Tech Talk for Friday July 6th 2018

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Pre-opening Comments for Friday July 6th

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

Index futures moved higher following release of economic news at 8:30 AM EDT. Consensus for June Non-farm Payrolls was 195,000 versus an upwardly revised 244,000 in May. Actual was 213,000. Consensus for the June U.S. Unemployment Rate was unchanged from May at 3.8%. Actual was an increase to 4.0%. Consensus for June Hourly Earnings was an increase of 0.3% versus a gain of 0.3% in May. Actual was an increase of 0.2%. Consensus for the May U.S. Trade Deficit was $47.0 billion versus $46.2 billion in April. Actual was $43.1 billion.

The Canadian Dollar added 0.08 to U.S. 76.25 cents following release of economic news at 8:30 AM EDT. Consensus for the May Merchandise Trade Deficit was $3.6 billion versus $1.9 billion in April. Actual was $2.77 billion. Consensus for June Employment was a gain of 20,000 versus a decline of 7,500 in May. Actual was a gain of 31,800. Consensus for the June Unemployment Rate was unchanged from May at 5.8%. Actual was an increase to 6.0%.

Biogen gained $39.19 to $338.00 after releasing positive results from a study of its Alzheimer treatment.

Parker Hannifin (PH $157.08) is expected to open lower after KeyBanc Capital lowered its target price to $200 from $225.

 

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2018/07/05/stock-market-outlook-for-july-6-2018/

Note seasonality charts on Non-Farm Payrolls, U.S.REIT Index, Crude Oil Days of Supply and Gasoline Days of Supply.

 

Observations

U.S. inflation concerns are escalating.

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Markets are responding to trade war fears (in both directions). China is expected to announce countervailing traffics today.

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StockTwits Released Yesterday

Agnico-Eagle $AEM, a TSX 60 stock moved above $46.63 U.S. extending an intermediate uptrend.

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Technical action by S&P 500 stocks to 10:00: Nil $SPX

Editor’s Note: After 10:00 AM EDT, breakouts included CTL, K, MMC, JNJ, PX and KO. Breakdowns included NWS, FTI and IPG.

Johnson & Johnson $JNJ, a Dow Jones Industrial stock moved above $124.85 completing a base building pattern

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Editor’s Note: Coca Cola $KO, another Dow Jones Industrial stock moved above $44.63 near the close extending an intermediate uptrend.

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U.S. Dollar Index and related ETF $UUP are showing short term technical weakness: Breaks below its 20 day moving average and daily Stochastics/ RSI/MACD turning down.

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‘Tis the season for weakness in the U.S. Dollar Index between now and mid-October! $UUP

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for July 5th 2018

spx for july 6

Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for July 5th 2018

crb for july 6

Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Sector Trends for July 5th 2018

xlk for july 6

Green: Increase from previous day

Red: Decrease from previous day

 

S&P 500 Momentum Barometer

The Barometer added 5.00 to 57.00 yesterday. It remains intermediate neutral.

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TSX Momentum Barometer

The Barometer slipped 1.65 to 64.46 yesterday. It remains intermediate overbought.

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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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7 Responses to “Tech Talk for Friday July 6th 2018”

  1. KC Says:

    Ron/BC,

    Was looking at your Teck/B.to chart in detail earlier today. I’m a bit confused about your think green verticals for RSI. I understand the greens are buy signals, however, I’m confused about why you have them on 18 Oct 16, 13 Jan17, 20nov17 as an example. Those seems to be either overbought or heading up to overbought. ORrrrrrrr did you use the thicker green lines to signal MacD crossover to above zero ? Still, those would be a risky buy for a buy signal. Appreciate it , if you could please clarify, unless of course you are our golfing!

    Cheers,
    KC

  2. Ron/BC Says:

    KC
    Here is the chart redone with just the RSI 8 buy signals. I did have the heavier vertical lines marked with the Modified MACD signals. The Modified MACD signals with both the 20,50,1 & a 10ema and a 50,200,1 and a 20ema are good for tracking the trend and are not that timely. But when you do see a change in trend direction you can usually take that directional position and not exit until it changes with a cross over. And again they aren’t as timely as something like a momentum indicator but will keep you in a stock in the right direction for most of the move. Also on this 2nd longer term chart note the recent test of the $31.50 area is also the uptrendline from early 2016 which makes that price point test all the more significant. Also note the very long Modified MACD 50,200,1 with the 20ema and how when in an overall bullish uptrend it is above the zero line and when bearish overall it is below the zero line. This is also a very good indicator for longer term investors. Plus note on the first chart as it is shorter so clearer, see the Histogram and after it has crossed below the zero line and then stops going down and has a higher low that tends to see it reverse back up again and also signals a price low with price going back up as the downside momentum has reversed. Not perfect but worth paying attention to it. The reason those Modified MACDs are valuable is many major brokerages and financial institutions and stock letter writers use the 20 and 50 and 200 moving averages for the base of their work. So it pays to study their movements.

    http://stockcharts.com/h-sc/ui?s=TECK%2FB.TO&p=D&yr=1&mn=6&dy=0&id=p68722780601&a=579408433

    http://stockcharts.com/h-sc/ui?s=TECK%2FB.TO&p=D&yr=10&mn=0&dy=0&id=p54627384047&a=579408557

  3. Kam Says:

    “Kam Says:
    July 5th, 2018 at 2:03 pm
    Gartman is short spx and his stop is 2741-2749. Lets stop him out folks.Or he be right this time if we tank. Fed minutes next.”

    You guys were warned/ hinted yesterday to follow the ultimate contrarian indicator:) Hope someone did. SPX closed today @ 2759.
    http://tiny.cc/9y2bvy

    SPX survived for now from a big break down. Should not pull back below 2743- 2736 to keep rising high or trouble again. I am long es and small caps.

  4. Kam Says:

    Ron/BC,

    If time can you please do some chart work on SPX and IWM? Tia

  5. Ron/BC Says:

    Kam
    Here is a daily chart of $SPX. Nothing much wrong with the price chart. Price continues to bounce off its 2.5 year uptrendline as well as its 200ema. And price continues to have higher highs and higher lows since the April lows. The RSI 8 just gave a short term buy signal with price needing to clear the last high of 2791 and 2801. That would suggest a run to a double top of 2872. The 50ema is also above the 200ema meaning the trend is overall bullish and has been since April 2016. So not too much wrong with the price chart or momentum or trend. Perhaps Mr. Wiseguy knows something we don’t. With the trade war cranking up with questionable consequences who knows what can happen next. But as it stands now the chart looks good to me.

    http://stockcharts.com/h-sc/ui?s=%24SPX&p=D&yr=2&mn=6&dy=0&id=p97818976729&a=579408638

    http://stockcharts.com/h-sc/ui?s=%24SPX&p=D&yr=0&mn=8&dy=0&id=p77580168693&a=582707024

  6. Ron/BC Says:

    Kam
    Much the same bullish theme with IWM. IWO has been outperforming IWM since early 2017 though.

    http://stockcharts.com/h-sc/ui?s=IWM&p=D&yr=2&mn=6&dy=0&id=p14087672081&a=579408528

  7. Ron/BC Says:

    KC
    Even with the TECK/B.to chart suggesting a bounce for a variety of reasons, my concern is the $COPPER and TECK chart along with the Base Metals chart ETF:DBB which have all plunged over the last few weeks. Could be due to the present escalating trade war heating up and high tariffs ahead world wide. I don’t know but this chart is a concern for sure when considering a metals stock like TECK and others in the same group. “Caveat Emptor.” Play the bounce if you like but have your finger on the sell button at all times too………

    http://stockcharts.com/h-sc/ui?s=DBB&p=D&yr=3&mn=0&dy=0&id=p68627028139&a=579408567

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