The Canadian Technician

The $TSX - The New Market Leader

The $TSX is taking over leadership here. While I couldn’t be more bullish on the energy sector here, I can’t help but stare at the $TSX and wonder if the former highs will be resistance.

Here is the weekly long term view.

$TSX 20140419 8 year view

Chart 2 is the daily view. We had a nice bull candle breakout to a new high to close out the week. Watch closely to see if it holds. We closed at 14500. 14646 was resistance in 2007 and 15154 was the top in 2008. If the US market does roll over and pull back hard, I would expect the Canadian market to pull back as well. The recent euphoria on a weekly chart is huge and due for a rest. If the market is pricing in a lasting disagreement with Russia, we might find oil and gas soaring to new highs, but pressure showing on other areas.

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Defensive Industries Break Out

The Canadian $TSX may still look bullish, but that is not where the money is flowing too, it shows where the money has been. 

Two charts this week show breakouts. REITs and Utilities. 

XUT.TO 20140414

The chart above shows the Relative strength of the Canadian Utilities compared to the $SPX.  You can see an uptrend since March, but the breakout happened last week on this weekly chart. We can see the  200 DMA being broken and starting an uptrend. This is very bullish utilities.

Here is the REIT ETF.

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$TSX Canadian Sector Outperformance: A Debate

I received some mail the other day asking about the use of the $SPX on a performance chart rather than comparing to the $TSX for the Canadian Exchange Sectors. While the $SPX is a giant collection of varied undustry groups and sectors, the $TSX is heavily weighted to the Energy and Financial sectors.

Here are two charts. The top one is comparing the Canadian sectors to the $TSX and the second compares to the $SPX. Note the shaded box in the top left hand corner. Also, if you click on the charts, you'll need to click the histogram button bottom left to change it from a squiggly line chart.

Screen Shot 2014-04-06 at 10.44.00 AM

Here is the $SPX.

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$TSX Sector Picture Changes Rapidly In The Last Month.

The sectors have rotated rapidly in March.  This is the current view of a one month performance chart.

Screen Shot 2014-04-01 at 10.59.19 AM

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$NATGAS - A Bull Market Canadian Industry Complete with Stock Names

$NATGAS looks like one of the strongest trades of the year. This accumulation of stock names should be interesting to watch for the year 2014.This blog will provide a list of Natural Gas stocks in the Canadian market. I want to thank Landman Tim Campbell and others for helping me find the companies most influenced by natural gas.

The closest we are going to get on fundamental analysis is that they are natural gas stocks. No area plays, no reservoir analysis. Just Natural Gas Industry producers. I recognize there are also LNG players, Shippers, Clean energy companies, Engine modifiers all related to Natural gas. This is just looking at the Canadian listed Natural Gas producers. ECA is also listed on NYSE.

Lets start with the Natural Gas Chart.

$NATGAS 20140328

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The $TSX Runs Into Resistance At 14329 Again...

The $TSX is a great example of demonstrating both short term and long term resistance.

First here is the long chart.

$TSX 20140325

When the $SPX made highs in July 2007, the $TSX made a spike above this blue line. When the $SPX made a higher high in October 2007, the $TSX intra week made a higher high, but did not according to this weekly line chart. It closed the week at a lower level. Then oil went on the surge to infinity and topped out the $TSX on June 5, 2008. The $TSX built a nice 2 month head/shoulders topping pattern in 2008. The $TSX made a double top in 2007, 3 months apart. 14625 in July, 14630 in October.

Why is this all relevant? Not unlike the ceiling in 2012 where the market could not make new highs, long term charts exhibit that same trait.  Whether we push through here or not, we should expect some choppy water that will wear out both the bulls and the bears. We can see this area has been resistance before. so it is appropriate to tighten stops.  In 2011 our high was 11329. Now we have spent three weeks trying to get above that level.  

Look what happened so far intraday today.

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Some Canadian Energy Names Are Looking Interesting

As $NATGAS went through a price spike recently, we have seen some big moves into the $NATGAS stocks.

Encana and Perpetual are two Natgas names that are really starting to soar. It looks like the year for $NATGAS. Nice when the sector start to make multi year breakouts.

ECA.TO 20140323

 Encana went to 2 year highs this week.

The RSI at 70 has not happened for the last 5 years. The SCTR has moved above 75 which I find particularly attractive.

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My Global View Of The Current March Market 2014 - Part 4

The previous 3 articles dealt with the equity and bond markets. This one has just a few charts on $COPPER, $GOLD , $WTIC and $LUMBER.

Without discussing why $COPPER is an extremely important economic indicator here, it just is. The major news of the last 2 weeks has been $COPPER's plunge. Interestingly, it was two weeks ago the the Chinese Central Bank loosened the trading range on the Yuan, the Chinese currency. It was also marked by a couple of financial events in China. It is fair to say that this chart looks like the Chinese  Shanghai ($SSEC) stock market chart. We can see the RSI has been in bear market mode for three years, never getting above 65. It is also important to notice that $COPPER traditionally bounces off RSI 30 lows. We'll see. The purple area that I call the SPURS, comparing the $SPX to the price of $COPPER. The chart shows copper continuing to perform worse than the $SPX. One comment I heard was that this chart does not look anything like the US economy. True, but it might be a better example of the world market growth.

$COPPER 20140314

The Price chart is particularly compelling here.

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My Global View Of The Current March Market 2014 - Part 3

Ok, A quick review of what we have seen. Many of the global markets are building typical topping structures. The US market is still bullish, but recent price action suggests that the market is also showing signs of indecision.

At this point, I would like to make a quick run through of how tops form. Then we'll compare it to the current market situation. Sorry for the flipping, but it allows me to directly compare the data.

Lets start with the 2000 top. You will notice the $SPX kept revisiting the 1400 level back in 1999 and 2000. The July high became an interesting reference point. It marked the top of a head/shoulders pattern. You can see in September the market broke down confirming the right shoulder. Just eyeballing the right shoulder high as an August High. It then oscillated down to a low in October. It also broke the necklines at 1275. It made multiple dips below the 200 DMA. Every technician probably got bearish.

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My Global View Of The Current March Market 2014 - Part 2

If you did not read Part 1, some of these explanations may not be clear enough.

Continuing into Europe, let's go through the charts.

France is an interesting market. It still has the camel humps, but it has a flat base line. This is an expanding wedge or a megaphone pattern. It is considered a pattern of indecision.

0010 France

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