Tech Talk: TimingTheMarket.ca July 6, 2015...Tech Talk for Monday, July 6, 2015 [Author’s note:...

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Tech Talk: TimingTheMarket.ca July 6, 2015

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Tech Talk for Monday, July 6, 2015 [Author’s note: next Tech Talk report will be on July 13]

Equity Trends (summary at end) The S&P 500 Index dropped 23.71 points (1.18%) last week. Intermediate trend changed to down from up on a move below support at 2072.14. The Index remains below its 20 and 50 day moving average. Short term momentum indicators are trending down.

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Percent of S&P 500 stocks trading above their 50 day moving average dropped last week to 35.00% from 45.40%. Percent remains in an intermediate downtrend. Historically, a recovery from below the 30% level has provided an intermediate buying opportunity. However, more data is required to confirm that the recovery late last week was real.

Percent of S&P 500 stocks trading above their 200 day moving average dropped last week to 53.60% from 59.60%. Percent remains intermediate overbought and trending down.

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Bullish Percent Index for S&P 500 stocks fell last week to 57.60% from 61.60% and remained below its 20 day moving average. The Index remains intermediate overbought and trending down.

Bullish Percent Index for TSX Composite stocks dropped last week to 59.68% from 64.11% and remained below its 20 day moving average. The Index remains intermediate overbought and trending down.




The TSX Composite Index dropped 125.70 points (0.85%) last week. Intermediate trend remains down (Score: 0.0). The Index remains below its 20 day moving average (Score: 0.0). Strength relative to the S&P 500 Index remains negative (Score: 0.0). Technical score remains at 0.0 out of 3.0. Short term momentum indicators are trending down.




Percent of TSX stocks trading above their 50 day moving average dropped last week to 27.16% from 31.45%. Percent continues to trend downward, but is intermediate oversold. Historically, a recovery from below 25% has provided an intermediate buying opportunity. However, data is not sufficient to make that call at present.

Percent of TSX stocks trading above their 200 day moving average dropped last week to 40.74% from 45.97%. Percent remains in an intermediate downtrend.




The Dow Jones Industrial Average fell 216.57 points (1.21%) last week. Intermediate trend changed to down from up on a move below 17,698.42. The Average remains below its 20 day moving average. Strength relative to the S&P 500 Index changed to neutral from negative. Technical score slipped to 0.5 from 1.0 out of 3.0. Short term momentum indicators continue to trend down.




Bullish Percent Index for Dow Jones Industrial Average stocks dropped last week to 63.33% from 70.00% and fell below its 20 day moving average. The Index remains intermediate overbought and trending down.

Bullish Percent Index for NASDAQ Composite stocks dropped last week to 58.36% from 60.85% and fell below its 20 day moving average. The Index remains intermediate overbought and has started to trend lower




The NASDAQ Composite Index dropped 71.29 points (1.41%) last week. Intermediate trend remains up. The Index remains below its 20 day moving average. Strength relative to the S&P 500 Index changed to neutral from positive. Technical score slipped to 1.5 from 2.0 out of 3.0. Short term momentum indicators continue to trend down.




The Russell 2000 Index dropped 25.77 points (2.02%) last week. Intermediate trend remains up. The Index moved below its 20 day moving average. Strength relative to the S&P 500 Index changed to negative from positive. Technical score dropped to 1.0 from 3.0 out of 3.0. Short term momentum indicators continue to trend down.




The Dow Jones Transportation Average fell 119.97 points (1.46%) last week. Intermediate trend remains down. The Average remains below its20 day moving average. Strength relative to the S&P 500 Index remains negative. Technical score remains at 0.0 out of 3.0. Short term momentum indicators continued to trend down.




The Australia All Ordinaries Composite Index slipped 8.10points (0.15%) last week. Intermediate trend remains down. The Index remained below its 20 day moving average. Strength relative to the S&P 500 Index turned positive from neutral. Technical score improved to 1.0 from 0.5 out of 3.0. Short term momentum indicators are trending up.




The Nikkei Average dropped 166.36 points (0.32%) last week. Intermediate trend remains up. The Average remains above its 20 day moving average. Strength relative to the S&P 500 Index remains positive. Technical score remains at 3.0 out of 3.0. Short term momentum indicators are mixed.




iShares Europe 350 units dropped $1.63 (3.58%) last week. Intermediate trend changed to down from up on a move below $44.10. Units fell below their 20 day moving average. Strength relative to the S&P 500 Index changed to negative from positive. Technical score dropped to 0.0 from 3.0 out of 3.0. Short term momentum indicators are trending down.




The Shanghai Composite Index dropped another 505.95 points (12.07%) last week. Intermediate trend changed to neutral from up on a move below 4,099.04. The Index remains below its 20 day moving average. Strength relative to the S&P 500 Index remains negative. Technical score slipped to 0.5 from 1.0 out of 3.0. Short term momentum indicators are trending down.




iShares Emerging Markets dropped $1.15b (2.88%) last week. Intermediate trend remains down. Units remain below their 20 day moving average. Strength relative to the S&P 500 Index improved to neutral from negative. Technical score improved to 0.5 from 0.0 out of 3.0. Short term momentum indicators are trending up.




Equity Markets: Daily Seasonal/Technical Equity Trends for July 3

Green: Increase from the previous day Red: Decrease from the previous day




Currencies The U.S. Dollar Index added 0.64 (0.67%) last week. Intermediate trend remains down. The Index remains above its 20 day moving average. Short term momentum indicators are trending up.




The Euro dropped 0.85 (0.74%) last week. Intermediate trend remains up. The Euro remains below its 20 day moving average. Short term momentum indicators are trending down.




The Canadian Dollar dropped US 1.46 cents (1.80%) last week. Trend changed to negative from neutral on a move below 79.59. The Canuck Buck moved below its 20 day moving average. Short term momentum indicators are trending down.




The Japanese Yen added 0.53 (0.66%) last week. Intermediate trend remains down. The Yen moved above its 20 day moving average. Short term momentum indicators are trending up.




Commodities (summary at end) The CRB Index slipped 0.33 points (0.15%) last week. Intermediate trend remains neutral. The Index remains above its 20 day moving average. Strength relative to the S&P 500 Index changed to positive from neutral. Technical score improved to 2.5 from 2.0 out of 3.0. Short term momentum indicators are mixed.




Gasoline added $0.01 per gallon (0.50%) last week. Intermediate trend remains up. Gas remains below its 20 day moving average. Strength relative to the S&P 500 Index remains neutral. Technical score remains at 1.5 out of 3.0. Short term momentum indicators are mixed.




Crude oil dropped $3.15 per barrel (5.28%) last week. Intermediate trend remains down. Crude remains below its 20 day moving average. Strength relative to the S&P 500 Index changed to negative from neutral. Technical score slipped to 0.0 from 0.5 out of 3.0. Short term momentum indicators are trending down.




Natural Gas added $0.06 per MBtu (2.17%) last week. Intermediate trend remains up. “Natty” moved above its 20 day moving average. Strength relative to the S&P 500 Index changed to positive from neutral. Technical score improved to 3.0 from 2.0 out of 3.0. Short term momentum indicators are mixed.




The S&P Energy Index dropped 11.04 points (1.98%) last week. Intermediate trend remains up. The Index remains below its 20 day moving average. Strength relative to the S&P 500 Index remains negative. Technical score remains at 1.0 out of 3.0. Short term momentum indicators are trending down.




The Philadelphia Oil Services Index dropped another 8.04 points (3.98%) last week. Intermediate trend remains neutral. The Index remains below its 20 day moving average. Strength relative to the S&P 500 Index remains negative. Technical score remains at 0.5 out of 3.0. Short term momentum indicators are trending down.




Gold dropped $8.50 per ounce (0.72%) last week. Intermediate trend changed to down from neutral on a move below $1162.10. Gold remains below its 20 day moving average. Strength relative to Gold changed to neutral from negative. Technical score remained at 0.5 out of 3.0.

Short term momentum indicators remain down.




Silver slipped $0.09 per ounce (0.57%) last week. Intermediate trend remains neutral. Silver remains below its 20 day moving average. Strength relative to the S&P 500 Index remains negative. Technical score remained at 0.5 out of 3.0. Short term momentum indicators are trending down. Strength relative to Gold remains negative.




The AMEX Gold Bug Index dropped another 3.35 points (2.20%) last week. Intermediate trend remains down. The Index remains below its 20 day moving average. Strength relative to the S&P 500 Index remains negative. Technical score remains at 0.0 out of 3.0. Short term momentum indicators are mixed.




Platinum added $3.80 per ounce (0.35%) last week. Trend remains down. PLAT remains below its 20 day moving average. Strength relative to S&P 500 and Gold turned positive.




Palladium gained $14.35 per ounce (2.11%) last week. Trend remains down. PALL remains below its 20 day moving average. Strength relative to the S&P 500 Index remains negative. Short term momentum indicators are trending up. Strength relative to Gold: Neutral.




Copper was unchanged last week. Intermediate trend remains neutral. Copper remains below its 20 day moving average. Strength relative to the S&P 500 Index improved to neutral from negative. Technical score improved to 1.0 from 0.5. Short term momentum indicators are trending up.




The TSX Metals & Mining Index plunged 27.83 points (4.00%) last week. Intermediate trend remains down. The Index remains below its 20 day moving average. Strength relative to the S&P 500 Index remains negative. Technical score remains at 0.0 out of 3.0. short term momentum indicators are trending down.




Lumber slipped 45.30 (1.82%) last week. Intermediate trend remains up. Lumber fell below its 20 day moving average. Strength relative to the S&P 500 Index changed to neutral from positive. Technical score slipped to 1.5 from 3.0 out of 3.0. Short term indicators: trending down.




The grain ETN jumped $2.43 (6.70%) last week. Intermediate trend remains up. Units remain above their 20 day moving average. Strength relative to the S&P 500 Index remains positive.




The Agriculture ETF added $0.03 (0.05%) last week. Intermediate trend remains up. Units moved above their 20 day moving average. Strength relative to the S&P 500 Index changed to positive from neutral. Technical score improved to 3.0 from 1.5 out of 3.0. Short term momentum indicators are trending up.




Commodities: Daily Seasonal/Technical Commodities Trends for July 3




Interest Rates The yield on 10 year Treasuries dropped 8.3 basis points (3.35%) last week. Intermediate trend remains up. Yield remains above its 20 day moving average. Short term momentum indicators are mixed.




Conversely, price of the long term Treasury ETF gained $0.77 (0.67%) last week. Intermediate trend remains down. Units remain below their 20 day moving average. Short term momentum indicators are mixed.




Industry Sectors: Daily Seasonal/Technical Sector Trends for July 3

Seasonal: Positive, Negative, or Neutral on a relative basis applying EquityClock.com charts Trend: Up, Down, or Neutral Strength relative to the S&P 500 Index: Positive, Negative, or Neutral Momentum based on the average of Stochastics, RSI, and MACD: Up, Down, or Mixed Twenty-Day Moving Average: Above, or Below Green: Upgrade from last week Red: Downgrade from last week




The Vix The VIX Index jumped 2.77 (19.76%) last week. Intermediate trend changed to up. The Index trades above its 20 day moving average. The Index has a history of moving higher from July to mid-October.

Other Issues Greece is the word! A yes vote is expected to have a slight positive impact on European and North American equity markets and a no vote is expected to have a substantial impact. Polls on Friday slightly favoured the yes vote. However, a yes vote also means resignation of the current government and significant political uncertainties

Iran negotiations also could influence equity markets.

Short and intermediate technical indicators for most equity markets and sectors are oversold but continue to trend down.

July historically has been a mildly encouraging month for North American equity markets.

Earnings reports to be released this week are not a influence on equity markets. Second quarter results start to pour in next week.




The U.S. equity market has a history of moving higher into mid-July during a pre-election U.S. Presidential year.

Earnings and sales by S&P 500 companies during the second and third quarters remain a concern. According to FactSet, consensus earnings estimates for the second quarter on a year-over-year are calling for a decline of 4.5% and consensus earnings estimates for the third quarter are calling for a 1.2% drop. Revenue estimates for the next two quarter are a decline of 4.5% in the second quarter and a drop of 2.6% in the third quarter. For the second quarter, 80 companies have issued negative guidance and 27 companies have issued positive guidance. Historically, the S&P 500 Index has moved higher during the first three weeks in July in anticipation of strong second quarter results. It probably won’t happen this year.

The Bottom Line The summer swoon in equity markets continues, led by concerns about international events (notably Greece, but also Iran and collapse of the Chinese equity market ). Recent weakness has returned most equity markets and sectors to intermediate oversold levels, but technical evidence of a bottom has yet to occur. Preferred equity strategy is to wait until volatility shows intermediate signs of peaking before using available cash to re-enter equity markets. Selected sectors such as fertilizer stocks and precious metals are top purchase candidates for seasonal trades after volatility peaks.



Special Free Services available through www.equityclock.com

Equityclock.com is offering free access to a data base showing seasonal studies on individual

stocks and sectors. The data base holds seasonality studies on over 1000 big and moderate

cap securities and indices. Notice that most of the seasonality charts have been updated

recently. To login, simply go to http://www.equityclock.com/charts/

Following is an example:

BW: Information on the Authors of Tech Talk follows on the next page.

http://www.equityclock.com/http://www.equityclock.com/charts/http://charts.equityclock.com/seasonal_charts/futures/FUTURE_SI1.PNG



About the Authors

Don Vialoux

Donald Vialoux, co-founder of Tech Talk, is a past president and director of the Canadian Society of Technical Analysts (CSTA). Mr. Vialoux has 45 years of experience in the investment industry, including prominent positions held at Richardson Greenshields and RBC Investments. He is the author of a daily letter on equity markets, which is available free at TimingTheMarket.ca. The Web site has recently received an average of 200,000 hits per day from 130 countries. Mr. Vialoux is also the author of a weekly column published at GlobeAndMail.com that combines technical, fundamental, and seasonality analysis. He is a frequent presenter on Business News Network (BNN) Television. Mr. Vialoux also offers advice to the Horizons Seasonal Rotation ETF (HAC). He holds the designation of Chartered Market Technician (CMT).

Jon Vialoux

Jon Vialoux, co-founder of Tech Talk, is a Research Analyst at Horizons Investment Management, Inc where he offers advice to the Horizons Seasonal Rotation ETF (HAC). He is the author and founder of EquityClock.com, which offers the largest source of seasonal profiles for investments on the Internet. Mr. Vialoux is also co-creator of the financial resource Web site, TimingTheMarket.ca, which offers technical, fundamental, and seasonal analysis of the markets. Jon’s market analysis and commentary has been published in the Financial Post, Globe and Mail, Toronto Star, and a number of electronic media sources, such as SeekingAlpha.com and GlobeInvestor.com. He is also a frequent presenter on Business News Network (BNN) Television. Previously, he provided analysis for State Street Global Advisors.

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Disclaimer: Comments and opinions offered in this report at www.timingthemarket.ca are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed. Don and Jon Vialoux are research analysts for Horizons Investment Management Inc. All of the views expressed herein are the personal views of the authors and are not necessarily the views of Horizons Investment Management Inc., although any of the recommendations found herein may be reflected in positions or transactions in the various client portfolios managed by Horizons Investment Management Inc. SEE: About the Authors, below. Security positions held or not held by Mr. Vialoux will be indicated at the end of each Tech Talk report. 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. All charts in Tech Talk come from StockCharts.com. Stock Charts can be accessed at no cost through www.stockcharts.com.
http://www.stockcharts.com/

Tech Talk: TimingTheMarket.ca July 6, 2015...Tech Talk for Monday, July 6, 2015 [Author’s note:...

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