Pre-opening Comments for Friday July 8th
U.S. equity index futures were lower this morning. S&P 500 futures were down 18 points in pre-opening trade.
Index futures were moved lower following release of the U.S. June Employment report at 8:30 AM EDT. Consensus for June Non-farm Payrolls was a drop to 265,000 from revised 384,000 in May. Actual was an increase of 372,000. Consensus for the June Unemployment Rate was unchanged from May at 3.6%. Actual was unchanged at 3.6%. Consensus for June Average Hourly Earnings was an increase of 0.3% versus a gain of 0.3% in May. Actual was an increase of 0.3%. On a year-over-year basis consensus for June Average Hourly Earnings was a gain of 5.0% versus a gain of 5.2% in May. Actual was a gain of 5.1%.
The Canadian Dollar slipped 0.23 to U.S. 76.77 cents following release of Canada’s June Employment Report at 8:30 AM EDT. Consensus was an increase of 25,000 versus a gain of 39,800 in May. Actual was a drop of 43,200. Consensus for the June Unemployment Rate was unchanged from 5.1% in May. Actual was a drop to an all-time low at 4.9%.
Levi Straus added $0.69 to $17.10 after the company reported higher than consensus fiscal second quarter revenues and earnings.
![clip_image001[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2022/07/clip_image0011-4.png "clip_image001[1]")
Game Stop plunged $8.12 to $127.00 after the company’s Chief Operating Officer was terminated.
![clip_image002[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2022/07/clip_image0021-3.png "clip_image002[1]")
Costco added $0.05 to $495.00 after announcing a 20.4% increase in June sales.
![clip_image003[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2022/07/clip_image0031-3.png "clip_image003[1]")
EquityClock’s Daily Comment
Headline reads “The reset of the price of Natural Gas and the ongoing favourable fundamental backdrop is providing us another shot to gain exposure to this commodity”. Following is a link:
http://www.equityclock.com/2022/07/07/stock-market-outlook-for-july-8-2022/
Technical Notes Yesterday
Broadly based U.S. equity indices (i.e. S&P 500 Index, Dow Jones Industrial Average, Dow Jones Transportation Average., Russell 2000 Index, NASDAQ Composite Index) and their related Exchange Traded Funds moved above their 20 day moving average.
Microsoft $MSFT a Dow Jones Industrial Average stock moved above $268.30 completing an intermediate reversal pattern.
Alphabet $GOOG moved above $2,387.87 completing a double bottom pattern.
DexCom $DXCM a NASDAQ 100 stock moved above $81.24 completing a double bottom pattern.
Vertex Pharmaceutical $VRTX a NASDAQ 100 stock moved above $275.83 extending an intermediate uptrend.
CCL Industries $CCL.B.TO a TSX 60 stock moved above Cdn$62.07 extending an intermediate uptrend.
Trader’s Corner
Equity Indices and Related ETFs
Daily Seasonal/Technical Equity Trends for July 7th 2022
Green: Increase from previous day
Red: Decrease from previous day
Commodities
Daily Seasonal/Technical Commodities Trends for July 7th 2022
![clip_image002[5]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2022/07/clip_image0025.png "clip_image002[5]")
Green: Increase from previous day
Red: Decrease from previous day
Sectors
Daily Seasonal/Technical Sector Trends for July 7th 2021
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)
Links offered by a valued provider
Greg Schnell discusses the “oil down, tech up”rotation
Oil Down, Tech Up | Greg Schnell, CMT | Market Buzz (07.06.22) – YouTube
S&P 500 Momentum Barometers
The intermediate term Barometer added 2.20 to 29.00 yesterday. It remains Oversold, Trend is up.
The long term Barometer added 1.60 to 23.20 yesterday. It remains Oversold.
TSX Momentum Barometers
The intermediate term Barometer added 5.54 to 23.53 yesterday. It remains Oversold. Trend is up.
The long term Barometer added 5.14 to 27.31 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.
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July 8th, 2022 at 7:50 pm
Cash ETFs: there are several, but I decided to split my cash into 4 chunks, to get a better than average yield and improve safety, although not much to worry about there. I just feel better splitting my money around, rather than dumping it all in one spot. I also picked well known ETF companies.
These days you have to pay a trading fee, so you have to have enough money to make it worthwhile, doesn’t work with small amounts under $5,000. The bigger the better. Don’t forget, commission in, then commission out.
These are all classified as Money Market Funds. I feel uncomfortable with any that pay too much vis-a-vis current short term rates. The units bounce around a couple pennies this way and that depending on the daily market conditions, but since we are in a rising Interest Rate climate, I expect the pay-outs to rise aggressively as we move forward.
1) CMR ETF (iShares): This one I used to use a lot for several years when rates were higher, could get 1 or 2%. Past 2 years, not worth it as the MER is .25 basis points and the interest rates were just that, so you got zero. May as well leave your money at zero interest in your account. Made no sense. I could buy it commission free in Scotia ITRade for years, but these days no longer, have to pay a commission. However, earlier this year, paid zero, 2 months ago .10, this month so far .20, and I would expect after next week rate increase much higher. Advantage, fully liquid, pays monthly, pay will go up as rates increase. All Government Fed and Provincial, some Corp: T-Bill, short term bonds, 30-60-90 day money. Very stable. Pays currently .21%
2) CSAVE (CI GLOBAL) : The First Asset ETFs investment objective is to maximize monthly income for unit holders while preserving capital and liquidity by investing primarily in high interest deposit accounts. Currently pays .65%.
3) PSA (Purpose Invest):I met the guy who runs it some years ago, so feel comfortable with it. The fund seeks to maximize monthly income for unit holders while preserving capital and liquidity by investing in high interest deposit accounts. The fund invests substantially all of its assets in high interest deposit accounts with one or more Chartered Banks and/or Canadian Credit Unions. Pays .79%
4)CASH (Horizons ETFs): CASH seeks to maximize monthly income for unit holders while preserving capital and liquidity by investing primarily in high interest deposit accounts with Canadian banks. Currently pays 1.83%.
4 equal weight positions average : about .87%. Not much, but not losing money and actually outperforming the market by not losing money. This pay-out will improve monthly as we march forward. Pays monthly, fully liquid in seconds, can be margined, stable, solid capital preservation. Good enough for me. I can just go to the beach and wait until the BOC and FED are done, the market bottoms, and I see a great buying opportunity.
Like someone said many years ago, think of a stock as a yard stick, I don’t care about buying at the bottom or selling at the top, all I care about is getting a good 2 feet in the middle. I’m not going back into equities until I see a turn in the market. Right now all below 200DMA and trending lower, bias is to the down side, why bother? I got better things to do.
July 10th, 2022 at 1:46 pm
Michael,
Thanks for sharing your perspective on the current state of the market, your investment philosophy and what you are doing with your cash. If you can also talk about what dividend paying equities you like I would be very interested.