The Canadian Technician

November 2011

The Canadian Technician

What a difference a day makes!

by Greg Schnell

Here is yesterdays blog with new data! Yesterday, we blogged about how everything was below the 10 week. Well, every sector except Tech is above the 10 week today. The USD is moving down and the commodity currencies of Australia and Canada are moving up above their 10 week lines. Here are the currencies. Keeping it simple. When everything is above the 10 week you want to be long. My market timing signal yesterday was still teetering as to whether the market would rise. Both Monday and Tuesday gave the Read More 

The Canadian Technician

$GOLD, GLD, GDX

by Greg Schnell

Using volume to help with your analysis is widely considered as the best tool in Technical Analysis. Today, let us compare three charts. I have marked the distribution days within the last month on the chart. A distribution day is a down day compared to yesterdays closing price, that has higher volume than the previous day. In other words, a distribution day is aggressive selling. Passive selling would be a down day, but people aren't selling aggressively so the volume is lower. 1 distribution day a week or less is ok. But clusters are a major negative! Read More 

The Canadian Technician

Sectors and Currencies

by Greg Schnell

Today,  Just a brief look at the different sectors. A quick scan says things are still weak. The Euro currency as well as the Yen were quiet today. The bond market has not confirmed the big move of yesterday. Here are the Canadian Sector charts. I recommend looking at the recent price action, trending up, flat or down. Secondly, watch the 10 week MA on the right hand side. Lastly, check if the price is currently above the 10 week. That is where price has to be to turn the MA up! Did you find any upsloping 10 week MA's? How about price above the 10 week MA? Read More 

The Canadian Technician

Where is the bottom?

by Greg Schnell

I use a variety of indicators grouped together to help me spot trend changes. The stockcharts website has some great indicators. How you use them is up to you. I'll try and show a few that I like. I have a list of 20 or so. Then I like to look the Bullish Percent indexes as well. Fortunately, when all the charts point to the floor, it definitely shows the trend. But the interesting time is when all the indicators reach extremes and would normally turn around. How to know when to close the trade, and when to hold. Arthur Hill posted his trend monitor in the blog this week. Mine is a Read More 

The Canadian Technician

Commodities -All of 'em!

by Greg Schnell

Here is the Energy dashboard. I like to look at two things. 1) Position relative to the 10 week. 2) Slope of the 10 week line - Up, Down, Sideways My arrow covers it a little bit, but it looks like a failed breakout on the $BRENT chart, and has now moved right through the 10 week to the downside. $WTIC looks better though. Heating oil and $WTIC both have slopes heading higher. $BRENT continues lower Here are the precious metals. Gold is just under the 10 week. You can see Silver and Platinum are below as well. The Read More 

The Canadian Technician

The US Bond market reaction to the Super Committee conclusion

by Greg Schnell

First of all, Happy Thanksgiving to all our american readers and friends. May this celebration find you happy and healthy. This also includes all the staff at Stockcharts.com who do a great job! +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ The US Bond market has befuddled the masses by continually pushing prices higher and the yields lower. Without reiterating all the reasons this is amazing, let us start with one. 1) France  credit spreads are blowing out and they still have a AAA Credit rating. The US debt has been downgraded by S&P but Read More 

The Canadian Technician

A look at the Canadian, US, European Banks

by Greg Schnell

We know they are weak.. what we are watching for is any signs of a bottoming process. Here is the Canadian Dashboard. Here are the US Banks Here are the Investment Banks Spanish,Dutch, German and Swiss Banks. The French and British Banks As of writing this morning, every bank is below its 10 week. Lots of the banks have taken out the September lows. Credit spreads continue to widen. We are still making lower highs and lower lows. That holds true for USB as well, which has the Read More 

The Canadian Technician

Tired of how low can you go, doing the limbo with Lumber..

by Greg Schnell

OK. I like to buy stocks with high growth ratesthese lumber stocks have had cement shoes on the profits for years. But this is why we need to pay attention. Here is the $LUMBER chart Weekly Inthe past 2 weeks It has gone from below the 10 week and 40 week to above them both. What makes that so remarkable is the downtrend the overall markets have been in. Is it a buy hereno..not when the markets are in a downdraft like a Canadian Thermometer in November. But, we need to put together a buy list if we were to buy a lumber stock. Here is the same data Read More 

The Canadian Technician

Lets zoom in on the $SPX, $COMPQ and the $TSX

by Greg Schnell

Here are 6 Pacific rim Markets. The blue vertical lines are the approximate options expiration weeks. Options expiration dates during earnings season (January, April, July, and October) are pretty pivotal. Notice how the markets ran up for one more week after OE. If you look at a daily chart, you'll notice the following Monday was a large downward candle. We have been making lower weekly highs and lower weekly lows since then.The little red lines on each price chart mark where the markets closed 6 weeks ago. Why 6 weeks ago? Just marking the week before OE. So since the earnings season Read More 

The Canadian Technician

The what to do about oil? love oil... come on in.

by Greg Schnell

Here were some of my comments in the blog two days ago. 6) We have hit the fib levels on the index and on crude. Gold made moves above the fib levels, but the gold stocks have not. 7) Gold and oil opened higher today but the TSX opened weak. That is a simple piece of news that has been going on for a few weeks now. ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ Below are my introductory remarks about crude at $100. My biggest concern was that oil stocks were not following oil higher. Read More 

The Canadian Technician

Put some SPURS on your sectors! Put some SPURS on your Stocks!

by Greg Schnell

Today we want to investigate which sectors are leading and following. The easiest way to do that is: a dashboard view. The Canadian Sectors outside of Energy, Finance, Gold and Materials are incredibly thin. Like 10 stocks in each sector, some with even less. I have listed some of the sectors below. So here are the sector charts.   This is interesting, but it doesn't tell us what is outperforming. If you use the charts above with the charts below, you have a better chance of outperforming. Now these charts below, they help us see what is Read More 

The Canadian Technician

We're talking Looney tunes...actually loonies and toonies.

by Greg Schnell

Is this a market of opportunity or a quiet market like a canoe on a still lake above water falls? I don't know but I'll share my observations. You'll have to decide. For all the non-canucks reading the blog today, maybe we better explain the title. Canada moved to a coin to replace the dollar bill. When they did, the coin came out with a bird called a 'Loon' on the back. Well it quickly became known as a 'Loonie'. In a desire to not carry so many Loonies, Canada came out with a two dollar coin with a bear on it's back. Many thought the nickname might be a Beary or Berry. Well, once Read More 

The Canadian Technician

Food Commodities - TIme to buy Ag?

by Greg Schnell

Good Day, Lets just briefly check the dashboards. All of the symbols for the charts are just farther out months on the futures. So each chart has the nearest month first, then progressing to the longer months.Usually a year out. Here is Corn. Trading below the 10 week. Soybeans - trading below the 10 week   Sugar - trading below 10 week Wheat - Trading below 10 week Goldman Sachs Commodity Index (GSCI) Agriculture trading below the 10 and 40 week. As an aside, anything purple on any Read More 

The Canadian Technician

There's something strange going on around here.. Crude Oil

by Greg Schnell

Well, that was a very interesting week in the oil and oil stocks market. First of all, let's review crude oil and where it is priced. In the blog a few weeks ago, we suggested a good upside target for oil would be arond $99. How did we come up with that? At the time oil was in the $93-$94 level. 1) The 61.8% fib level is shown in gray on the chart. It was $99 2) The top of the BB has moved up slightly this week to $101. A few weeks ago, it was close to the same level as the BB. Remember, you can read the actual values in the top left of the chart. So here we sit with a Read More 

The Canadian Technician

Gold - HOT button - let's go deeper..

by Greg Schnell

Living in the city where BRE-X was born, I have seen the stock soar, scored, scarred, scared and scuttled.  Therefore my enthusiasm for the metal is always muted. My broker sent out BRE-X shares for Christmas after they went bust. So my concern is always where is my exit. So I start with a healthy dose of not wanting to own gold but maybe I need to. Let's go see. So let's break the Gold trade down into parts. 1) $GOLD - gold (end of day) data only. 2) GLD - The ETF that tracks $GOLD intraday 3) GDX - The US version of the Gold Index 4) $BPGDM - The Bullish Percent Gold Read More 

The Canadian Technician

Only 5 Downsloping 200 DMA averages in 22 years. How to trade with it!

by Greg Schnell

Normally, I focus on the Canadian market, but today we need to explain what the dynamic currently in play is on the $SPX. Recently, my blog of November 1st tried to explain bull and bear market cycles using the RSI. RSI Bull Market Signals 1)In the article I explained how the market oscillates between intermediate term bull and bear markets. The RSI helps us spot those and stay in the trade. However, one of the most important market signals for managing your investing style is the slope of the 200 DMA. We need to understand how critical the market signals are once Read More 

The Canadian Technician

Which one is Which? What market are you trading?

by Greg Schnell

Below are four different markets. I have standardized the chart style to make the look similar. I have left the 50 and 200 DMA on the charts. I have erased the name, value or price of the stock, commodity, currency or index. Which one is which? What if I told you the first one is an Index, The second is a commodity, the third is a currency, and the fourth is an Index? The first one is the $HSI - The Hang Seng Index in China, The second one is $WTIC - West Texas Intermediate Crude, The third is the FXE -  euro ETF, and lastly Read More 

The Canadian Technician

Lets Review the Canadian Banks

by Greg Schnell

Here is the Bank Sector: I don't like the red candle that made new 4 week lows this week. Here is the daily. I am very surpirsed that the Canadian banks did not get a relief rally at all after the Monday / Tuesday drill down.  Maybe we tested the lows today and held. But with Wednesday, Thursday being so strong and no real rally on this chart, I am increasingly worried that the financial markets are sniffing more trouble. Lets do a quick look of the weekly and the daily for the Canadian 5 banks. BNS The 4 weeks with closes all Read More 

The Canadian Technician

A check of the dashboards

by Greg Schnell

Lets check the commodity dashboards: Here's $WTIC - Looks Bullish! Here's Copper: Testing support on every date.caution warranted: Corn: Testing resistancebuying opportunity with a tight stop? What I can't understand is why Potash is not getting a bid.   Here is potash so you can see what I mean..   Here's wheat: Doesn't look strong yet Soybeans: Sugar: The farther out months look Read More 

The Canadian Technician

Is this a new bull market or a continuing bear market? How will you know?

by Greg Schnell

This is a long but important blog. It clearly illustrates why this point in time is so important. What Point? How price behaves at this 200 DMA. How the 50 DMA reacts right now. What do we need to see to confirm the move higher. Introduction One of the major traits of a bear market is the whipsaw of emotions that one experiences when in a bear market. Gut wrenching drops with sizzling rallies. The market rallies on bad news, it rallies on good news, it falls on good news, it falls on bad news. It seems almost chaotic. Well here we stand with all of those emotions in play within a few Read More