Tech Talk for Thursday July 19th 2018

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Pre-opening Comments for Thursday July 19th

U.S. equity index futures were lower this morning. S&P 500 futures were down 9 points in pre-opening trade.

Index futures were virtually unchanged following release of economic news at 8:30 AM EDT. Consensus for Weekly Jobless Claims was an increase to 222,000 from 215,000 last week. Actual was 207,000. Consensus for the July Philly Fed Index was an increase to 22.0 from 19.9 in June. Actual was an increase to 25.7.

Travelers dropped $5.00 to$125.00 after reporting lower than consensus second quarter earnings.

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IBM added $2.98 to $147.50 after reporting higher than consensus second quarter sales and earnings.

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American Express dropped $2.03 to $99.95 after lowering its third quarter guidance.

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eBay dropped $3.15 to $34.80 after lowering its third quarter guidance. Seven U.S. brokers lowered their target price on the stock.

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Philip Morris fell $3.97 to $78.18 after lowering its third quarter guidance.

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EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2018/07/18/stock-market-outlook-for-july-19-2018/

Note seasonality charts on U.S. Housing Starts, Crude Oil Days of Supply, Gasoline Days of Supply and Crude Oil.

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Changes in seasonality ratings for equity markets at this time of year

Most equity markets in the world (exceptions: Brazil and India) have a history of turning negative after July 18th when second quarter earnings report season approaches its peak. Their weakness often is related to increasing volatility into mid-October. What about this year? Most equity markets currently are intermediate overbought and are vulnerable to an “outside event” (e.g. failure to negotiate trade tariffs). Watch the VIX Index as a leading indicator. The following seasonality charts show history of the VIX Index and major equity markets (and their related ETFs) during the past 20 years.

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StockTwits Released Yesterday @EquityClock

Barrick Gold $ABX.CA $ABX, a TSX 60 stock moved below $16.58 setting an intermediate downtrend.

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Technical action by S&P 500 stocks to 10:00: Bullish. Intermediate breakouts: $ABT $CSX $GWW $UAL $PPG. Breakdown: $HP

Editor’s Note: After 10:00 AM EDT, breakouts included ORLY, NTRS, ICE, AXP and JEC. Breakdowns: TSN, CVX $TXT

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Chevron $CVX, a Dow Jones Industrial stock moved below $120.06 completing a double top pattern.

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Norbord $OSB.CA moved below $52.15 completing a double top pattern.

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US Production of #Oil jumps to another record at 11 million barrels per day, up 12.5% year-to-date. $USO $CL_F $XLE

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US #Housing Starts fall 9.9% (NSA) in June, a significant divergence compared to 2.3% increase that is average for month. $MACRO #Economy

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American Express $AXP, a Dow Jones Industrial stock moved above $102.87 to an all-time high extending an intermediate uptrend.

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for July 18th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for July 18th 2018

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Green: Increase from previous day

Red: Decrease from previous day

Daily Seasonal/Technical Sector Trends for July 18th 2018

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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 added 3.20 to 67.40 yesterday. It remains intermediate overbought.

 

TSX Momentum Barometer

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The Barometer slipped 0.83 to 63.33 yesterday. It remains intermediate overbought and showing early signs of rolling over.

 

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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16 Responses to “Tech Talk for Thursday July 19th 2018”

  1. Larry/ON Says:

    SP500 at RSI 65.2 and QQQ at RSI 64.91. In percentage terms the SP500 is less extended from the 200 day MA than it was for all of 2017. There are more short SP500 contracts now than since 2015. The average hedge fund has reduced their long exposure by 50% since January. The market has advanced this past month with good earnings reports while there has been the worst backdrop of geopolitical news I can remember in years. Entering what is now the seasonally worst period of the year until October it will be an interesting test of this market. There certainly is plenty of money that can come in on any decline. I am not at all worried.

  2. KC Says:

    Hello Bernie,

    I suspect you invest mostly for dividends. Can you please, clarify once again how things work with the record date and payment date of dividends ? If one were to sell the stock, a day or two past the record date, does one still get paid the dividend on the payment date ? OR does one actually have to hold the stock till the payment date ?

    Thanks,
    KC

  3. Bernie Says:

    KC,

    Re: #2
    You need only concern yourself with the ex-div date. You will receive the dividend on the pay date if you purchased the stock prior to the ex-div date. You can even sell the stock on the ex-div date and receive the dividend, its only imperative that you hold it at the opening.

  4. dutchcanuck Says:

    The Canadian yield curve now prints 18.6 basis points. That is the spread between 10yr and 2yr bonds. This is for the believers only(lol)

  5. Ron/BC Says:

    The U.S.$ is having difficulty clearing ‘and holding’ above 95 resistance. Might see a reversal here if price cant clear 95. Much like a car spinning its wheels at the top of an icy hill. Also note the negative divergences on the RSI 8 at this 95 resistance level. Big test here for the U.S.$.

    http://stockcharts.com/h-sc/ui?s=%24USD&p=D&yr=2&mn=6&dy=0&id=p08948129890&a=579408533

  6. KC Says:

    Hi Ron/bc,

    Thanks for #5. Any idea how much of a dip you’re possibly seeing to next support ? Yes, your “opinion” only lol.

    Cheers,
    KC

  7. KC Says:

    Bernie,

    I assume “record date” and “ex-date” mean the same thing ?

    Thanks,
    -KC

  8. KC Says:

    Bernie,

    I’m curious about what you hold for dividend play. Can you share maybe your top 6 or favourite 6 and why you hold them ?

    Thanks,
    KC

  9. KC Says:

    Ron/BC,

    Not sure if you’ve ever commented with your TA on Visa V-N ? Wondering what yours thoughts are and why one should not buy and hold this. Hard to pick figure out RSI entry and exit points with this I find.

    Thanks,
    KC

  10. Mary Says:

    Larry/O
    I heard the same comment last night on business channel. If there is a short squeeze lots of money will be lost. I do have a two US stocks but one day up next day down. Waiting for earnings to see what happens. Thanks for the update.

  11. Bernie Says:

    KC,

    Re: #7
    The “record” date and “ex-div” are not the same date. Dividends are paid on the “pay” date to those who hold the stock on the date of record or “record” date. As I was saying earlier if you hold the stock on the opening of the “ex-div” date you automatically are on record as holding the stock on the “record” date. This can all be confusing that’s why I suggest only concerning yourself with the “ex-div” date per my comment #3. Below are two sites which show the various dates per BCE.TO. I consider the latter site more pertinent because it only shows the two more important dates.
    http://ca.dividendinvestor.com/historical.php?no=4469
    https://www.dividendhistory.org/payout/TSX/BCE/

  12. Bernie Says:

    KC,

    You might be interested in the article I’ve linked below. It explains the dividend capture strategy. I don’t personally care for the strategy but it might work for you.
    https://www.investopedia.com/articles/stocks/11/dividend-capture-strategy.asp

  13. Bernie Says:

    KC,

    I’ve done some dividend plays over the years but much preferred buy and hold with dividend growth stocks. I practiced “dividend growth investing” (DGI) from 2007 to late 2017 in my non-registered account and from mid 2008 to Feb 2018 in my RRSP, now RRIF. I now hold only one dividend stock that being EIF.TO in my non-registered account. My other holdings consist of mutual funds and ETFs. At this stage of my life I basically wanted to simplify my holdings and diversify globally.

    If I were to go back to DGI I would have the following 11 stocks and one ETF in my Canadian core holdings. They offer a great combo of dividend and dividend growth.
    NFI, BIP.UN, T, TD, BNS, TRP, RY, ENB, FTS, CAR.UN, ECI and XDIV.

  14. Ron/BC Says:

    KC
    The U.S.$ once again poked its nose over 95 but could not close above it and hold. The technicals overall are very bullish for it but short term resistance is just that and price could pullback to the previous strong resistance area of 92 that is now support. Or price could pullback less than that and go sideways and consolidate or my preference would be to blow threw 95 to 102 as the chart pattern suggests on a breakout. But the market doesn’t care what I think unfortunately so we’ll see.

    As far as Visa goes it doesn’t want anyone to get onboard. Reminds me of a rocket’s smoke pattern in the sky. I wont be chasing it.

    http://stockcharts.com/h-sc/ui?s=%24USD&p=D&yr=2&mn=0&dy=0&id=p64502456618&a=579408293

    http://stockcharts.com/h-sc/ui?s=V&p=D&yr=9&mn=0&dy=0&id=p19309427005&a=579408587

  15. KC Says:

    Bernie,

    Really appreciate your comments and tips. Will start watching and researching some of those.

    Thanks,
    KC

  16. Bernie Says:

    KC,

    Re: #15 from last night
    You’re welcome. If you aren’t aware of them already I highly suggest becoming familiar with the Canadian Dividend All Star List (Cdn) and CCC List (U.S.). IMO those are the best sources for fundamental info on dividend growth stocks. I don’t know where I’d be without them. Much poorer I suspect.

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