Tech Talk for Tuesday August 8th 2017

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Pre-opening Comments for Tuesday August 8th

U.S. equity index futures were lower this morning. S&P 500 futures were down 3 points in pre-opening trade.

Second quarter earnings reports continue to pour in. Reporting companies since yesterday’s close included Avis, CBS, CVS Caremark, Dean Foods, Manitowoc, Marriott, Michael Kors, Ralph Lauren, SeaWorld, Sealed Air, Tenet Healthcare and Valeant.

Eastman Chemical (EMN $84.45) is expected to open higher after Cowen raised its target price to $92 from $88.

Netflix gained $0.37 to $181.70 after Piper Jaffray raised its target price to $215 from $198.

AMC Entertainment (AMC $16.10) is expected to open lower after RBC Capital lowered its target price to $22 from $30.

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2017/08/06/stock-market-outlook-for-august-8-2017/

Note seasonality charts on Non-farm Payrolls, Canadian Employment and the U.S. Dollar Index

StockTwits Released Yesterday @EquityClock

Goldman Sachs $GS, a Dow Jones Industrial stock moved above $230.64 extending an intermediate uptrend.

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Fertilizer ETF $SOIL moved above $9.75 extending an intermediate uptrend

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Technical action by S&P 500 stocks to 10:00: Quietly bullish. Breakouts: $MAR $TRIP $GS. No breakdowns.

Editor’s Note: After 10:00 AM EDT, breakouts included BBY and XEL. Breakdown: CHK.

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for August 7th 2017

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for August 4th 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 August 7th 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 slipped 0.47 to 62.73 yesterday. It remains intermediate overbought and trending down.

 

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Don and Jon Vialoux are speakers at this year’s MoneyShow Toronto

Topic:  Expected equity trends during the first 18 months of a Trump Administration

 

History shows that election of a Republican president following a two term Democrat president does not go well during the first nine months of his Presidency. Changes in Washington move slower than anticipated and the President’s mandates are delayed. Thereafter, a bull market in the U.S. ensues and the Canadian equity market goes along for the ride.

 

The MoneyShow Toronto 2017

September 8-9, 2017

Metro Toronto Convention Centre


The MoneyShow Toronto 2017 is the premier education event for self-directed investors and active traders in Canada. Your no-cost, two-day pass will give you unlimited access to meet and hear from the most successful experts in 60+ interactive workshops covering exciting array of topics to fit your investing and trading needs. Join us as we speak about the topic above. Whatever your experience, portfolio size, or risk posture, you simply cannot afford to miss this event. Visit https://goo.gl/PMkw5X for information on registration, speakers, workshops, and more!

 

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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36 Responses to “Tech Talk for Tuesday August 8th 2017”

  1. polish1 Says:

    Low Volatility S&P
    A fascinating statistic about the current no-vol state of the market, courtesy of Deutsche’s Jim Reid, who points out that the last time we had 13 consecutive days in which the S&P moved less than 0.3% in either direction was… never:

    … all you really need to know about markets at the moment is that yesterday’s move in the S&P 500 (+0.16%) added to the record daily run of less than 0.3% moves in either direction. It’s now 13 days since we had a larger move using daily data back to 1927. The second longest streak of this length was of 10 days which has happened twice in history. The most recent time was in England’s solitary football World Cup winning year (06 Jan 1966 – 19 Jan 1966), and the other between 15 Nov 1961 and 29 Nov 1961. So these continue to be remarkable financial times we are living through.

    To put the steady but relentless rally in the S&P in context, it is now 73 trading days since the S&P increased by more than 1% in any one day. Give it another 7 days and we will beat the prior record set back in November 06 and March 07. Although, given the current lull in the activity (VIX now back to below 10), we might even get close to the 100 day record set back in mid-July 1995 to early Dec 1995.
    Earlier this year, the Dow recorded its lowest one-month trading range since 1900, and last summer the S&P traded within a 1.77% range for 42 consecutive days, the tightest such streak in history (the lull was ultimately broken on 9-Sep-16, when the S&P 500 dropped 2.45% on ECB policy, North Korea, and a fear of higher rates in the US).

  2. Larry/ON Says:

    August Bull Market Continues! – Glad I didn’t sell and go into hiding. New all-time highs coming for the SP500 this month. Financials are the ticket now. If you get preoccupied with seasonality you lose the macro big picture which is extremely bullish. 90% of the people who sold waiting for a correction will be buying back in at higher prices.

  3. Ron/BC Says:

    Larry/ON
    Well the bull market in the U.S. may be continuing but the $TSX failed to clear and hold above the 2014 high of 3 years ago and rolled over and is still weak. Oils continue to be weak with Oil still in the $40 range and Canadian financials are still well below the February highs they set 6 months ago. And Oil stocks and Financial stocks are more than 2/3 of the $TSX. So the bull market is not continuing for most Canadians as they tend to own $TSX based stocks overall. Add to that many commodity stocks and the results are not impressive. And the major Canadian brokerages tend to hold Canadian stocks for their clients. I know my partner saw her financial statement from a major brokerage last month down thousands of dollars and it is not an aggressive fund. Good to be positive but one needs to be realistic too with their investments.

    http://stockcharts.com/h-sc/ui?s=%24TSX&p=D&yr=5&mn=0&dy=0&id=p13325144229&a=415291117

    http://stockcharts.com/h-sc/ui?s=CM.TO&p=D&yr=1&mn=8&dy=0&id=p14580044994&a=515744251

  4. Larry/ON Says:

    RON/BC – CM – I really think we are soon going to see another short squeeze on CM. CM has outperformed ZEB since June 28th. Try a chart of CM.TO:ZEB.TO I am in agreement with Brian Belski’s position on Canadian banks. Attached is today’s Globe and Mail that describes it. By the time people realize what is happening the easy money is already made. I already have a five figure profit on CM. SP500 about to hit 2500.

    https://www.theglobeandmail.com/globe-investor/inside-the-market/canadian-stocks-poised-for-second-half-bounce-back/article35890823/?1502208100810

  5. Ron/BC Says:

    For those waiting to buy Gold stocks due to their positive seasonality wait for price to clear and hold above $12.30 resistance on the Gold Stock ETF:XGD.to for a reversal signal back to up of some magnitude. After that, 1st resistance is the downtrendline. $GOLD itself needs to clear $1300 to breakout of its long term downtrend.

    http://stockcharts.com/h-sc/ui?s=XGD.TO&p=D&yr=1&mn=0&dy=0&id=p47492981720&a=469547255

    http://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=10&mn=0&dy=0&id=p93782511151&a=453195481

  6. Ron/BC Says:

    Larry/ON
    Well the chart I posted with the major CD banks on it show CM.to the weakest of them all by a long shot. The ZEB.to is an ETF of them all and only averages them all. There are hundreds of analysts who post reports in the Globe and Mail and generally talk their book which simply means if they are bullish they are long the stock and are just trying to pump up other buyers for personal gain. And if they wish to be quoted in the Globe and Mail and other media sites they must have something original and unique to get posted. So I don’t tend to give much credence to any of them. What I often do if finding someone I think has some ‘vision’ is write down their thoughts on paper with a date and just stack these types up and then look back after a few weeks or months and see just how accurate they were. Not too many it seems are that great. What is really being missed is Canadian investors that bought U.S. dollar based stocks and investments have seen the value of those investments plunge with the sharp drop in the U.S.$ since late last year plus the rise in the CD$. What ‘appears’ to be gains are in reality losses with the huge currency difference. Even the charts of same stocks on both exchanges of the $TSX and NYSE the charts are dramatically different. Some of the CD Banks look ok and have recently broken out on the NYSE while the same bank stocks on the $TSX are still trading sideways and no where near their February highs. But as always the charts will tell everyone what and when to buy not some hot shot posting a story in the Globe and Mail. Those guys are just making a living and talking their book. He’s just being a cheerleader for the banks. Ultimately the CD banks should do just fine overall with higher odds of success than most companies. But for investment timing watch the charts for reality not another story.

  7. Sandra Says:

    Hi Ron/BC:
    Thanks for your view on bull market.

    When you do get a chance can you update us on TECK/b.TO and ECA.TO chart. Thanks!

  8. Ron/BC Says:

    The Emerging Markets ETF:EEM is once again at long term major price resistance at $44. Big test once again. I wonder if this is going to be like Lucy holding the football for Charlie Brown and then pulling it away at the last second again. “OR” does he get to kick it over the cross bar for a field goal (breakout) this time…………

    http://stockcharts.com/h-sc/ui?s=EEM&p=D&yr=15&mn=0&dy=0&id=p17818519602&a=524225263

  9. Ron/BC Says:

    Sandra
    ECA.to broke below $11.50 support but after creating a small W pattern broke back up above that level again. Always good to see a false breakdown and reverse. Price now needs to clear price resistance at $13.50 which is also the downtrendline to suggest up again.

    And as far as TECK/B.to goes recall mentioning a buy at $19 some time ago. That time has passed and price is now overbought and closing in on its downtrendline. I wouldn’t buy it here for sure. It did clear $26 resistance quickly but isn’t worth chasing now.

    http://stockcharts.com/h-sc/ui?s=ECA.TO&p=D&yr=2&mn=0&dy=0&id=p76178810522&a=482347801

    http://stockcharts.com/h-sc/ui?s=TECK%2FB.TO&p=D&yr=2&mn=0&dy=0&id=p24549413584&a=491071783

  10. Larry/ON Says:

    Re.6 – Ok RON/BC – We each have different viewpoints on CM. I have my own fundamental and technical analysis method that works for me. It doesn’t bother me that CM or the other banks are not near their Feb/March highs. It means there is more value.

  11. dutchcanuck Says:

    Larry/ON
    Understand why you like CM. It went down more than the other banks, so now it’s reverting to the mean. It cannot hold a candle to the recent performance of CWB.TO. Your comments are very assertive and I find that useful in my own analysis, but I wish I could be that sure about the future, especially when it comes to the market.
    Good luck with CM.

  12. Sandra Says:

    Ron/BC:
    Thanks for # 9 on ECA and TECK.

    Is this a cup and handle on weekly copper chart? How do you explain it? Still learing 🙂

    http://stockcharts.com/h-sc/ui?s=%24COPPER&p=W&yr=5&mn=0&dy=0&id=p89066050952&a=497730115

  13. Larry/ON Says:

    DutchCanuck – I am an old-fashioned value guy. We have Canadian banks that retreated, bottomed and are now building some buying interest. At the same time I have David Rosenberg on TV talking about $CAD moving to higher levels over the next six months. You win on two fronts. If CWB works for you and you know what makes that company tick then that is the one for you. You are making a bet on Alberta there. I am not oblivious to the fact that Sept and Oct are soon here. I just do my value analysis and tell myself almost everything I own like CM and EQB are undervalued and I don’t want to part with my shares until I am offered a higher price for them that I know is coming. The key for me to hold any stock is to have as close to absolute confidence as I can get. Otherwise I can’t trade objectively. We are in a bull market that will go to much higher levels for financials. I do not fear a correction. I will just add.

  14. polish1 Says:

    dutchcanuck
    I hope that you took some of the table(CM.TO] and let the rest ride,i hate giving up a profit.

  15. polish1 Says:

    dutchcanuck

    Correction CWB.TO

  16. Larry/ON Says:

    Polish 1 – CWB is overbought but could continue overbought for some time more. You could wait for it to show some kind of technical weakness before selling. It is building some awesome momentum here. I would love to know how much short interest was put on and at what levels. It would fit the bill for the US short sellers who know nothing about Canadian banks. I talked about CM eventually having a short squeeze but it could actually be happening on CWB. Personally if I held a lot of shares I would sell small portions above $30 at progressively higher levels. Someone put a single buy limit order for 20,000 shares of CM at 109.07 that has been sitting there all afternoon.

  17. Sandra Says:

    Confused…. Copper has gone up today (low 2.87 high 2.92) but stocks are not moving with it. Anyone any explanation.

  18. polish1 Says:

    Larry/ON
    Good luck with your trading.

  19. kam Says:

    Kam Says:
    July 27th, 2017 at 3:22 pm
    Ana,
    That sounded like a quick iv. We still haven’t touched 2487-2500 yet so a pretty good chance that one more higher high is on way unless we go below 2450 than it is over.
    I had Svxy and QQQ puts from yesterday and sold them when QQQ closed gap at 143ish. Will try to load them later if SPX moves higher from here. Hopefully I get another chance.”

    Now, SPX

    Minimum wave 3 Target has been hit for SPX as it hit 2488. Will that mean it will correct here? Hard to say. It can still do a minor pull and end up to 2500 or even over shoot that.
    Please do remember this target is 1.618 extension of Wave 1 & 2 which is a target for wave 3. Wait and watch. I am looking to get some Oct or Nov puts as I type. SPY, I will think about 240-45 and maybe selling 228-230 puts to fund it. QQQ might buy 135-140 and svxy 70-80.

  20. dutchcanuck Says:

    Polish1 #15
    Nope.

  21. dutchcanuck Says:

    Sandra #17
    Mine are. TECK/B, HBM, CMMC.

  22. dutchcanuck Says:

    Neil/AB
    Photon Control has signed an exclusive distribution deal with Ace Instruments for the OIL&GAS industry. The Photon Flow meters are a really good fit for measuring flows especially flaring of natural which needs to be reported to the Ecology police.
    PHO up nicely again today.

  23. dutchcanuck Says:

    BIP/UN has a nice pop today on great volume. About 7+%. Guest it is starting to sink in that the earnings they reported were pretty darned good and skewed by non-cash currency hedges. As it is the stock is somewhat overvalued, but the $30B investments are starting to reap results.

  24. Ron/BC Says:

    Sandra
    Cup and handle patterns are simply a selloff with a completed rounding bottom that comes back to its starting point but instead of breaking out above that cup edge trades sideways for sometime consolidating. You have to see what traders were actually doing within these patterns like all patterns and it will make sense. So the longer the handle the more bullish the breakout over the handle. And the handle itself is simply in a trading range or channel of its own. So what’s happened is price has recovered the entire selloff of the cup and consolidated in a trading channel. These patterns though are complex plus take time to build. And the cup handle varies from short to long. I’ve seen many of them fail to rally strongly and just see price rally the depth of the handle and then fizzle out. Too complex a pattern to totally rely on but you can always buy the breakout of the handle if its ‘consistent’ in price and you might do exceptionally well. I wouldn’t bet on a Weekly chart as they can take forever to develop. But this pattern is rarer than Head and Shoulder patterns which are seen everywhere if you look for them and more H&S patterns fail to breakdown than breakout. Focus on support and resistance levels for a higher success rate with charts. And forget the complex patterns as well as all the b.s “stories” you read in the media.

    Copper did breakout of its 6 year downtrendline in Dec and rallied through 1st resistance at 2.46 forming a bulish flag. Price is now testing important price resistance at 2.94. Clearing this would be very bullish and suggest much higher. And technically you often see two Flags in a row. Note the close correlation of the other commodity based markets overlaid.

    http://stockcharts.com/h-sc/ui?s=%24COPPER&p=D&yr=20&mn=0&dy=0&id=p64298549855&a=406318057

  25. dutchcanuck Says:

    Sandra #12
    While you are waiting for RON/BC answer.
    Yes, it’s a cup&handle or we could even argue that it’s a inverse head and shoulders. The chart shows 2 breakouts on good volume. Base metals usually do well during the final upswing in a bull market, so this could be it.

  26. Larry/ON Says:

    CWB and CM both lining up for a high close. 12 minutes to go.

  27. Ron/BC Says:

    Great day on the golf course today!!!!!

  28. Ron/BC Says:

    Dutchcanuck brings up a good point about seeing other chart ‘patterns’ within another pattern. If you look hard enough you can often see a few patterns within each other that all tell you the ‘real story’. Some short term bullish but perhaps within a long term bearish pattern. Meaning up on the short term but don’t fall in love with it so dump it and the 1st resistance point. Like when I bought XGD.to and dumped it 2-3 days later for enough cash to pay for my fancy new golf driver. That was a very weak dead cat bounce off price support within a bearish Descending Triangle and only bounced for 2-3 days before selling off and breaking support as the bearish Descending Triangle suggested would happen. I should not have made that trade really but wanted someone or something to pay for that club,lol. So learn to look for these patterns and understand what is taking place with all the investors/traders who are buying and selling them. No guarantees of course as things do change and traders/investors do change their minds and get margin calls etc but overall they do tell you what’s going on.

  29. Mick/NV Says:

    AAPL gapped above the R1 pivot point resistance last week after it’s earnings beat, today price closed above the R2 pivot point resistance and into overbought territory. The stock has performed well this year , up around 39%, has increased 100% over the past 5 years. It is also becoming a dividend grower, increasing its dividend each year for the past 6 , that will probably continue going forward. Yields only 1.5% but don’t need a big yielder to increase value. Have owned this one for awhile, would like to see it drop to around $150 and cover the gap before adding.

    http://stockcharts.com/h-sc/ui?s=AAPL&p=D&b=5&g=0&id=p22049006420&a=382463347

  30. Paula Says:

    Thanks Ron/BC for updates and charts on XGD.TO, ECA.TO and TECK.b.TO. These are all quite volatile and I tend to lump them in the same category of high risk/high reward (potential).

    For those of us who like to pick individual stocks, as well as time the market (who can resist?), here is a sobering podcast:

    http://freakonomics.com/podcast/stupidest-money/

  31. Neil/Ab Says:

    5N plus
    So, 5Is take is still somewhat mixed.
    Pros are cost reductions, margin improvements, earnings improvements resulting in a better balance sheet. Insiders have been buying.
    Cons are that “it is hard to get excited” with revenues being 1/2 what they were 5 years ago and a share count that has gone from 45m to 80m since 2008.
    Sounds to me that they are saying an investor would be looking at a turnaround story (my words not theirs) and that while things are improving, they are not yet convinced.
    While not prepared to jump on now, I will continue to follow this one for awhile. It interests me, especially with the recent improvements.

  32. Neil/Ab Says:

    Dutchcanuck
    Thanks for the PHO update. Added a bit, think this one could be decent.

  33. Sandra Says:

    Ron/BC and Dutchcanuck, thank you very much for the charts and explanations. Always appreciated.

    Ron/BC:
    I wanted to add Teck/b.TO to one of family accounts to average down. I should have done it at 20 as it did move up as per your chart. It is over bought but if copper, met coal and zinc is going up and there is deal in works with India then I think it will keep going up even in overbought position. What do u think .. right now it is hugging upper BB and keeps moving higher.
    Thanks in advance for your comments.

    PS Some Gold and silver charts showing positive divergence and now we have Trump’s tweet so let us see what happens tomorrow. Gold was up $8 earlier.
    “North Korea said on Wednesday it is “carefully examining” plans for a missile strike on the U.S. Pacific territory of Guam, just hours after U.S. President Donald Trump told the North that any threat to the United States would be met with “fire and fury.”

  34. Sandra Says:

    Dutchcanuck:

    CMMC : why did it drop to .47. I try not to trade such cheap stocks. I have been burnt by LIM.TO earlier when I first started trading. This is $1 is it safe to trade?

  35. dutchcanuck Says:

    Sandra #34
    I received the stock for services rendered. Did not buy in the market.
    It is not a stock I would buy. Having said that the garbage stocks do best in the initial phase of an upmarket.

  36. polish1 Says:

    STAR OF THE WEEK
    http://stockcharts.com/h-sc/ui?s=BITCF&p=D&yr=0&mn=6&dy=0&id=p67075385192&a=534243970&listNum=59

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