The market continues to churn higher, continuously pushing away from breakout levels above September 2015 around 14000. The $TSX opened to new 2016 highs this morning even as oil has pulled back over the last two months.
This is the fifth article in a series about a 1700 Kilometre (over 1000 miles) road trip that I did two weeks ago. You can follow these links to the first four articles.
On my road trip through the mountains and into the grain growing region, a massive transition from mining and forestry into grain and livestock takes place. We also travelled through Jasper National Park. Caribou are not found as far south as Calgary, but this bull Caribou was just east of the Jasper townsite.
This is the fourth article in a series about a 1700 Kilometre (over 1000 miles) road trip that I did a week ago. You can follow these links to the first three articles.
Continuing with one of Canada's largest pipeline companies, TransCanada Pipelines (TRP.TO, TRP) has been rocketing higher. Here is a link to their latest investor presentation. They are primarily a Natural Gas transportation company.
The SCTR is holding nicely above 80 and has been really strong since the beginning of the years. We can see the price has soared to new highs and is currently 25% above the 40 WMA. I have shown an area on the left side marked with a red arrow that made a top on TRP.TO. Notice how the volume peaks matched the top and bottom of the stock range. What makes that worrisome is the third highest volume candle on the chart was last week. Perhaps it marks another top?
Getting a pipeline approved these days is a little more difficult than it used to be. In Canada, the debates about Keystone, TransMountain, and Energy East have all been a focal point for national divisiveness. In this article, I have no plan of entering into more debate. I do want to analyze what investors think about pipeline companies right now.
This is the third article in a series about a 1700 Kilometre (over 1000 miles) road trip that I did a week ago. You can follow these links to the first two articles.
This is the second article from my weekend road trip through the mountains between Alberta and BC. The first article can be found here. Canadian Transportation Companies Start My Highway Tour.
After leaving the Windermere area, we drove past many logging trucks. There are multiple lumber sawmills and pulp mills along the route. We drove past Canfor, Norbord, and Weyerhauser that you could see from the road. There were also other mills set back from the highway, so I didn't catch the company names. However, the purpose of this article is to get a current state of the different industries, so let me roll through all the Canadian Forestry charts.
Starting with Canfor Corporation (CFP.TO), we can yell "TIMBER-R-R". This chart has been falling for a while. The SCTR is low, the slope of the 40 WMA is down sloping significantly (just above the red line) and the MACD is very negative and it does not appear ready to start moving higher. There is one small positive and that would be the higher low on the MACD compared to the lower low on price in late June.
On the weekend, our family went on a long drive through some of the most beautiful places on earth. Starting near the headwaters of the Columbia River system in British Columbia, we wound through Lake Louise, turned north through the Icefields Parkway and headed to Jasper, AB. From there, we went on to Grande Cache and Grande Prairie outside the mountain ranges. We stayed at a farm for 2 days and then rolled through Fox Creek, Whitecourt, Mayerthorpe, Edmonton, Red Deer and ultimately parked in Calgary.
One of the most difficult decisions in investing is selling the gift that keeps on giving. Stocks that have performed well for a number of months or years start to feel bulletproof. I scrolled through the $TSX components and noticed a couple of long-term charts that have generated zero over the last year after being a major outperformer.
The first is Constellation Software (CSU.TO). The stock chart looks like a long, long love story. Earlier this year, the SCTR broke down below 75 and stayed there. The stock is ripe for a long term investor to make a decision.
Since Brexit, Silver has rallied significantly and Monday, July 4th is no exception.
Here is a chart of Silver Wheaton (SLW.TO). It has soared more than 30% since Brexit.
For those looking to the hot area of the market, the precious metals are on fire. Short-term traders will be loving this move. For long-term investors, it is very difficult to get a new position started after this ballistic move.
The commodities related trades have been on fire. The Commodities Countdown webinar 2016-06-30 looked across a broad spectrum of trading ideas related to commodities. I would encourage you to take a look at some other areas that might not have started moving ballistically.
One area of the market that I believe should be constantly monitored over the near-term is the global banking structure. I penned two articles on this after the Brexit results and I continue to think that Brexit might actually be a catalyst for some serious impairment in the banks. You can click on the charts in the following articles to keep updated on the global picture.
As we head into the second half of the year, the market is really working hard to maintain an upward trend. With 7 quarters of declining earnings, the fundamental picture almost seems irrelevant if the market can not reflect a major lag of this size. However, the technicals continue to define where to be positioned in this volatile sector rotation. Commodities started the year dismally, and have rallied for five months. Can this trend continue? It appears that the commodity rallies are broadening into other types of materials and investors should look a little wider as there appears to be some nice opportunities shaping up. We'll continue to share ideas on this blog and through the webinars. I would encourage you to add webinar viewing to your market information stream. StockCharts.com was recently awarded the Top Technical analysis Team for 2016 and we continue to try making the website one of the best spots on the internet for new idea dissemination.
Greg Schnell, CMT, MFTA
After a rough couple of days globally, the energy sector looks under attack. The oil producers, service companies, midstream companies and pipelines are all getting crushed in the carnage.
Some of the charts have had dramatic breakdowns. Some are already moving to two-month support levels and others have already broken down below support. The energy ETF for Canada is still holding an uptrend but just barely.
Well, if it wasn't a Black Friday, it was sure a grey Friday. Canada's Exchange ($TSX) was the least damaged on a global selloff. Friday's carnage amounted to 1.7% for the $TSX, but the US Markets sold off by 3-4% and some global markets were down by more than 10%. Italy ($MIB) was clocked falling 12.48%. The centre of the storm, England was down 3.15% but the daily candle was down 8% at one point. I find it interesting that the British market fared better than the American indexes.
Canada's $TSX has a large contingent of Gold mining stocks and they gapped up on the open and sold off a little over the course of the day. But this was a marginal ballast to an otherwise messy day globally.