StockCharts.com - Blogs

It has been an interesting week for Copper. If finally got some momentum to the upside and had a stellar day on Thursday. Dr. Copper is a strong indicator of economic activity so having it weaken so substantially since Feb 1 is concerning. We need copper to turn bullish. Lets go data mining here.

Here is a chart comparing the $TSX to the $SPX.

We can see that over the past 3 years the $TSX has outperformed the $SPX twice for any multi month length of time.

The purple shaded area is how the TSX performs to the SPX. 

While the current market is in correction, patience is required to wait for the commodity sectors to start jumping. $NATGAS is obvioulsy under a lot of pressure. The inventory data from the EIA in the US is a big deal. Normalyl to FILL the NATGAS storage from March to October we add 2.4 TCF over 6 months. It is already 2/3 full. So some storage venues on the continent could actually be full dropping NATGAS  to bizarre low prices. 

Oil and Gold both have different forces, but they also continue to have downward pressure currently. This continues to squeeze the TSX.

Good Trading, 

Greg Schnell, CMT

Here is the chart for the $SPTIN.

A few major concerns show up here. This has been declining for a while. Both the 40 week and the 10 week lines are pointed down. The RSI registered a bear market ahead. The Industrials are unable to push the RSI to overbought. It stopped in classic bear market territory. The full sto's have broken below 80 and the MACD has rolled over. THe MACD is still on the positive side of zero so that is somewhat good news.

The main problem is the lower highs and lower lows pattern. Losing it's 20 week MA would be a big problem. That is the centre line on the Bollinger bands. All of this is in contrast to the American Industrials.

Good Trading,

Greg Schnell, CMT

The Bullish percent index for gold miners turned up today. Now it only takes 1 or 2 stocks to make this change, but considering $GOLD was little changed it was interesting. What would cause a few stocks to go on a buy signal on P and F charts when the underlying day was weak? I like to look at $GOLD and I noticed it likes to bounce from around the 25th of the month to the 8th of the following month. Is this the start of something big?

I keep looking for some commodities to get a little love but this $Copper one keeps hurting the most. When I posted in January it went on a tear the very next day.... We'll see if it can get some love after this post!! The real disappointment in the mega rally today was copper moved up one cent after a horrific week last week.

Keep your eye on Dr. Copper. He seems to know more than the talking heads.

Here is the 3 year $TSX chart.

This is a major support line. Obviously we will need to hold here for the $TSX to be able to maintain the 3 year bull market. 

Good Trading,

Greg Schnell, CMT

Interesting $COPPER chart, while the earnings for Alcoa (Aluminum)were somewhat bullish.

Well, this Gold trade has worked most of the optimists into the prayer box. I believe it is still in a correction and this is my logic. You'll have to let me know if you agree or disagree.

Here is the GLD chart.

The $TSX continues it's rollover and is testing support at 12200.

The Aussie charts look a little stronger but they had exports fall significantly this month and they look to be starting an interest rate drop in the near future. Canada's GDP was 0.1%... The $TSX is telling us that global exports for commodities are down, and it is starting to show up in the export data. 

This 12200 is important support. 

There may be a better time to own commodities down the road but it is looking weak from my blog posts recently. You will also notice the volatility rising in copper. The daily moves are starting to get wider and wider. Indecision at the least.

Good trading,

Greg Schnell, CMT

Nice move in Bond yields after the fed minutes today.

In order, 30 Y, 10Y,5Y,2Y, 3 month. All moving higher..

To take this trade you could use a trade like TBT if you think the trend can continue. 

We are starting to see distribution days pile up on the US indexes so we'll be watching closely.

Good Trading,

Greg Schnell, CMT