Canada’s Great Technical Analyst’s Bottom Line – 44 Charts

Posted by Don Vialoux - Timing the Market

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The S&P 500 Index fell 40.75 points (3.65%) last week. Intermediate trend remains down. Support is at 1,040.78. Short term momentum indictors have rolled over: Stochastics rolled over from an overbought level. The Index found resistance at its 50 day moving average currently at 1,127.96 and subsequently fell below its 200 day moving average. A test of support appears imminent.


The TSX Composite Index gave up 219.74 points (1.84%) last week. Support is at 11,179.97. The Index briefly moved above its 50 day moving average, but quickly faded and is now testing its 200 day moving average. Short term momentum indicators have rolled over. Stochastics rolled over from an overbought level. Strength relative to the S&P 500 Index remains positive.


The Canadian Dollar fell 2.26 cents U.S. last week. Long term support is near 93 cents. Resistance is at 100.51. Short term momentum indicators have rolled over. Stochastics rolled over from a short term overbought level.


Crude Oil gained $0.95 U.S. per barrel last week. All of the gains occurred on Friday on concerns that a tropical storm heading to the Gulf could shut down energy production. Concerns lessened over the weekend. Stochastics are short term overbought and show signs of rolling over. For those who believe in a bearish “Death Cross” (i.e. the 50 day moving average moving below the 200 day moving average, it happened on Friday.


Natural gas prices historically reach a seasonal peak in the middle of June and move significantly lower until near the end of August. History is repeating. .HHi Gas Futures (NG) Seasonal Chart


Gold, Silver and many more charts HERE

The Bottom Line
A cautious equity strategy is recommended. Some special situations exist (e.g. medical devices and biotech) and several special situations possibly could surface this summer (e.g. gold, agriculture, health care, consumer staples). Stay tuned for further developments.