Tech Talk for Wednesday December 12th 2018

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Pre-opening Comments for Wednesday December 12th

U.S. equity index futures were higher this morning. S&P 500 futures were up 23 points in pre-opening trade.

Index futures were virtually unchanged following release of the November Consumer Price Index at 8:30 AM EST. Consensus was unchanged versus an increase of 0.3% in October. Actual was unchanged. Excluding food and energy, consensus for the November Consumer Price Index was an increase of 0.2% versus a gain of 0.2% in October. Actual was an increase of 0.2%.

WTI Crude Oil gained $1.04 to $52.69 per barrel after API crude oil inventories announced after the close yesterday dropped 10 million barrels last week.

American Eagle Outfitters (AEO $19.03) is expected to open lower after reporting less than consensus quarterly revenues. The company also issued negative guidance.

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eBay dropped $0.55 to $28.50 after Morgan Stanley downgraded the stock to Equal Weight from Overweight. Target was reduced to $33 from $55.

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Verizon slipped $0.92 to $57.93 after Morgan Stanley downgraded the stock to Equal Weight from Overweight. Target is $58.

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Interesting article published by www.MarketWatch.com late yesterday

Headline reads, “A violent and crushing move higher is taking shape this month, analyst says”.

Following is a link:

https://www.marketwatch.com/story/a-violent-and-crushing-move-higher-is-taking-shape-this-month-analyst-says-2018-12-11

 

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2018/12/11/stock-market-outlook-for-december-12-2018/

Note seasonality chart on U.S. Producer Price Index

Equity Clock subscribers were given greater insight on what is driving the aggregate result and why the results may be a net positive for the broader economy.  You too can receive this research and analysis right to your inbox by subscribing via the following link: https://charts.equityclock.com/subscribe

StockTwits Released Yesterday @EquityClock

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

Editor’s Note: After 10:00 AM EST, intermediate breakouts included TWTR, DLR and CHD. Breakdowns: DRI, TGT and FLT

Key indicator of breadth already suggesting a bear market trend. equityclock.com/2018/12/11/… $NYA $SPX $DJIA

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US #PPI FD less food and energy up 0.3% (NSA) in November, stronger than 0.1% increase that is average. $MACRO #Economy #Inflation

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Trader’s Corner

Equity Indices and related ETFs

Daily Seasonal/Technical Equity Trends for December 11th 2018

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Green: Increase from previous day

Red: Decrease from previous day

Commodities

Daily Seasonal/Technical Commodities Trends for December 11th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Sectors

Daily Seasonal/Technical Sector Trends for December 11th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

A Closer Examination of the Copper/Base Metals sector

The sector looks attractive for a seasonal trade to spring.

Possible ways to play the sector:

Copper futures

Copper ETN: JJCTF

Copper equity ETF: COPX

Base Metal Equity ETFs: PICK, XBM.TO ZMT.TO

Base Metal equities

Country ETF: ECH

 

Fourth quarter earnings reports by major base metals producers will be mixed: lower on a year-over-year basis when copper in the fourth quarter last year averaged $3.10 U.S. per lb, but higher than the third quarter this year when copper averaged $2.65 per lb. Many producers likely will offer positive guidance when fourth quarter results are released.

Technicals for copper improved yesterday: Intermediate trend already was up. Relative strength recently turned up. Short term indicators (20 and 50 day moving averages/ short term momentum) turned higher. A move by copper futures above $2.87 U.S. will extend an intermediate uptrend and attract technical buying.

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Seasonal influences for copper turn positive this week for a potential seasonal move to the end of April.

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Copper inventories on the London Metal Exchange recently dropped below their lowest level in five years.

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Ditto for zinc inventories!

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Largest demand for copper/base metals comes from China. Successful U.S/China trade negotiations during the next three months will boost significantly the demand for copper in China.

Chile is the largest copper producing country in the world. Its ETF closely tracks the price of copper.

Technical action by individual base metal stocks (e.g. Hudbay Minerals, Lundin Mining,Teck Resources) already has turned positive. All established intermediate uptrends and positive strength relative to the TSX Composite Index and S&P 500 Index during the past six weeks.

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Seasonal influences for base metal equity indices, stocks and ETFs recently turned positive for a move into spring.

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S&P 500 Momentum Barometer

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The Barometer added 1.40 to 30.20 yesterday. It remains intermediate oversold.

 

TSX Momentum Barometer

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The Barometer dropped another 2.48 to 29.75 yesterday. It remains intermediate oversold.

 

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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6 Responses to “Tech Talk for Wednesday December 12th 2018”

  1. FishFat Says:

    TechTalk, nice work today on the copper/base metals sector highlight. Thanks.

  2. ana Says:

    If we get up to the 2692 – 2698 area we might pull back down to 2640 ish.

    Watch on the 5-minute chart.

  3. Roy Says:

    Anyone able to tell me about SU(Suncor)?
    When is the right time to buy the stock? On the equity clock website time to buy on the TSX is Dec 7, but time to buy on the US exchange is Jan 7th. Why the big difference in buy dates?

  4. Polish1 Says:

    daily GUSH chart, still fleshing this potential wedge
    https://stockcharts.com/h-sc/ui?s=GUSH&p=D&yr=0&mn=6&dy=0&id=p8634285277c&a=633041077&listNum=59

  5. Polish1 Says:

    BKX banks
    potential doji forming, if it closes like that would be a positive
    https://stockcharts.com/h-sc/ui?s=%24BKX&p=D&yr=0&mn=8&dy=0&id=p0207828362c&a=635543160&listNum=61

  6. Polish1 Says:

    ASNS Daily View
    the big boy funds of biotech (Orbimed, etc) involved in this stock. X-4 private company just reversed merged into ASNS in late November and thus the reason for the massive ramp in volume.
    https://stockcharts.com/h-sc/ui?s=ASNS&p=D&yr=0&mn=6&dy=0&id=p2912282234c&a=635549563&listNum=59

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