Tech Talk for Thursday March 26th 2020

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Pre-opening Comments for Thursday March 26th

U.S. equity index futures were lower this morning. S&P 500 futures were down 43 points in pre-opening trade.

Index futures recovered slightly following release of economic news at 8:30 AM EDT. Consensus for Weekly Jobless Claims was a jump to 1,500,000 from 281,000 last week. Actual was 3,283,000. Consensus for third estimate of fourth quarter GDP was unchanged from the third quarter at an annual rate of 2.1%. Actual was 2.1%.

Micron added $2.03 to $44.53 after reporting higher than consensus fiscal second quarter revenues.

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Bristol-Myers Squibb (BMY $49.35) is expected to open higher after receiving FDA approval for a new MS drug.

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Alphabet slipped $1.62 to $1,100.00 after SunTrust lowered its target price from $1600 to $1350.

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Ford dropped $0.31 to $5.08 after Standard & Poor’s lowered its debt rating to junk status.

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EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2020/03/25/stock-market-outlook-for-march-26-2020/

Note seasonality charts on Durable Goods Orders and U.S. crude oil inventories.

StockTwits released yesterday @EquityClock

Production of gasoline has completely fallen off the pace of the seasonal norm in the latest week as product supplied of the commodity also plummets. $USO $UGA $XLE $XOP

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Coffee ETN $JJOFF moved above $11.11 setting an intermediate uptrend.

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Trader’s Corner

Equity Indices and related ETFs

Daily Seasonal/Technical Equity Trends for March 25th 2020

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Green: Increase from previous day

Red: Decrease from previous day

 

Commodities

Seasonal/Technical Commodities Trends for March 25th 2020

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Green: Increase from previous day

Red: Decrease from previous day


Sectors

Daily Seasonal/Technical Sector Trends for March 25th 2020

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Green: Increase from previous day

Red: Decrease from previous day

 

Greg Schnell’s Market Buzz

Greg asks, “A rally of significance”? Following is a link:

https://www.youtube.com/watch?v=nan6ciqmcE8&feature=youtu.be

 

S&P 500 Momentum Barometer

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The Barometer slipped 0.40 to 1.20 yesterday. It remains deeply intermediate oversold.

 

TSX Momentum Barometer

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The Barometer gained 1.30 to 5.65 yesterday. It remains deeply intermediate oversold and are starting to show significant signs of bottoming.

 

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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23 Responses to “Tech Talk for Thursday March 26th 2020”

  1. Rol Lew Says:

    https://video.search.yahoo.com/search/video?fr=mcafee&p=SKEW+INDEX#id=6&vid=134dc08912cce24b3f01c1eedea47fe8&action=view

    https://stockcharts.com/h-sc/ui?s=%24SKEW&p=D&yr=1&mn=3&dy=0&id=p84533206509

    lower trending $SKEW = less put buying / hedging (?), also short covering(?)

  2. dave/ab Says:

    Hi Rol Lew

    Thanks for sharing the video on Skew. I have been doing a lot of OTM options. I have been wondering if there was an index that would track all of these. This index is different than the VIX that is ATM option index.

  3. dave/ab Says:

    Hi Ron

    My charting website will not let me do a comparison graph. Wondering if you can plot $skew and $vix together. Thanks very much.

  4. Paula Says:

    Ron/BC,
    As usual, thanks so much for your excellent charts. I realized that I had saved so many of them, it was getting confusing so I am trying to consolidate them and came across this discrepancy.
    The low on these two $SPX charts is a different number and that affects the Fib levels.
    Am I doing something wrong? Or is there another explanation?

    http://schrts.co/KzjWrxZC

    http://schrts.co/QngECqtt

  5. Canuck2004 Says:

    Couple things to keep in mind:

    1) Tomorrow is Friday…after a week of solid gains, markets often sell off as traders want to cash in profits. In times of great turmoil, wars, etc. traders do not want to hold stocks over the week-end as one never knows what ugly news may manifests itself when they cannot trade until Monday morning. Safety issue. Potential down day.

    2) Tuesday is end of the month and end of the first quarter. Fund managers want to “window dress” their accounts to show client when they report their end of the month or first quarter results, that they held the “right” stocks…so they sell their “losers” so they don’t appear on the balance sheet. Makes them look smart….so often the last day of the month, especially quarter, there is a sell-off. Potential down days Monday and Tuesday.

    3) Wednesday, first day of the month, after clearing the slate the day before, fund managers begin to buy again. A fresh month ahead, potential for gains so managers position themselves accordingly. Often a strong “up” day.

    This is the usual pattern in a normal market. Not always happen this way, but often enough to take heed. What will really transpire can’t tell you…all I can say is keep it in mind.

  6. Ron/BC Says:

    Dave/AB

    Here is a chart of $SKEW with the $VIX overlaid. Don’t know if this is what you are looking for or not as I’ve added a 50ema and 200ema and on the $SKEW rather than dotted lines I’ve changed them to a solid line. I can get rid of the changes but thought this compared them better. You could possibly change this chart as well to your own particular preferences. Let me know.

    https://stockcharts.com/h-sc/ui?s=%24SKEW&p=D&yr=2&mn=0&dy=0&id=p48526404828&a=730997680

  7. Ron/BC Says:

    Paula

    The first chart you posted was a line chart (closing prices only) and the 2nd chart you posted was an OHLC chart showing all prices traded that day. Notice the last day that made the low on the lowest OHLC day there was a 100 point range that day. Bottom line is the OHLC day makes for a wide range so measuring Fib ranges from the same thing on the high to the same thing on the low will give you wider parameters.

    Getting very very boring in Victoria. Can’t even golf. It is nice to walk the beach and listen to the crunch of the sand with the water lapping the shoreline though.

  8. Paula Says:

    Ron/BC
    Thanks for the explanation. Of course, the difference is b/t closing prices only, as represented by a line chart and OHLC chart which shows the range. I didn’t see the obvious difference, so thanks again.

    Walking on the beach sounds great! I can only imagine…

  9. Ron/BC Says:

    https://www.youtube.com/watch?v=6X7Sx62plCw&list=RD6X7Sx62plCw&start_radio=1

  10. FishFat Says:

    Re:#5 Canuck2004
    Thoughtful insights – much appreciated.

  11. Wayne Says:

    Canuck2004,
    Thanks for the reminder.
    Keeping my powder dry as I expect another move down.

  12. still_learning Says:

    Further to #5 from Canuck2204:

    The bottoming process is a funny thing because it is all driven on emotion. Currently, the market looks like it wants to go higher but that can flip on a dime. As we go into month-end/quarter-end, some of the big hedge funds in the States might be forced to liquidate positions in portfolio based on withdrawal requests that could have happened weeks ago. Basically hedge funds either have monthly, quarterly or annual redemption dates. The client needs to have the request in to sell like 3 weeks before month end generally. If hedge funds had a bunch of liquidation requests back when the market was tanking, they will be forced to liquidate at month end or beginning of April. Time will tell if this is the case or not.

  13. Florence Says:

    Ron/BC #9 Just love that Kenny Rogers! Thanks for the video, Maybe one day I will remember when to “fold ’em”!

  14. Florence Says:

    Canuck2004: Thanks for the info for Fridays and month end! Also wanted to ask – did you ever belong to a “Trust” group on Stockhouse? Your handle is familiar.

  15. Ron/BC Says:

    Florence

    Re:#13 Well just keep in mind you didn’t marry that position you just are having a brief affair with it. I got rid of my XSP.to Tuesday with a small loss and “IF” I had kept it I’d be making money on it. Doesn’t bother me a bit as I was wrong on the entry point and with other factors to deal with recently I wasn’t paying attention. Managing risk is critical so I’ve managed it safely now with no major repercussions and have that cash back to do whatever I wish with now in a calm and rational way. P.S. The 2nd song on that video is especially meaningful as well..

  16. Muntazir Says:

    Hi Bernie,

    Thanks for the video about 2 weeks ago. Just to let you know I own 8 out of 10 stocks. The ones I don’t own are cp & cu. RE: nvu wish I would have seen the video earlier. Anyways no pain no gain

  17. dave/ab Says:

    Hi Ron
    #6

    Thank you very much. It is what I was looking for. I’m looking to see correlation and if there is much of an early warning. They kind of move in opposite direction. But still good info. Thank you very much.

  18. dave/ab Says:

    Hi Ron
    #6

    Thank you very much. It is what I was looking for. I’m looking to see any correlation and if there is much of an early warning. They kind of move in opposite direction. But still good info. Thank you very much.

  19. Ron/BC Says:

    Dave/AB

    Here is another way of looking at it using a Ratio chart of $SKEW:$VIX and then overlaying the $SPX. I prefer this one,not that I’ve played around with the $SKEW before.

    https://stockcharts.com/h-sc/ui?s=%24SKEW%3A%24VIX&p=D&yr=2&mn=0&dy=0&id=p34289766188&a=731256676

  20. Bernie Says:

    Muntazir,

    Re: #16
    You’re welcome. Nothing earth shattering in the video but it does make one think hard about their core holdings. The 10 “essentials” make a lot of sense with respect to dividend safety, long term growth and how vital they are to our economy.

  21. Bernie Says:

    Muntazir,

    Also nice to see the author/presenter isn’t selling anything.

  22. dave/ab Says:

    Hi Ron
    #19

    thank you very much. $swek and SPY track very similar.thank you very much. I’m going to pay around with both of them and see if much comes up with it. Thank you very much.

    Dave

  23. JP/BC Says:

    Muntazir or Bernie: Can you provide the link (again) referenced in #16. Thanks

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