakdowns.

Editor’s Note: After 10:00 AM EDT, breakouts included TIF, ZBH, ETFC, MS, TROW and ZION. Breakdown: TJX. Bank stock responded to news that the House of Representatives introduced a bill to curtail regulatory requirements previously imposed by Dodd-Frank. Regional bank stocks and its related ETF were notably stronger.

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U.S. Metals & Mining ETF $XME moved above $30.22 developing a short term uptrend

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BMO Base Metals ETF $ZMT.CA moved above $9.69 establishing a short term uptrend.

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Editor’s Note: Seasonal influences are positive on real and relative basis for the base metal sector until the end of July.

S&P/TSX Capped Diversified Metals Seasonal Chart

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^GSPTTMN Relative to the S&P 500
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Trader’s Corner

Daily Seasonal/Technical Equity Trends for June 8th 2017

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for June 8th 2017

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Green: Increase from previous day

Red: Decrease from previous day

* Excludes adjustment from rollover of futures contracts

Daily Seasonal/Technical Sector Trends for June 8th 2017

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Green: Increase from previous day

Red: Decrease from previous day

 

S&P 500 Momentum Barometer

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The Barometer gained 1.80 to 65.20 yesterday. It remains intermediate overbought.

 

TSX Momentum Barometer

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The Barometer added 2.69 to 44.08 yesterday. It remains intermediate neutral and in a downward trend.

 

Disclaimer: Seasonality and technical ratings offered in this report and www.equityclock.com 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

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24 Responses to “Tech Talk for Friday June 9th 2017”

  1. Larry/ON Says:

    Canadian Banks -Payday has arrived! The Canadian economy is firing on all cylinders with a great jobs report. Interest rate increases coming and the international investors are scrambling to reverse all of the short Canada trades.

  2. Larry/ON Says:

    CM is the most under-owned Canadian bank. If the trade is reversing on Canada this is the one to own as it is the most domestic focused, most undervalued and the one with the highest dividend yield hence CM is up the most of the big banks this morning. Any one short is going to scramble to cover.

  3. dutchcanuck Says:

    Larry/Ont
    Great call you made on the banks a while back. Congrats.
    Personally bought TD & BNS.

  4. Sherri Says:

    Interesting read on European banks:

    https://www.armstrongeconomics.com/world-news/banking-crisis/bank-stocks-have-a-completely-new-risk/

  5. Ron/BC Says:

    HCG.to (Home Capital Group) just broke out above its selloff pattern resistance at $11.06. I read somewhere that heavy short sellers were still holding short. Never pays to ignore a nice profit and get greedy for more.(oink,oink.) There is no resistance between $11.06 and roughly $17. As long as price can hold above $11 there is lots of potential for much higher prices. Only thing stopping one from capturing a nice profit here is their own ego. Years ago I read a study that claimed traders and investors would rather be right than make money due to their egos and that’s what kept them in trades that continued to selloff. Even the best of the well known successful ones admitted they just couldn’t accept that they were wrong on an investment as that would put in question their own judgement. Will be interesting to see where this one goes and how these heavy hitters respond.

    http://stockcharts.com/h-sc/ui?s=HCG.TO&p=D&yr=1&mn=6&dy=0&id=p80658928495&a=525404692

  6. Ron/BC Says:

    RE:HCG.to
    Here is a long term chart of the stock for a better perspective.

    http://stockcharts.com/h-sc/ui?s=HCG.TO&p=D&yr=14&mn=0&dy=0&id=p78543181123&a=522700997

  7. Sherri Says:

    Watching T.T (Telus). Looking at a 3 year weekly chart, I see an inverted head and shoulders with a recent breakout which is now retesting the breakout. Or am I missing something? Any thoughts appreciated – don’t own any

  8. Ron/BC Says:

    The bank ETF:ZEB.to has bounced back to the March low that broke down in April. This $27 level needs to be cleared and held to suggest a rally to the broken uptrendline at $28. Still lots of work to do for these stocks that broke below their uptrendlines and price support levels to get back to solid uptrends again. CM.to is the weakest bank stock presently.

    http://stockcharts.com/h-sc/ui?s=ZEB.TO&p=D&yr=1&mn=6&dy=0&id=p77151989838&a=525411284

    http://stockcharts.com/h-sc/ui?s=ZEB.TO&p=D&yr=1&mn=4&dy=0&id=p31242094576&a=423336680

  9. Larry/ON Says:

    XLF – RON/BC – Could you have a technical look at this one because I think this will determine overall direction. This is my thesis. Financials ran up too quickly late 2016. We have been waiting for the 200 day MA to catch up. GS tagged the the 200 day and is now recovering. KRE came close to tagging and others like MS and JPM reversed before hitting the 200 day MA. XLF looks quite strong right now. Canadian financials are now starting a reevaluation based on fundamental factors that have been building and have lagged on price and therefore technicals. As long as US financials continue strong Canadian will follow.

  10. Ron/BC Says:

    Sherri
    Here is a chart of T.to. Nothing wrong with it technically. Shorter term support at $44.50 was tested again yesterday and bounced. Even the one year uptrendline is close by at $44 and the February/March high breakout point at $43.50.I don’t see anything wrong with the chart. A break below $44.50 would suggest a test of the uptrendline or even the February/March breakout point at $43.50.

    http://stockcharts.com/h-sc/ui?s=T.TO&p=D&yr=1&mn=6&dy=0&id=p80979229687&a=502812062

  11. Sherri Says:

    #10 Ron/BC
    Thanks very much. Wish I had a crystal ball to see if we get a bigger correction over the summer. Or even a flash crash just for fun!

  12. Ron/BC Says:

    Larry/ON
    Yes,lots of potential for the banks. Most CD banks have cleared their downtrendlines which is a good sign but have work to do to suggest a continuation of a strong uptrend. Might see some sideways action first for awhile. The charts will tell it best. ZEB.to clearing $27 will tell us a lot. Here is XLF with the 200ema and 200sma overlaid as well as GS and KRE. Price cleared its downtrendline and now needs to clear & hold above $24.09 to suggest a run to a double top to the early March high of $25.21. Without sounding like a broken record I have been wondering about the CD$ breaking back above 73.50 plus clearing 74 and holding despite Crude selling off hard. The CD$ is not acting like a market that wants to selloff further and suggests a more positive Canadian economy along with equities. That isn’t confirmed yet but is a heads up. Not surprised at the bounce back in banks but they still have work to do like any stocks that breakdown and need to claw it’s way back again. Much easier for a stock to maintain an uptrend,track sideways and continue to breakout. Not too many want to short a stock that is in a solid uptrend.

    http://stockcharts.com/h-sc/ui?s=XLF&p=D&yr=2&mn=0&dy=0&id=p71640493413&a=302769359

  13. Larry/ON Says:

    LB – This is the last Cdn bank laggard that I think is about to catch up.

  14. Bernie Says:

    Alpha Power Investing Newsletter – June 8, 2017
    The History of the Mid-Cap Power Zone
    http://www.alphaim.net/power_newsletter.html

    Tawny and I have commented on this strategy a few times. I don’t know the level of interest here but I thought I’d post a link to the latest newsletter for everyone. The strategy has had a very high success rate of positive returns and besting the S&P500 dating back to at least 35 years.

  15. NRG Says:

    ENB. Enbridge

    Joining Dutch and adding to my Enbridge holdings. 200 @ 52.00

    They have so many projects that have yet to pay off. I expect capital gains as these projects come online. Pays a nice 4.7% div. while you wait.

  16. kam Says:

    Sherri,

    #11,

    You have crystal ball which you might not no about. AMZN had a flash crash at 1150AM PST. Dropped from $960 to all the way $927 and back up within 4 seconds. here is how it went.
    2:50:01 p.m.: $960.55 per share
    2:50:02 p.m.: $930.00 per share
    2:50:03 p.m.: $953.07 per share
    2:50:03.5 p.m.: $927.00 per share
    2:50:04 p.m.: $959.27 per share

  17. Bernie Says:

    Re: 16 Flash Crash question

    I’m not a trader…just curious.
    Would those with stop losses on their holdings not be at greater risk of inopportune triggered sells during flash crashes?

  18. kam Says:

    #16,

    “Might not know about.”

    FANG+TSLA and AAPL stocks are feeling the pain a little, have moved up a LOT in last month so lots of hot air.
    Complacency is increasing day by day. VIX drop to 1993 low also is another sign.However these kind of events will reset it so stocks can climb the wall of worry again.
    However,Long term investors,holders should start trimming their holdings once we move north of 2500 SPX , just IMHO.Until then buy the dip or flash crash.

  19. kam Says:

    Bernie,

    Flash Crash,

    Stoploss are good and bad depending on one’s own perspective. Afterall one have a stoploss because it will stop your loss or book your gains. I won’t put a stoploss on EFTs but with individual stocks need to put limit stop. However if price dives overnight below your limit loss, it is useless.
    Anyone with a stop loss will lose more than they want to if they do ‘market’ stoploss orders. If one have ‘limit’ stop then stock will be only sold at that price or higher.
    Example with AMZN yesterday. If one have a stoploss with market at $950 then if no bid comes in then stock might have sold at $927. However if one have a limit stoploss order at $950, then it will only be sold at $950 or higher.

  20. Bernie Says:

    Kam,

    Re: #16
    Thanks, that is good advice for those wanting to apply stop losses.

  21. Ron/BC Says:

    Goldman Sachs said that the F.A.N.G stocks were like the Dot-Cop bubble and that triggered some serious selling. Looks like GS was short once again. Watch the broad market Monday as this could be a trigger for a more serious correction if it catches fire as these were the leaders along with other Tech stocks that were a major part of present averages. The May into October is typically the time major corrections occur and it has been a very long time since a major correction happened. So for those that love to add on the way down your dream come true scenario may just happen. Just depends on how the big boys want to play this…………..

  22. Bernie Says:

    Ron/BC,

    Are you still sitting in cash and waiting for the correction? I see many of the Mawer funds are back to form this year after having an off year in 2016. In hind site that would have been the more opportune time to buy in.
    http://www.mawer.com/assets/Daily-Report.pdf

  23. roy Says:

    SHOP took it on the chin as well as the FANG stocks

  24. Ron/BC Says:

    Bernie
    Yes I’m still in cash in my accounts. I have both my RRSP that I trade with along with my TFSA now at my brokerage. The RRSP cash is in U.S.$ and the TFSA in CD$. So I can trade or invest in either currency. I just could not deal with an investment that went nowhere for a year but still be exposed to risk. I see a lot of markets do this. The Financials of all types are looking like they are being rotated into with sold Tech money and the next couple of days should suggest where the overall market is going. I might be interested in an Insurance company such as Sunlife if the breakout holds. The Health care ETF:XLV recently broke out over major resistance as well. Not sure what I’ll do with my Tangerine money yet. Meanwhile it makes me money daily with no risk so I’ll need a good reason with a good chart to get invested. Too many options really. Nice to see interest rates increasing. I had fully expected they’d be in the 3% to 4% range by now but aren’t there yet. Not that keen on Oaken Financial even with their 3% interest on their 4 year GIC or 2.60% one year term. Nice rate but the risk is a bit much I suspect. So meanwhile I guess I’m just coasting along and enjoying life best I can. I see in the Pre market tonight things are selling off.

    http://stockcharts.com/h-sc/ui?s=SLF.TO&p=D&yr=2&mn=0&dy=0&id=p00471242850&a=385618518

    http://www.cnbc.com/pre-markets/

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