Tech Talk for Wednesday June 29th 2022

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Pre-opening Comments for Wednesday June 29th

U.S. equity index futures were higher this morning. S&P 500 futures were up 6 points in pre-opening trade.

Index futures were virtually unchanged following release of an update on U.S. annualized first quarter real GDP at 8:30 AM EDT. Consensus was unchanged at a deficit of 1.5%. Actual was a deficit of 1.6%.

Couche-Tard dropped $1.96 to Cdn$53.38 after the company reported less than consensus fourth quarter results.

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Carnival plunged $0.82 to $9.51 after Morgan Stanley lowered its target price on the stock.

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General Mills gained $1.74 to $72.00 after reporting higher than consensus fiscal fourth quarter results. The company also increased its dividend by 6%.

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Bed Bath & Beyond dropped $0.62 to $5.91 after reporting a higher than consensus first quarter loss

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EquityClock’s Daily Comment

Headline reads ”The more that the consumer becomes strained, the more they are turning towards debt”. Following is a link:

http://www.equityclock.com/2022/06/28/stock-market-outlook-for-june-29-2022/

Technical Notes for yesterday

Nike $NKE a Dow Jones Industrial Average stock moved below $103.20 following release of quarterly results extending an intermediate downtrend.

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Trip.com $TCOM a NASDAQ 100 stock moved above $25.04 and $25.57 extending an intermediate uptrend.

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Boeing $BA a Dow Jones Industrial Average stock moved above intermediate resistance at $142.31.

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Lithium ETN $LIT moved above $77.02 setting an intermediate uptrend.

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Hong Kong iShares $EWH moved above $22.20 setting an intermediate uptrend.

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Baidu $BIDU a NASDAQ 100 stock moved above $155.70 extending an intermediate uptrend.

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Trader’s Corner

Equity Indices and Related ETFs

Daily Seasonal/Technical Equity Trends for June 28th 2022

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Green: Increase from previous day

Red: Decrease from previous day

Commodities

Daily Seasonal/Technical Commodities Trends for June 28th 2022

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Green: Increase from previous day

Red: Decrease from previous day

Sectors

Daily Seasonal/Technical Sector Trends for June 27th 2021

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Green: Increase from previous day

Red: Decrease from previous day

All seasonality ratings are based on performance relative to the S&P 500 Index (except TSX)

 

S&P 500 Momentum Barometers

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The intermediate term Barometer dropped 7.20 to 14.80 yesterday. It remains Oversold.

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The long term Barometer eased 1.80 to 23.00 yesterday. It remains Oversold.

 

TSX Momentum Barometers

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The intermediate term Barometer slipped 0.42 to 15.06 yesterday. It remains Oversold.

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The long term Barometer was unchanged at 27.20 yesterday. It remains 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.




6 Responses to “Tech Talk for Wednesday June 29th 2022”

  1. FishFat Says:

    XBI, SPDR Equal Weight Biotech ETF
    The chart for XBI has bullish potential. See attached. There is positive divergence on multiple indicators. A double bottom has formed since mid-May. Performance relative to the SPX has turned positive. However, the CCI indicator is overbought, so a pullback of some sort may yet occur. For me the risk/reward potential makes this a good entry point. Just to be clear, XBI is still in a downtrend. The positive chart attributes may only be indicating a shift to a sideways trade. I believe Paula has highlighted this trade in recent weeks, good call Paula.
    https://schrts.co/hRNriwjX

  2. Paula Says:

    FishFat,

    RE #1. XBI

    Thanks for continuing the conversation. I changed the ratio on your chart to compare it to XLK, rather than $TSX. Not sure if I drew the trendline correctly. Feel free to adjust. I also made it slightly smaller so I could see it without scrolling sideways. Don’t know if the XLK is the best etf to compare, but it might as good as the SPY.

    https://schrts.co/uuukDuZE

    I agree with you on all the bullish divergences but I have found that they don’t mean a lot if there is a distinct downtrend. On a longer term, weekly, chart, see second attachment (courtesy of Ron/BC), there seems to be strong support at the 62ish level with previous bounces up to just under 100ish. BUT, not too far above where the price is now is the descending 20EMA ~ 80, so expect to have some strong resistance. Also, that was the previous low/support from where it broke down most recently. Also the RSI(8) indicator seems to be having trouble getting above the 50 level.

    https://schrts.co/CNBeFzpD

    On a daily chart, also courtesy of Ron/BC, the RSI(8) indicator touched the 70 level and has since pulled back along with price. Perhaps this corresponds with your overbought CCI indicator.

    https://schrts.co/AecSTNRf

    I have found XBI to be extremely volatile, so could expect a pullback and possible test of the 70ish level, especially as the overall market volatility continues. If you have access to intraday charts, this pullback since last Friday has already brought the hourly RSI(8) down from overbought to touch the 30ish area, as well as the price tested the rising 50EMA ~ 73.50, so perhaps today’s low at 72.78 provided a “cooling off” before proceeding up to test the 80ish level. BUT, there was a previous short term high at 78.95 in early May, so it could be argued that the more recent high at 77.66 was a lower high. Maybe it already hit the higher side of an overall lower trading range as long as the overall market is in a bear. Good luck with this one.

  3. Ron/BC Says:

    Paula/FishFat
    Re:XBI
    Here is a Weekly 8 year chart of XBI and one can see the obvious support at $62 with plenty of bullish indicators suggesting further gains, but with resistance levels ahead. A pullback to $65 would not surprise me and would be the place to get long imo. Lots of dollars to be made and lost on this one!

    https://stockcharts.com/h-sc/ui?s=XBI&p=W&yr=8&mn=0&dy=0&id=p25650270433&a=1196562201

  4. Ron/BC Says:

    Paula
    Re:#3

    I should add that the “GOOD BOOK” of Technical Analysis would say if price tests a price support for a 3rd time then that is not bullish but bearish and is likely to break down as the two previous bounces off that support failed to “follow through” to the upside BUTTTTTTTTTT I’d be tempted to get long on another test of the $65 “area”.

  5. Paula Says:

    Ron BC,
    Agree 65 is possible and would be good risk /reward entry.
    Thanks for the input.

  6. FishFat Says:

    re: XBI
    Paula; You are right, plotting performance of XBI against the TSX makes little or no sense. I did mean to plot performance relative to the SPX but in my haste to get out the door this morning, I plotted against the TSX. Thanks for catching and correcting that error.

    Paula, Ron/BC
    Enjoyed your comments and insights. A test of the $62 level would shiver me timbers. I don’t want to go there (or at least not past there).

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