Tech Talk for Wednesday September 19th 2018

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Pre-opening Comments for Wednesday September 19th

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

E-Trade (ETFC $53.76) is expected to open higher after Jefferies raised its rating on the stock to Buy from Hold.

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Humana (HUM $335.99) is expected to open higher after Sun Trust increased its target price to $380 to $350.

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Autozone (AZO $732.26) is expected to open higher after JP Morgan increased its target price to $880 from $800.

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Netflix gained $4.65 to $372.30 after Guggenheim increased its target to $420 from $360.

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EquityClock’s Daily Comment

Following is a link:
http://www.equityclock.com/2018/09/18/stock-market-outlook-for-september-19-2018/

Note seasonality charts on the Nikkei Average, Shanghai Composite, Manufactured Goods Sales and Manufactured Inventories.

 

Observations

Strength in U.S. equity indices yesterday was triggered by strength in Chinese indices and related ETFs in anticipation of start of trade negotiations.

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Strength in Chinese indices triggered significant gains in base metal and steel stocks (XLE).

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Nice breakout by the Agriculture Products ETF above $65.18! ‘Tis the season for strength to the end of the year!

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Natural gas prices soared on realization that inventory levels are near a 20 year low and demand remains higher than average for this time of year due to higher than average temperatures in eastern North America. ‘Tis the season for strength to late December! “Gassy” stocks and related ETFs also responded.

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StockTwits Released Yesterday @EquityClock

Technical action by S&P 500 stocks to 10:15: Quietly mixed. Intermediate breakouts: $KMI $SWK $PKG. Breakdowns: $GIS $WMT

Editor’s Note: After 10:15 AM EDT, breakouts included WBA, PNR, HRS, GD, FLR and HAS. No breakdowns.

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Wal-Mart $WMT, a Dow Jones Industrial stock moved below $94.29 setting an intermediate downtrend.

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S&P Metals & Mining SPDRs moved above $34.75 setting an intermediate uptrend.

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Soybean ETN $SOYB moved below $15.36 to an all-time low setting an intermediate downtrend.

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Long term Treasury Bond ETF $TLT moved below $117.80 setting an intermediate downtrend.

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Yield on 10 year U.S. Treasuries $TNX moved above 3.009 and 3.016 testing resistance at 3.115 prior to the FOMC meeting next week.

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Editor’s Note: TIPs also moved below support at $54.45

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Celestica $CLS.CA $CLS moved below $15.82 Cdn completing a Head & Shoulders pattern.

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Walgreen Boots $WBA, a Dow Jones Industrial stock moved above $70.95 extending an intermediate uptrend.

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Intact Financial $IFC.CA moved above $106.58 to an all-time high extending an intermediate uptrend.

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S&P 500 Equal Weight ETF $RSP moved above $107.89 to an all-time high extending an intermediate uptrend.

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Canada Manufacturing Sales down 7.1% (NSA) in July, much better than the 10.7% decline that is average for the month. $MACRO #CDNecon #CAD

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for September 18th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Commodities

Daily Seasonal/Technical Commodities Trends for September 18th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Sectors

Daily Seasonal/Technical Sector Trends for September 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 was unchanged yesterday at 67.60. It remains intermediate overbought and showing signs of rolling over.

 

TSX Momentum Barometer

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The Barometer was unchanged yesterday at 39.08. It remains intermediate oversold and trending down.

 

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 Wednesday September 19th 2018”

  1. rick Says:

    Bernie , good article yesterday but …

    too many mistakes !

    1. In title she had 2 million = in text is written 1 million
    2. She lost 450.000 in the big crash ( probably October 2008 ) => in few days she open an account with a discount broker => she lost in 2009-2010 so much money and she had to go back to work
    so she lost money too !?
    How much she lost in 2009 and 2010 and why ?

    Why in the article she said : “In the heady days of 2009 / 2010 it was almost impossible to make a bad buy” ?
    So how she lost money and she had to go back to work ?
    3. If she had 2 million $ and she lost 450.000 $ that is a loss of 22.5 %
    A lot of people lost 40-50 % in 2008 so that investment company did very well = losing only 22,5 %

    DGI&R: You mentioned that “After 2009-2010, the losses in my portfolio were so significant that I decided to go back to work part time as a consultant to shore up my accounts.” and later you said, “I had in excess of $1MM invested with a high net worth firm and they managed to lose a very large piece of that in the crash.”

    So did the amount she lost in 2009-2010 is more or less than the amount that the investment firm lost ?

    Missing info :
    1. how much she lost in 2009-2010
    2. how much she has now = more than 1 million ? more than 2 million ? more than she had in 2007 ?

    The good part :
    1. she bought back in 2009= many investors sold everything in 2008 and stayed in cash = never recovered = that was the big mistake ! but she did well
    2. she is spending 50 $ per year in trades and management fees and not 30.000 $ like before.

    The bottom line is :
    1. Do it yourself
    2. Stay invested for long term

    And the last question :

    from the article : “In preparation for the next bear (and I really hope it comes soon) I have invested in great quality dividend paying and growing companies. ”

    Why an investor want a bear market to come and hope to come soon ?
    Doesn’t she know that in a bear market her growing companies will lose money ? and some companies will cut dividends because of that ?

    Bernie , you mention your similar story .
    You wrote it 10 times better .
    Maybe you should write your experience again .

  2. Sherri Says:

    Armstrong on the DOW September 19:

    “The Dow has broken out to the upside but it is not yet through technical resistance. Today, a closing below 26406 is not a Reversal, but it will warn that we can still see a temp high with a Direction Change due tomorrow on the daily level. A Friday closing also below last week’s high of 26211 will also warn that we are still really just consolidating. The next real target will be the week of 10/01 so exceeding this week’s high next week should signal a further rally to Test the January high.

    As stated previously, exceeding this year’s high next year will most likely signal a Vertical Market into 2020/2021. The politics will play a role, but keep in mind that everything everywhere is just going nuts – not just Trump. Capital will move according to country risk. The volatility is likely to appear for December going into year-end. All we can do is follow the computer and the Reversals. That is the only way to deal with this political-economic uncertainty on absolutely every front globally. We also have a leadership election in Japan tomorrow. “

  3. Sherri Says:

    Interesting, we’ve just filled the gap in the DOW from the end of January. Can’t wait to see what’s next.

  4. Bruce Says:

    Tnx sherri

  5. Mary Says:

    Sherri
    Thanks. Appreciate your postings.

  6. Bernie Says:

    Rick,
    Re: #1

    I agree there are some mistakes in the article. I’m not sure if they were made by Ana, DGI&R or there was a computer hiccup.

    I think her investment with the high net worth advisor reached between $1M and $2M, probably closer to $2M before the crash. I think this because she mentioned her investment “had about $2MM” and later said “in excess of $1MM”. The $450,000 loss probably wasn’t her total loss. I believe she said it fell that much during her time spent on her Mediterranean cruise. That would have to have been between Sep 12th – Oct 19th when markets fell almost 30%. Another reason I think her investment was near $2M is because of the $30K she was paying in management and trading fees. There’s a good chance those fees were in 1.5% territory, ie; 1.5% of $2M equals $30K.

    I’m thinking her overall loss in 2008-09 before she released her advisor were likely much more than $450K, or 22.5% as you say. From May 2008 to Mar 2009 the Canadian and U.S. markets fell between 48%-54%. Ana’s losses were probably closer to 54% than 22%.

    Ana’s statement, “After 2009-2010, the losses in my portfolio were so significant that I decided to go back to work part time”, clearly had to be a typo by the author DGI&R. We all know the crash was in 2008-09, not 2009-10. Earlier Ana had said “In the heady days of 2009 / 2010 it was almost impossible to make a bad buy.” In my books this would confirm there was a mistake made by the author.

    Despite the mistakes made in the article it does make some good points as you have alluded to. I wish the author had asked her what she was invested in before during her time with the high net worth advisor and what her portfolio has in it now. Other than the timing I imagine her before and after investments were similar to mine. I released my advisor shortly before the downfall in 2008 to go it alone with a DGI portfolio so my paper losses would have been less severe than Ana’s. Yes my story is somewhat similar. I’ve also been asked by a blogger to give mine but I chose to decline. I just didn’t feel “my story” was newsworthy enough and I sure didn’t want to enhance it with philosophical quotes to pad the comments…lol. Seeing NRG’s, Ron/BC’s and your story would be much more interesting for everyone to see.

  7. Ron/BC Says:

    Bernie

    There will always be good reasons why individuals lose money on investments, especially stocks. The answer is stop hanging onto investments that are under water in price. No exceptions! “IF” it does “come back” you can buy it back once it stabilizes and is an attractive investment again with an improved economy. But people fall in love with their stocks and come up with reasons why they need to hold onto these albatrosses. They think if they don’t sell them they haven’t lost money yet which is ridiculous. If they were actually bleeding they wouldn’t just look at the blood flowing out of their body and say,I’ve got a lot of blood so wont worry about an injury like this which isn’t that bad. And once the bleeding stops I’ll make it up again over time. No,they would stop the bleeding quickly even though they have plenty more of the stuff. But investors rationalize as they don’t want to admit to themselves or others that holding the stock now is a poor investment that can be repurchased much later down the road when price stabilizes or that they made a mistake getting into the stock in the first place. Men are worse than women as they have the big egos that women don’t have for the most part. Plus women’s fear level is higher which helps them exit bad investments quicker. I’ve known investors that have lost everything including their marriage because of this “I can’t sell now” attitude. I find it so hard to believe some normally very bright people could be so foolish and financially irresponsible. Just like sitting their looking at a bleeding injury watching the blood running out and believing they’ll be ok if they just wait it out. I know from my own experiences over the decades once I sold a poorly performing stock that went below my purchase price I felt relieved and had clarity about that investment that I didn’t have when holding it. The best lesson I ever had was losing money on stocks that I dumped quickly. PRESERVATION OF CAPITAL IS JOB #1.
    I don’t have a stock story for 2008-2009. I switched CD$ for U.S.$ back and forth a few times and hit it perfectly 3 times in a row after major moves. I had the right idea and acted on it but there was a ton of b.s. luck as well as I’ve never duplicated those trades since. The next downturn and recession will do the same thing again to investors and they will hang onto those investments until the same thing happens all over again. Nothing is going to change and they’ll have a ton of reasons why they are keeping those losing stocks. Just like Lucy and the football.

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