Tech Talk for Wednesday November 29th 2017

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Pre-opening Comments for Wednesday November 29th

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

Index futures were virtually unchanged following release of the second estimate of U.S. third quarter real GDP at 8:30 AM EST. Consensus was growth at a 3.3% annualized rate versus growth at a 3.0% rate in the first estimate. Actual was 3.3%.

Tiffany gained $0.05 to $94.09 after reporting higher than consensus third quarter sales and earnings.

Royal Bank (RY Cdn$100.45) is expected to open higher after reporting higher than consensus fiscal fourth quarter earnings.

National Oilwell Varco added $0.16 to $32.29 after SunTrust raised its target price to $33 from $29.

UnitedHealth Group (UNH $216.14) is expected to open higher after RBC Capital raised its target price to $244 from $215.

Wal-Mart added $0.63 to $32.29 after RBC Capital raised its target price to $96 from $92

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2017/11/28/stock-market-outlook-for-november-29-2017/

Note seasonality charts on the U.S. Banks, Case/Shiller 20 City Home Price Index, Imports of Goods with World, Exports of Goods with World, Canadian Industrial Product Price Index and the Canadian Dollar.

Don Vialoux on BNN’s Market Call Tonight

Following are links to last night’s show:

https://www.bnn.ca/video/don-vialoux-s-top-picks~1272799 Top Picks

https://www.bnn.ca/video/don-vialoux-s-past-picks~1272761 Past Picks

https://www.bnn.ca/video/don-vialoux-s-market-outlook~1272698 Market Outlook

 

Notes used for the show:

 

Market Outlook

North American equity markets currently are following their traditional period of seasonal strength from mid-October to the first week in January. Sectors that historically have been strongest during this period are leading the way on the upside. These include Technology, Consumer Discretionary, Industrials and Materials sectors. The FAANG stocks have been by far the strongest influence on U.S. equity indices. However, medium term technical indicators show that equity markets and sectors are overbought and fewer stocks outside of the FAANG stocks are moving higher. Despite favourable seasonal influences, now is not the optimal time to be aggressive buyers of North American equities. Seasonal traders will take advantage of strength between now and early January by taking profits.

A few sectors have not participated in the upswing in North American equity market and have been under tax loss selling pressures in recent weeks. Pressures likely will continue until at least mid-December. Thereafter, some of these sectors will enter into their period of seasonal strength. These sectors include energy, oil services and precious metals. Preferred strategy is to place equities in these sectors on the “radar screen” for possible purchase when they show technical signs of bottoming.

 

Top Picks (Disclosure: None currently are held)

Wheaton Precious Metals (WPM on the TSX)

Seasonal influences are favourable between mid-December and the end of March. Technical parameters are positive: Intermediate trend is up. Strength relative to the S&P 500 Index and TSX Composite is positive. Momentum indicators are trending up.

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Van Eck Oil Services ETF (OIH)

Seasonal influences are favourable between mid-December and the end of February. Technical parameters are neutral: trend is flat. Relative strength and momentum indicators are neutral. Units complete a reverse head and shoulders pattern on a move above $26.27. Recently units have been under tax loss selling pressures. Higher drilling activity triggered by higher crude oil prices will help fourth quarter 2017 and first quarter 2018 revenues and earnings.

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Cash

It’s too late to be a buyer of recent outperforming equities/ ETFs and it’s too early to buy stocks under tax loss selling pressures. Patience will be rewarded.

 

Past Picks

Disclosure: XGD is held in a family account. SOIL is not held in any accounts. XGD remains a top pick. Profit taking in SOIL is recommended.

Seasonal influences for XGD turn higher from mid-December to the end of February.

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Viewer E-mails

#1,2,3,4,5,6,7,9,10

Social Media

Blogs: www.timingthemarket.ca

www.equityclock.com

 

StockTwits handle @equityclock

Observations

U.S. bank stocks spiked higher in late trading yesterday in anticipation of a tax deal

 

StockTwits Released Yesterday @EquityClock

Bank of Nova Scotia $BNS.CA moved below support on lower than consensus earnings.

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Visa $V, a Dow Jones Industrial stock moved above $112.71 to all-time high extending an intermediate uptrend.

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Technical action by S&P 500 stocks to 10:00: Bullish. Breakouts: $TMK $NOC $FLS $V. No breakdowns.

Editor’s Note: After 10:00 AM EST, breakouts included TMK, BWA, INFO, SNA, ETFC, BAX, MCD, BLK, CMA, DFS, LUK, NDAQ, RF, ZION, CAT, CHRW, CTAS, SWK and SHW. Breakdown: BSX.

Agnico-Eagle $AEM moved above $45.91 completing a double bottom pattern.

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‘Tis the season for Agnico Eagle $AEM to start moving higher to the end of Februay on a real and relative basis.

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Gilden Activewear $GIL.CA moved above resistance at $40.64 changing intermediate trend.

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Palladium ETN $PALL moved above $97.17 to an all-time high extending an intermediate uptrend. ’Tis the season!

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iShares Global Agriculture ETF $COW.CA moved above $40.89 to an all-time high extending uptrend.

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US Financials jumping at the start of period of seasonal strength. equityclock.com/2017/11/28/… $XLF $KBE $KRE $IYF

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Americans feeling a little wealthier with home prices up 0.4% in September. Avg Sept increase: 0.1%. #Housing $MACRO

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Below average gain in exports and above average increase in imports widen the trade deficit in October $MACRO $STUDY

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Canada Industrial Product Price Index up 1.0% in October, moving inverse to 0.2% avg. decline. #CDNecon #CAD $MACRO

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for November 28th 2017

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for November 28th 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 November 28th 2017

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Green: Increase from previous day

Red: Decrease from previous day

S&P 500 Momentum Barometer

The Barometer jumped 9.40 to 71.40 yesterday. It remains intermediate overbought.

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TSX Momentum Barometer

The Barometer dropped 1.43 to 55.42 yesterday. It remains intermediate overbought and trending down.

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Disclaimer: Seasonality and technical ratings offered in this report and at

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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13 Responses to “Tech Talk for Wednesday November 29th 2017”

  1. Ana Says:

    “Ana Says:
    November 21st, 2017 at 12:18 pm
    There is a large I H &S on $SPX $ES on the 5 hour and a small I H &S on the $SPX $ES 1 hour.
    The larger I H & S should take us up to 2612 – 2616.
    Might not be today, might have to back check to the break out.”

    When I posted this, I thought that the top of the shoulder of the $SPX $ES was at 2584 ish, but the middle of the shoulder back check was to 2592 ish. That put the target of the I H & S higher, I have the new target at 2629. We are higher than that now.

    The next calculation I made was E.W. (still a hack) for wave one to wave two is 11 – 13 ish. So the wave three to wave four should take us back down to 2618 – 2616 ish. So I was expecting that move for today.

    There is also divergence on the chart. But now we are at 2634. So I have no idea. But I bought into good old hvu.to for a small pull back. The higher we go the higher the target of the pull back will be.

  2. bruce Says:

    Sherri
    Armstrong has another vertical market update if you would be so kind to post it…..tnx….

  3. Larry/ON Says:

    US Financials Surge While Techs Drop – Interesting market. Financials have been the no-brainer trade to hang onto in a rising interest rate environment. Looks like profit taking in tech with some ammunition provided by an NVDA director’s sale of 600K worth of shares. Who knows why he sold? You can pick it up right now at the 50day MA if you have an iron stomach for volatility.

  4. Mick/NV Says:

    cnr.to dropped well below the s2 pivot point support this morning, unfortunately while I was still asleep, but, did pick up some shares below that level although not at the low point. Sometimes it pays to watch the market open. Stock is now way oversold.

    http://stockcharts.com/h-sc/ui?s=CNR.TO&p=D&b=5&g=0&id=p76204077528&a=450854173

  5. Rol Lew Says:

    Roy, S/A had also had a Jan 2017 post on lithiums.

    https://seekingalpha.com/article/4034589-top-12-lithium-miners-create-lithium-etf

    The major ETF’s contain a high % of non-lithium stocks.
    Do some of the juniors look like a bubble to you on a 1-year chart?

    http ://stockcharts.com/freecharts/candleglance.html?FMC,LIT,ML.V,LAC.TO,NMX.TO,ORL.TO,SLL.V,NLC.V,AAL.V,PILBF,ALTAF,FL.V|C|A12,26,9|0
    Pilbara PILBF & Altura ALTAF in production next year. Their main exchange is ASX-Australia.

  6. Paula Says:

    Mick/NV
    I have been waiting for a chance to buy more CNR.TO but I don’t think I missed my chance this morning. The uptrend that was in place since ~ mid 2016 was broken this summer and has been in a trading range. With today’s drop the trading range was broken to the down side. The extreme low today at 95.08 is a lower low. If it tests that level and does not hold, it could go down to test the next level ~ 92.

    http://stockcharts.com/h-sc/ui?s=CNR.TO&p=D&yr=2&mn=0&dy=0&id=p92862290928&a=458592655

  7. Larry/ON Says:

    Dow Transports – Massive Upward move today and yesterday. Bodes well for the market. CNR being a transport going counter to the others is not a good sign for that stock and the chart looks a bit scary breaking below the 200day MA and below 98. Have a look at FDX if you want a transport.

  8. Sherri Says:

    Important ARMSTRONG report on the DOW and the Vertical Market:

    “The mere fact that 23,700 has been a solid barrier is extremely important. Yesterday, the market exploded bursting through that barrier warning that we are indeed in a VERTICAL MARKET scenario. This means at some point it would be nice to see a retest of support, which would be a fall back to the top of the channel illustrated here on the Monthly level resting at 22,583 this month.

    Given the fact that we have blasted through the 23,700 number only after the ECM turning point on the weekend, is also a warning that which the high-end real estate market has peaked with that turning point, the capital flow is shifting from FIXED assets to MOVABLE assets the first week.

    Ideally, this week should form a turning point. The Directional Changes on the Daily level begin today and peak tomorrow. The market now has a choice. We either get the pull back and create a bear trap, of we simply move into a Cycle Inversion, which is common in VERTICAL MARKETS.

    A Cycle Inversion simply means that what should have declined flips and invests into a rally. The turning points are the same, they simply produce successive highs. This would be indicated if we continue to see new highs AFTER this week. Then if 2018 OPENS above the 2017 high, as they say, all hell will break lose.

    That support on a Daily closing basis is terribly important now at 23500. A close below that level will see a retest of support. As long as that level holds, then we can still press higher.

    The resistance stands at 23,899.71 and we reached 23,849.61 yesterday. Our technical projected resistance for today stands at 23,935.11 and 23,956.52 with support at 23,789.11 and 23,653.72. This is the trading range for a NORMAL market. Breakout out of the top warns we can still press higher and breaking 23,652.72 would then point to the test of 23,500.

    We are dealing with an extremely dangerous banking crisis in Europe that is wrapped up in a political crisis. The greater the external chaos continues, the more mad rush we will see into equities. Keep in mind this is parking money FIRST. So PE-Ratios and fundamental scenarios all fail.Because so many remain bearish, the market can easily trap the majority by simply running away causing them to eventually throw in the towel and buy the high because they do not understand what is taking place.”

  9. Mick/NV Says:

    Paula

    re: cnr.to

    Yesterday I was thinking the stock would drop further, I was not anticipating a 4% drop this morning though. I certainly would have preferred to add, in the $95 range but ended up buying just above $96, if the s2 support holds then I expect the stock to recover at least to cover the gap at around $99.60, if the level does not hold, I do not know how low it will go, maybe back to around $95, possibly lower, who knows. The drop today was related to comments by the cfo on a challenging quarter coming up, I expect winter time is always a bit challenging for the railroads, will see how that affects the price in the coming weeks.

  10. bruce Says:

    tu Sherri
    much appreciated….

  11. Sandra Says:

    One that should have been shorted today!

    http://stockcharts.com/h-sc/ui?s=FNG&p=D&yr=1&mn=2&dy=0&id=p97932084706&a=558577472

  12. Sandra Says:

    # 11 contd.

    FNG ETF holdings:
    Top 10
    AMZN Amazon.com Inc 10.91%
    GOOG Alphabet Inc 7.59%
    Tencent Holdings Ltd 7.23%
    Facebook Inc 7.11%
    NVDA NVIDIA Corp 6.76%
    Microsoft Corp 6.11%
    Alibaba Group Holding Ltd 5.80%
    Netflix Inc 4.54%
    Apple Inc 4.45%
    Salesforce.com Inc 4.22%

  13. Paula Says:

    Mick/NV,
    You are right. No one knows how low it can go. Will try to be patient…

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