Tech Talk for Thursday February 1st 2018

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Pre-opening Comments for Thursday February 1st

U.S. equity index futures were lower this morning. S&P 500 futures were down 4 points in pre-opening trade.

Index futures were virtually unchanged following release of the Weekly Jobless Claims report. Consensus was an increase to 235,000 from 231,000 last week. Actual was 230,000.

Fourth quarter reports continue to pour in. Companies that reported since yesterday’s close included Alibaba, Altria, AT&T, Boston Scientific, Citrix Systems, ConocoPhillips, DowDupont, Eaton, EBay, Facebook, Hershey, Marsh & McLennan, MasterCard, McKesson, Microsoft, Mondelez, Parker Hannifin, PayPal, Qualcomm, Ralph Lauren, Symantec, Time Warner and UPS.

EBay gained $4.23 to $44.81 after several investment dealers raised the target price on the stock. The company announced higher than consensus fourth quarter results. In addition, RBC upgraded the stock to Outperform from Sector Perform.

Microsoft (MSFT $94.25) is expected to open higher several investment dealers increased the target price on the stock. The company announced higher than consensus quarterly results.

EquityClock’s Daily Market Comment

http://www.equityclock.com/2018/01/31/stock-market-outlook-for-february-1-2018/

Note seasonality charts on the Energy sector, Materials sector, Canadian GDP, Canadian Dollar, Crude Oil Days of Supply, Gasoline Days of Supply and WTI Crude Oil.

Observations

Response by the end of the trading day to the FOMC decision at 2:00 PM to maintain the Fed Fund rate was muted in equity markets. Gold and Treasury Bond prices moved slightly higher.

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StockTwits Released Yesterday @EquityClock

Technical action by S&P 500 stocks to 10:00: Bearish. No breakouts. Breakdowns: $IVZ $UNM $JNPR $SEE.

Editor’s Note: After 10:00 AM EST, breakouts included CCI and SBAC. Breakdowns included AYI, GLW, PDCO, JNJ, AMP, COG and MCD.

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Celestica $CLS.CA moved below $12.62 extending an intermediate downtrend.

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Fairfax Financial $FFH.CA moved below $640.00 extending an intermediate downtrend.

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Power Financial $PWF.CA moved below $34.00 extending an intermediate downtrend.

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Canadian Natural Resources $CNQ.CA, a TSX 60 stock moved below$42.12 completing a double top pattern.

Editor’s Note: BC government attempt to slow down/block the TransMountain Pipeline expansion impacted all of the oil sand producers.

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Canada GDP up 0.5% (NSA) in November, firmly better than the 0.3% average decline for month. #CDNecon #CAD $MACRO

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S&P 500 Index has averaged a gain of 0.2% in February; positive in 56% of periods. http://www.equityclock.com/2018/01/31/stock-market-outlook-for-february-1-2018/ $SPX $SPY $ES_F $STUDY

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Days of supply of #Oil shows largest one week increase since the start of September as inventory injection season gets underway. $USO $CL_F

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for January 31st 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for January 31st 2018

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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 January 31st 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

S&P Momentum Barometer

The Barometer dropped another 1.20 to 75.20 yesterday. It remains intermediate overbought and trending down.

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TSX Momentum Barometer

The Barometer dropped another 1.65 to 38.27 yesterday. It remains intermediate neutral 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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18 Responses to “Tech Talk for Thursday February 1st 2018”

  1. bruce Says:

    sherri

    thanks for the Armstrong last night…

  2. Larry/ON Says:

    Market Volatility – There is concern that there may be a correction in the 4-6% range to close to the 50 day MA on the SP500 to perhaps around 2730. Things seem to be quite orderly right now. It’s a bit of a guessing game but there is a high probability that the 20 day MA ends up holding up as solid support as sideline money steps in. The 20 and 50 day were even around Sep 1st and on the rise since then the 20 day has been solid support. Any decline to the 50 day would only be about 3.5% more and would be quite healthy for the market. It is all short-term noise in this market.

  3. Tawny Says:

    Sherri,

    Caught your post from Armstrong Private Blog yesterday – thank you for these. But seems there were two on the private… the second one was Dow and the Possible Consolidation. Did you get that one and post too. I might have missed it. Sorry to be in the closet but my life is complex at the moment.

  4. dutchcanuck Says:

    Tawny #3
    Good to hear from you. Was wondering how you were, since we had not heard from you for a while.
    Hast La Vista!

  5. Paula Says:

    Larry/ON,was that you asking about TXN on BBNN yesterday?

  6. Tawny Says:

    Dutchcanuck

    #4, thank you… my life has been odd this past couple of years… and particularly lately.
    I am sitll around and peeking in occasionally on this site.

  7. Paula Says:

    Tawny,I think of you and am grateful every time I listen to Chris Ciovacco’s weekly video. I recently asked if anyone else listens but did not get a single response. It puzzles me why everyone wants to hear what Armstrong is saying. I don’t get it.

  8. Tawny Says:

    Paula, #7 –
    I follow both… I follow Ciovacco’s tweets on an almost daily basis. I believe his tweets are #1 rated for financials on twitter.
    Both of these are my “go to” and try to shut much else out.. I am mostly in US based investments.

    I do read Tech Talk occasionally for Canadian sectors. In Canada I was fortunate enough to get into cannabis stocks early and in spite of pullback today am reaping handsome profits.

  9. Paula Says:

    Tawny, #8-
    thanks for the reply. I agree on trying to shut out the noise. Congratulations on getting into cannabis stocks early. You are braver than me. My riskier money is on the U.S. biotechs – XBI. But I still have the tendency to take profits too soon. I don’t like to give back profits and it goes against my nature to jump on momentum plays on “break outs”. I am always expecting a reversion to the mean. I feel that Ciovacco as well as Arthur Hill help me stay with the trend, but it is still difficult.

    I honestly don’t understand what Armstrong is saying and how/why people find him of any use.

  10. Ron/BC Says:

    Utility stocks continue to get hammered with interest rates continuing to rise and the broad market selling off. FTS.to has pulled back to important price support at the $42.50 area. Notice how well the RSI 8 and other oscillators are good at signalling price lows within uptrends but give the same signals in downtrends as well catching traders with dead cat bounces within downtrends. The lower indicators are better for the trend direction and presently don’t show anything positive. But support is support and this price point is important support that needs to hold. We’ll see if buyers step in here. Similar chart with CNR.to testing $97 that also needs to hold to suggest a return to the uptrend. And EMA.to as well testing important price support. We’ll find out soon enough just how bullish or bearish traders/investors are here.

    http://stockcharts.com/h-sc/ui?s=FTS.TO&p=D&yr=2&mn=0&dy=0&id=p45318310733&a=505251651

    http://stockcharts.com/h-sc/ui?s=EMA.TO&p=D&yr=1&mn=0&dy=0&id=p73644447192&a=526551696

    Also BMO.to broke out above $101.33 and ran up another $3 bucks and has pulled back to the breakout point which ‘should’ serve as price support now. “IF” this market is healthy it will turn around here and run up again. Price broke below and closed a little below this important price point but did have a strong close with a long tailed bar. The next day or so will tell the tale. But with interest rates rising it isn’t a good sign to see the banks selloff.

    http://stockcharts.com/h-sc/ui?s=BMO.TO&p=D&yr=1&mn=0&dy=0&id=p79960153626&a=568088253

  11. Larry/ON Says:

    Paula – Yeah that was me asking about TXN. I hold some tech which I am always wondering about with valuation. I may have been too complacent with TXN.

  12. dutchcanuck Says:

    Sold 40% of my holdings in Shopify and Facebook today.Both made new highs.
    Sold 40% of my Savaria (SIS.TO) last week. Think it’s time to raise some cash.

  13. Larry/ON Says:

    Cannabis stocks – What a drop it has been for the past three weeks. I notice WEED is right at the 50 day and at the same time OSTK which is into blockchain is also at the 50 after a similar sell-off. I won’t touch any of these and they are either going to rebound at this point or the bottom is going to really fall out. I think WEED could drop down to $20 which would be almost a further 25% drop.

  14. Paula Says:

    Larry/ON,#11,
    Thought so! Yes, valuation is always an issue with tech stocks. Sometimes the market does not care and it is all about growth, then all of a sudden it turns out that it does matter after all.

  15. dutchcanuck Says:

    Just ran the the chart on the 10 yr treasury bond yield(US). It’s gone parabolic after breaking out from a H&S bottom with a neckline at circa 2.50 and a close of 2.773. If the bond yield crosses 3% then the bond proxies will start to drop even more than they have already. Hang onto those telecom, pipeline and other proxies if you must, but I suggest do not move more money into these vehicles now.
    Remember Ron/BC’s comment of “cash is also a position”.

  16. Ron/BC Says:

    dutchcanuck
    Yes it seems too many people on one side of the boat once again. I recall Joe Granville who I used to subscribe to decades ago. He was really off the wall and outrageous but he was also never typical and was very good at being a contrarian. One expression he often used was “If it’s obvious,it’s obviously wrong.” I did learn a lot from his unique way of looking at the market and always noticed when everyone was singing the same tune not to sing along with them. That applies to most everything in life I’ve found. I’m sure you’d remember Joe Granville.

    http://stockcharts.com/h-sc/ui?s=%24TNX&p=D&yr=12&mn=0&dy=0&id=p52246777970&a=470999534

    http://stockcharts.com/h-sc/ui?s=%24TNX&p=D&st=1980-01-01&id=p70211735642&a=330195423

  17. dutchcanuck Says:

    Ron/BC #16
    How could anyone forget Joseph Ensign Granville. Like many so-called market gurus he made one right call and that was the market top in 1981. Alas, when the market turned and went on a bull run in 1982 Joe kept calling for a more and more severe down market. He developed the concept of the on balance indicator (OBV). When asked how he developed the concept he said and I quote :
    “It came to me while sitting in a La Guardia washroom stall and I was staring at the tiles”. He was quite a showman and if he was still around today he would be vilified for his politically incorrect remarks.

  18. Sherri Says:

    #3 Tawny

    Post #21 yesterday was it. No worries.

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