One Of Canada’s Great Technicians analyses 51 Market Indexes and Commodities

Posted by Don Valiloux - Timing the Market

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Editor Note: Highly recommend that you take a regular monday visit to Don Vailoux’s report where he usually analyses an astonishing 50+ Stocks, Commodities and  Indexes.

Pre-opening Comments for Monday May 4th

U.S. equity index futures are slightly higher. S&P 500 futures are up 2 points in pre-opening trade. Equity futures are responding to encouraging news from China last night. The Chinese manufacturing sector continues to show accelerating growth. The Shanghai Composite Index gained 82 points to 2,560 and is testing its recent high at 2,579.

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The prices of commodities related to recent Chinese buying are trading higher.

First quarter earnings continue to exceed expectations. Sprint Nextel and Tyson reported better than consensus operating earnings this morning.

Major U.S. bank stocks are trading slightly lower this morning on news from the media that Bank of America and Citigroup are considering the possibility of raising $10 billion of fresh capital. Bank of America denied the report.

Research in Motion is trading higher this morning on news that Goldman Sachs has added the stock to its “conviction buy” list.

The TSX Composite Index slipped 52.52 points (0.55%) last week. The Index has gained 27.0% from its March 6th low. Intermediate trend is neutral. Support is at 7,479.96. Resistance is at its 200 day moving average at 9,988. MACD, RSI and Stochastics are short term overbought. Strength relative to the S&P 500 Index is showing early signs of changing from positive to negative.

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The currencies of commodity-sensitive countries were exceptionally strong last week. The Canadian Dollar gained 1.89 cents U.S. last week and is testing resistance at 85.02. A break above resistance implies an intermediate technical target of 92.5 cents where resistance exists.

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….HERE to see the entire analysis of the 51 charts and commentary.

The Bottom Line
Technical, seasonal and fundamental influence on equity markets and sectors suggest that traders should start to lighten up on equity and ETF positions on strength between now and the end of May. Preferred strategy is to complete a series of sell transactions during this period (as opposed to a single sale of positions). Another alternative is to sell at or near the money calls against existing security positions. Preferred expiry month is June.

 

 

Don Vialoux has 37 years of experience in the Investment Industry. He is a past president of the Canadian Society of Technical Analysts (www.csta.org) and a former technical analyst at RBC Investments.  Now he is the author of a daily letter on equity markets available free on the internet. The reports can be accessed daily right here at www.dvtechtalk.com.

Impossible! That’s what institutional investors say about “Timing the Market”. Mr. Vialoux will explain that, indeed, it can be done with the appropriate analysis. He also will explain why timing the market will be important during the next decade. Buy and Hold strategies are not working anymore; Investors are looking for alternatives. Mr. Vialoux will demonstrate four techniques that can be used to time intermediate stock market swings lasting 5-15 months. The preferred investment vehicles for investing in intermediate stock market swings are Exchange Traded Funds.

Comments in Tech Talk reports are the opinion of Mr. Vialoux. They are based on technical, fundamental and/or seasonal data that is believed to be accurate. The comments are free. Mr. Vialoux receives no remuneration from any source for these services. Comments should not be considered as advice to buy or to sell a security. Investors, who respond to comments in Tech Talk, are financially responsible for their own transactions.