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00:00:01Good morning, everyone. Welcome to Thursday morning.
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00:00:03It's Stephen Whiteside here from the
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00:00:05uptrend.com in the Premarket this morning, things are fairly mixed.
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00:00:09We've got Dow futures higher, while the S&P 500 and Nasdaq are trading lower.
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00:00:15Commodities are also mixed, with gold
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00:00:17slightly lower, while natural gas and crude oil are slightly higher.
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00:00:21On Thursday morning,
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00:00:23let's start off looking at the VIX and the VIX that traded in the channel yesterday.
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00:00:28We need to close below $20.36 to give us a sell signal on Thursday.
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00:00:34The US dollar index pulled back into the channel on Wednesday.
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00:00:38No change in trend there.
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00:00:40The 30 year bond made a new low yesterday.
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00:00:42We also saw selling in emerging market and
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00:00:45junk bonds, and we saw upward pressure on yields.
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00:00:4930 year yield moved up slightly, while the five year yield moved up more
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00:00:54aggressively, making a new high for this move.
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00:00:57So again, it's shorter term rates over
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00:01:00longer term rates, which is negative for the stock market.
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00:01:04Now, gold moved up yesterday looking for a close above 1852.
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00:01:1090 on Thursday to give us a buy signal for the price of gold.
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00:01:14Silver moved up, but just to the lower channel line.
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00:01:18Looking at the S&P 500, it was down yesterday, made a new low for this move.
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00:01:22The Nasdaq getting pretty close to making a new low.
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00:01:26Both of them are down in the pre market
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00:01:28and both of them are down in the pre market, probably because of Tesla.
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00:01:32Now, Tesla needs to close below 196.
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00:01:3573 on Thursday to give us a sell signal.
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00:01:37We are trading below that level in the pre
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00:01:40market this morning, looking for support at the 187.
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00:01:4450 level. So because of the size of Tesla and the
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00:01:48fact that it's not in the Dow, it's in the Nasdaq 100 and the SP 500, it is putting
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00:01:54downward pressure on those two indices, but not the Dow.
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00:01:58Now, another stock that's down in the
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00:01:59Premarket this morning is Silver Lake Capital.
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00:02:03Looking across the bottom of the screen,
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00:02:04you know this is dead money and it's not something that you should ever go near.
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00:02:09You can see that at the top left hand
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00:02:11corner of the screen, the stock was trading at $110.
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00:02:14It's currently trading just above $9 at the moment.
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00:02:18So no change in trend for that stock, but
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00:02:20it is down sharply in the pre market this morning.
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00:02:24Now, another stock that people are talking about this morning is snowflake.
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00:02:28And snowflake is down over $10.
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00:02:31And that should take us down to make a new low for this move.
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00:02:35Certainly no change in trend for snowflake.
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00:02:39Now, looking at the Dow, it made a new low yesterday.
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00:02:41It is up in the Premarket this morning
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00:02:43because of one stock, and that is salesforce.
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00:02:46Salesforce ended yesterday on a buy signal, but this morning it is popping and
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00:02:51it is trading above our projected trading range.
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00:02:54That's a huge move up for any stock.
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00:02:57Obviously, you're going to see some short covering at the open, which is going to
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00:03:01take the stock up and we'll have to see what happens next.
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00:03:06I would certainly not want to jump in to salesforce at these numbers.
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00:03:11I would fade this trade as I recommended you fade Nvidia last week.
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00:03:16And Nvidia has not been able to make a
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00:03:19move above that high from when the stock gapped higher.
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00:03:23So Salesforce is going to pop.
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00:03:26It's, helping the Dow outpace the Nasdaq and the SP 500 in the pre market this
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00:03:31morning, but it's not something I would chase.
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00:03:34Let's finish off today's presentation
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00:03:36looking at the Canadian stock market and we'll break this up into three parts.
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00:03:41The first part is the TSX itself is still on a sell signal.
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00:03:45The Ishares for the TSX 60 were up $0.05
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00:03:48yesterday in the premarket this morning, the TSX 60 futures are trading lower.
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00:03:54The ishares Canada ETF in New York is also trading lower.
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00:03:59So not expecting any fall through to the upside on Thursday.
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00:04:03Now, Wednesday's market action was all about commodity stocks.
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00:04:06And we saw base metals scream higher
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00:04:09yesterday, right back up to the high from a couple of weeks ago.
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00:04:12We saw money go back into mining stocks,
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00:04:15into gold stocks, and into the energy sector.
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00:04:19Now, there are a lot of buy signals in the
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00:04:22commodityrelated stocks from Wednesday's trading action.
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00:04:26I would strongly encourage you to be very
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00:04:29conservative, very restrained in your purchases at the present time.
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00:04:35Previously, we looked at the seasonality
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00:04:37chart for the VIX, and the VIX tends to spike during the month of March.
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00:04:42The Canadian market goes in the opposite direction.
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00:04:45Historically, you can see here, this is where we are right now.
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00:04:49And from this point on, we see some selling in the month of March.
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00:04:53That's what the seasonalities tell us.
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00:04:55Absolutely no guarantee that's what's going to happen this year.
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00:04:58But the fact that you know that should cause you to be a lot more restrained
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00:05:03until we see a major bottom in the Canadian stock market.
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00:05:07Now, typically what happens is we get a
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00:05:09nice up move in February, which coincides with RRSP season, and then
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00:05:15seasonally after that happens, they don't have any money left to buy
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00:05:20stocks in the month of March, and we get a pullback.
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00:05:22It doesn't happen exactly that way every year.
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00:05:25It hasn't happened exactly that way this year, but that's the seasonal tendency.
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00:05:31So don't be overly aggressive with these
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00:05:33new buy signals because they may not last very long.
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00:05:37We're still looking for crude oil to participate.
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00:05:40It's still treading water here in the channel.
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00:05:43Natural gas, on the other hand, has
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00:05:45started a new uptrend and let's hope it can continue to move higher from here.
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00:05:50Now, the banking sector is really holding the Canadian market back.
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00:05:54The Royal Bank rolled over yesterday, so
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00:05:57on Tuesday, ahead of earnings, we had a buy signal.
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00:06:01Then you come in on Wednesday morning and see what the market is doing, what's
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00:06:06happening in the premarket, and you don't take that buy signal.
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00:06:09You either sit on your short position or
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00:06:11just sit in cash and wait for the next opportunity.
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00:06:15Now what happened yesterday in the Royal
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00:06:18Bank isn't happening today for the TD Bank.
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00:06:21Looking at how it's trading in New York,
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00:06:23last time I checked it was up $0.70, which is a dollar in Canadian currency.
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00:06:28And so we're heading up into the channel at the open on Thursday morning.
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00:06:33Who knows how the day is going to end?
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00:06:35It could end like the bank of Nova Scotia did the other day.
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00:06:39And the Bank of Nova Scotia made a new low
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00:06:41yesterday before recovering going into the close.
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00:06:44The first sign something new is going on that's going on here is if we start
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00:06:48closing above the top of the big down day or back into the open
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00:06:53gap, that would be the first sign something new is happening.
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00:06:57We certainly don't have that type of information on Thursday morning, so no
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00:07:02reason to get excited about the bank of Nova Scotia just yet.
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00:07:06Okay, folks, that is all for this morning's presentation.
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00:07:10Have a great day.
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00:07:10Next time you'll hear my voice is on Friday morning.