Tech Talk for Wednesday June 20th 2018

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Pre-opening Comments for Wednesday June 20th

U.S. equity index futures were higher this morning. S&P 500 futures were up 6 points in pre-opening trade.

Walgreen gained $2.06 to $66.67 and General Electric fell $0.13 to $12.82 after Walgreen replaced General Electric in the Dow Jones Industrial Average

Starbucks dropped $2.15 to $55.28 after lowering guidance. Stifel Nicolaus lowered its target price to $55 from $58.

FedEx (FDX $257.50) is expected to open higher after reporting higher than consensus quarterly results. The company also raised guidance. Morgan Stanley raised its target price to $305 from $300.

Oracle dropped $1.92 to $44.35 after lowering its fiscal first quarter guidance. Stifel Nicolaus lowered its target price to $50 from $53.

Winnebago jumped $4.50 to $44.85 after reporting higher than consensus fiscal third quarter results.

Disney added $2.20 to $108.30 and Fox gained $3.05 to $47.34 after Disney raised its bid for Fox assets to $71.3 billion in cash and stock.

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2018/06/19/stock-market-outlook-for-june-20-2018/

Note seasonality charts on the Biotech sector and U.S. Housing Starts.

Observations

Trade war concerns are impacted equity markets and their related ETFs around the world

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StockTwits released yesterday@EquityClock

American Express $AXP, a Dow Jones Industrial stock moved below $96.98 completing a double top pattern.

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Technical action by S&P 500 stocks to 10:00: Bearish. Breakout: $DRI. Breakdowns: $AXP $SCHW $ROK $AMAT $XRX $AVY $FMC

Editor’s Note: After 10:00 AM EDT, breakout included AIG and breakdowns included BWA, MS, CMI, EMR, HON, ITW, PWR, AAPL, PKG, RTN, GD and MGM.

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Base metals ETN $DBB moved below $18.41 setting intermediate downtrend.

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Base metal stocks and ETFs by $DBB followed by breakdowns by $TECK $COPX $BHP $RIO $TECK.B.CA

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EAFE iShares $EFA moved below $67.20 setting an intermediate downtrend

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China iShares $FXI moved below $45.46 and $44.60 setting an intermediate downtrend.

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Lumber stock ETF $WOOD moved below $78.71 completing a double top pattern.

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Lithium ETN moved below $32.92 setting an intermediate downtrend.

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Vietnam ETF $VNM moved below $16.00 extending an intermediate downtrend.

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Apple $AAPL, a Dow Jones Industrial stock moved below $185.10 setting a double top pattern.

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for June 19th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for June 19th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Sector Trends for June 19th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

S&P 500 Momentum Barometer

The Barometer dropped to . It remains intermediate overbought and has rolled over

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TSX Momentum Barometer

The Barometer dropped to. It remains intermediate overbought and has rolled over.

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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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14 Responses to “Tech Talk for Wednesday June 20th 2018”

  1. Larry/ON Says:

    Market Uptrend Solidly Intact – SP500 revisited mid-bollinger band yesterday and the push continues to be up in the face of all negative trade news. This is evidence of a very strong bull market that will continue to surprise everyone to the upside. Tech stocks are leading the way.

  2. john/on Says:

    have a look at biotec, holding up & seasonally strong

  3. Mary Says:

    Larry/ON

    Thanks for the market update. Any thoughts on steel stocks?

  4. Larry/ON Says:

    Re 3. Mary there is a lot to follow and that is not an area that I invest in. In a bull market you have to invest in what is working and don’t try to invest in an area that is not working with the idea that you are buying cheap. If I look at X (US Steel) and XLI (US Industrials) they are lagging the market. Small-cap is working and tech is working. Energy is working. New highs will beget further highs in a bull market. What’s on fire right now that I invest in: NFLX, SHOP, AMZN, GOOGL. MSFT also doing well. Other people can point out other stocks that are doing well. I invest in what works.

  5. Larry/ON Says:

    Re 3 – There is also a semi-conductor stock that I am holding for the long-term.

  6. Mary Says:

    Larry/ON
    Larry thanks. Re #4 true statement. “Invest in what is working at the moment”.

  7. rick Says:

    Larry/ON ,

    I would add MA, V, ADBE = impressive charts

    FB is at new high too , ISRG

    tech in general = QQQ and XLK for ETFs

  8. rick Says:

    Those companies are making good profits

  9. rick Says:

    TSX = new high !
    Looks like the Canadian economy is booming !

    Is it true ?

    NO!

    Look at $SPX chart and compare it with VFV.TO
    SPX high in January and VFV.TO high today .
    Why ?
    Because $SPX is in USD and VFV.TO is the same $SPX but in CAD

    The only reason why TSX is going UP = because CAD is going DOWN

    Look at $MERV = Argentina index on a 5 years chart
    From 3000 to 30.000 = 10 times ! in 5 years = super investment !
    Actually 848 % 9,48 times = 848 %

    Not so fast = how about argentinan peso ?

    In 2013 you need 5,35 pesos to buy 1 USD
    Today you need 27,75 pesos to buy 1 USD
    27,75 divided buy 5,35 = 5,2

    so that 848 % times in argentinian pesos = 848 % = 9,48 : 5,2 = 1,82 so 82 %
    So that 848 % is more a result of a huge devaluation in Argentinian peso

    Is it good or bad ?
    SPX in 5 years = 74 %
    MID = 75 %
    RUT = 77 %
    NDX = 151 %
    QQQ = 164 %
    How about TSX ? TSX = 37 % , ONLY 37 % in 5 years ? worst than Argentina ?

    How about Canadian $ = $CDW ?

    In 5 years CAD comparative with USD = – ( minus ) 22 %
    Canadian $ dropped 22 % in value in 5 years
    and Argentinian pesos dropped 5,2 times = 420 %

    What does it mean ?

    An investor has 2000 US $ in 2013
    He decide to invest 1000 at $TSX in Toronto – Canada
    and 1000 $ at $MERV in Buenos Aires – Argentina
    with 1000 US $ he will buy 1052 Cad 1000 x 1/0.95= 1052
    5 years ago with 1 CAD you will get 0,95 USD , today the same 1 CAD will get you 0,75 USD
    with 1000 US $ he will buy 5350 ARG pesos 1000 x 5,35 = 5350
    5 years ago 1 USD = 5,35 Pesos today 1 USD = 27,75 pesos
    1052 CAD in 5 years at $TSX = 1052 x 1,37 = 1441 CAD
    5350 ARG Pesos in 5 years at $MERV = 5350 x 9,48 = 50718 Pesos
    Now lets translate back in USD
    1441 CAD x 0.75 = 1080 USD for a ” huge ” return of 8 %
    50718 pesos : 27,75 = 1827 USD for a return of 82 % = 10 times more than in Canada !!!!
    Or if that investor = invest in SPX in US $ = he will get 74 %

    So that 37 % in $TSX in Canadian $ is actually only 8 % in US $ !!! in 5 years !
    Total disaster !
    But wait ! is it Argentina that bankrupt country that received 50 Billions US $ this week from IMF because they cannot paid back their loans ?

  10. rick Says:

    Politicians can and will lie ( that Canadian economy is booming )
    But numbers are not lying .
    37 % in $TSX in 5 years and in the same time Canadian $ dropped 22 % in value is a total disaster for a foreign investor in Canadian economy .
    This is why :
    1. Foreign capital does not come in Canada
    and
    2. Canadian capital is leaving Canada

  11. rick Says:

    Is what I wrote a secret ?
    No !
    Everybody in financial world in Toronto knows about it ,but they don’t want to talk about it .
    This is why :
    To help Canadian Investors Vanguard developed an ETF = SPX hedged for CA $
    VFV.TO
    Check the results for last 5 years = 143 % !!!
    Why so much ?
    it gets SPX 72 % return and that 22 % devaluation in CA $ too .
    So be honest with your money : did you make 143 % in last 5 years ?

    If the answer is yes = congratulations , you are above average !
    If the answer is no ….Is not easier just to buy an index in a strong currency and forget about trading ?

  12. Bernie Says:

    rick,

    TSX may have only returned 37% in 6 years but why buy it anyway, its a terrible index. Mawer Canadian Equity returned 72.2% over 5 years, should have bought it earlier. I have it in my RRIF. My portfolio only returned 61.6%. I own HXQ.TO in my TFSA. Purchased a little over a month ago.

  13. rick Says:

    Bernie ,
    72,2 % is only half of 143 %.

    Please check Mawer US Equity fund . I don’t know their number. maybe is better ? it should !

    HXQ.to is a great investment but a little bit more volatile ( you need a stronger stomach or a little bit more beer )
    No tax on American dividends inside TFSA or non registered account because is a Total Return index etf (tax efficiency ) = 15 % tax on dividends payable to US government that you can recover in non registered account but not inside TFSA
    A good alternative to energy which is even more volatile .
    From their prospect : benefits =
    not expected to make taxable distributions and would not be subject to U.S. withholding tax or estate tax
    • Potentially higher after-tax returns. Dividends are automatically reflected in the value of ETF
    • Increased portfolio diversification. Direct exposure to this Index can complement domestic exposure to Canadian equities, which is heavily weighted towards financials and energy.

    Because you like dividend growing investment :
    in top 5 components you will find AAPL, MSFT

    AAPL dividends : five year ago 3,05 $ per share = after 7:1 split = 43 cents per share
    today 73 cents per share in dividend
    73:43= 1,6977 = almost 70 % growth in dividend in 5 years , and those dividends will do directly in the value of HXQ.to because is a total return index etf

    MSFT dividends = from 23 cents to 42 cents per share = 42:23= 1,826 = 82 % growth in dividends in 5 years
    another big one INTC = from 22,5 to 30 =30:22,5 = 1,33 = 33 % growth in dividends in 5 years
    CSCO = from 17 to 33 = 33:17 = 1,94 = 94 % growth in dividends in 5 years

    So with HXQ.to you will have growth in price and growth in dividends too !
    Are those dividend growth percentages good for you ?

    Just put some more beer in fridge .
    Look what happens in Russia at world soccer championship = they expect more drinking in vodka not beer and now they have a beer crisis and its only the first week , 3 more weeks to go without enough beer ?
    well, germany lost with mexico = german suporters have to make some damages to the russian beer reserves right ?

  14. Bernie Says:

    Rick,

    I know 72.2% is half of 143%, it is also double 37%. I don’t only hold Mawer Canadian Equity, I also own Mawer Global Equity and Mawer Global Small Cap. These returned 107.1% and 139.9% over 5 years. I did own Mawer U.S. Equity which returned 127.2% but sold it to buy ZWA.TO and ZWH.TO for better income. At this stage of my investment life I seek more diversity and safety over total return in my RRIF.

    My TFSA is another story. That’s where I hold HXQ.TO, along with a few other securities, for growth. HXQ.TO is a swap based total return ETF so it pays no dividends…perfect for a TFSA account, no dividends = no withholding taxes. I know the Nasdaq is volatile so I have an exit strategy. My ZWA.TO also has AAPL and MSFT content in it, maybe Mawer Global Equity too but I don’t know for sure.

    You’re probably right about the World soccer. Sorry, I don’t follow it. I prefer the (Canadian) football with two points at either end. 🙂

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