The Canadian Technician

Three Gushing, Below The Radar, Energy Stocks

Oil stocks have rallied recently over the last few days. While it would still appear to be a volatile time to look for entries some charts are starting to form bases longer than a few days.

The big names are always in focus north of the 49th but there are some interesting tickers that have much better chart patterns.

  • Parex PRX.TO
  • Total Energy Services TOT.TO
  • Advantage Oil and Gas AAV.TO

Here is Parex Resources (PXT.TO) with an SCTR of 95.9. Nice break above resistance yesterday with follow through today. $11.10 will be very interesting resistance.

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Is The Auto Business Blowing Black Smoke Because Of Emissions? US & Canadian Edition

I created an article over on Commodities Countdown blog (please connect if you are interested by subscribing at the bottom of any article as it does not currently appear on the blogs page) about the car business charts globally. Is The Auto Business Blowing Black Smoke Because Of The Emissions Crisis? I would encourage you to read that. However, I wanted to examine Magna, Martinrea and Linamar for Canadian investors. Also, I will be doing a commodities-focused webinar this afternoon where I will dip my toe in on this area of the market. (Commodities Countdown 20150924).

Magna (MG.TO)  or MGA in USA has been a wonderful growth story and the stock launched a few years ago. Luckily, we had an article right here on this page explaining how good things were going to get. Magna Looks Magnificent (20121220). That came a week after the big bold headline of a new bull market. 2012 12 12 Announcing The Global Bull Market. I didn't trade that as well as I should have!

If you read the Magna article, you'll have seen the setup. Here is the updated chart. I made a reference to my friend Tom McClellan, who suggested never look for a top when you're staring at the base. This is a pretty good example of why! 

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Canadian Stock Market ($TSX) Webinar Highlights 20150915

We fired through a lot of charts on Tuesday. Here are some of the webinar highlights. The Canadian Stock Market ($TSX) continues its bear market trend. You can use this link to get to the webinar. The Canadian Technician 20150915

The Canadian Dollar ($CDW) has some support near the current levels at 75 but way more support at 69 to 72.50. 

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Woot Woot! A Bi-Weekly Webinar Solely Focused On Canadian Stocks

Just a heads up that we are changing some of the information communication channels here at StockCharts. One of the things that is showing up in our work is the Canadian audience would like more Canadian specific information from the Canadian Technician.

To help focus our webinars on different types of markets and market analysis, I will be hosting a Canadian Technician webinar every second Tuesday starting at 5 PM EDT today. The opposite week will have Martin Pring doing his Market Roundup on Tuesdays at 5 PM. This will mean there is a new webinar series every Tuesday afternoon. 

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The Other Half Of The Full Monty On The Weeks Meltdown

For those who missed it, there is a part one to this article covered in the article linked here. The Full Monty On The Weeks Meltdown.

With the same chart style and the global review, I would like to continue to go around the globe and look at each chart on a monthly chart. Notice how important closes below the 20 month moving average (MMA) are, so I marked the low closes with arrows on the price chart. It is also very important when charts around the world break below this level as a group. RSI falling below 50 on monthly charts and staying below 60 is important as that typically marks a bear market. The monthly MACD with a negative slope is usually a big problem and a rising average true range is a big deal to me. Sometimes the narrowing of the Bollinger Bands can be a big clue. Arthur Hill and I have been writing about this and it is usually reflective of a change in trend but not always. The Bollinger Band pinch has been very notable on the weekly charts but I want to run with monthly here. Keep in mind that we still have a few trading days to rebound. These charts show the monthly close and the close below the 20 month MA (MMA) is what I want to focus on.

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The Full Monty On The Weeks Meltdown

Global stocks were dropping on the back of some weak Chinese news is the way the media portrayed the event. Is that what really happened? Definitely not. The market internals have been getting weaker for months as the RSI shows on the Dow. Commodity demand has been dropping if not plummeting globally which I believe illustrates the lack of global economic growth. The US Dollar ($USD) has gone sideways after last year's acceleration from July 2014 to January 2015. But commodities have continued to fall, even though the $USD is a lot weaker than January. The July earnings season was average to weak with everyone blaming the $USD. It takes a while for a strong dollar to show up in the financials. It also takes a while for the weakness in the energy sector to flow through and show up in other sectors. I think this energy sector weakness is one of the strongest global headwinds. 

Let's look at some of the charts and you can make your own opinion. I want to highlight some of the technical indicators that illustrates a slowing global scenario to me. Many of the world's largest companies are in the $SPX and it is usually the last to fail. Many of the blogs and webinars have been demonstrating the weakness underlying this market but the $SPX has been so resilient.

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What Are Canada's Top 5 Micro Stocks Right Now?

I like to use the SCTR ranking to see our top performers, both big and small.  A quick view of the list makes for an interesting perspective. A lot of the top performing Canadian stocks are Micro Caps. While Micro Cap investing is risky and these are not being recommended here, the price action is compelling and the variety of stories interesting.

Our top ranked stock is Theratechnologies from the Healthcare sector. It has traced a sideways move for a month but it has been an outstanding stock since March 1st when it first made the 52-week high list.

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Are North American Markets Ready To Turn Higher?

Canadians have been looking in disarray at the comparison between the Canadian Stock Market and the US Stock Market. On the US side of the border, the market has been going continuously higher for a couple of years, but has now been consolidating. On the Canadian side, the market has wiped out bulls and bears. If a Canadian investor follows (rotates to) the strong areas of the market, the Canadian investor would be ok. However, many investors invest in what they know. Car Industry investors have invested in Magna, whereas Western Canadian investors have been trying to buy a bottom in Oil & Gas stocks for years. While the price of Crude Oil only recently collapsed, Natural Gas investors have continued to be tempted by sudden price rises, only to have the price roll back over and accumulate more losses in the related stocks. When the Natural Gas price finally does break out, no one will believe it. US investors have been able to see the big outperformance with Biotechs and are probably tuned in to it as the US investors have a lot of large companies with liquidity and can move around more.

Canada's stock market leadership has moved around the country with the poisonous rebound of Blackberry in Waterloo, the 80% plunges in oil patch companies in Calgary to the current groundswell towards Laval Quebec with Valeant Pharmaceuticals (VRX.TO). However, for investors in the $TSX index after a few roller coasters, the buyers of the XIU.TO would only be down 2.3 % YTD.

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