Take Some Profits Now 10272023

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Good morning, everyone, and welcome to Friday morning.

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It's Stephen Whiteside here from TheUpTrend.co In the premarket this

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morning, stock index futures are above fair value.

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Commodities are mixed with crude or

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higher, while gold is lower in the premarket on Friday morning.

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Now, we do have some economic numbers coming out at 8:30.

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Don't think they'll be enough to really sway the market, but of course, getting

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over that 8:30 time period is always a little bit of a stumble.

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Now, in the premarket this morning, we've

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got Intel trading higher up into the channel.

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At the same time, we've got Ford trading lower back down to the recent low.

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Now, in both cases, we're not expecting a change in trend on Friday.

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Looking at the US market from Thursday's

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trading action, you can see it was rather defensive.

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The leader was real estate followed by

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utilities, of course, on the other side, the side that we watch a lot more closely,

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infotech and communication services were the big losers yesterday.

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Looking at the VIX, the VIX is still on a buy signal.

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That's negative for stocks.

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Little out of sync with the market right now.

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I think options traders are a little more bullish than stock traders right now.

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As we saw many of the major stock market indices make new lows yesterday.

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The VIX would need to close below 18.42 to give us a sell signal on Friday.

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That would certainly be short-term bullish.

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It would be more bullish if we started to break down below this uptrend line.

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Now, when we look at where the stock market is right now and what options

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traders are doing, look at how worried options traders were back in March when

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the VIX was trading all the way up there to 30.

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That is still a possibility.

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But right now options traders in Chicago

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not overly concerned about the market crashing at the moment.

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So just keep that in the back of your mind.

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That doesn't mean we're going to change direction right away.

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But options traders are not willing to

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overly hedge their positions at the moment.

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Now you've probably been hearing a lot of

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people talk about the 200-day moving average.

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And for a lot of investors, that's a big line in the sand.

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Most of the symbols in North America are

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currently trading below the 200-day moving average.

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When you look at the DOW, and it made a

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new low yesterday, you look at the S&P 500, it's broken down below the 200-day.

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It has also made a new low on Thursday.

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It's the Nasdaq that's still holding up,

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ran down to the 200-day moving average yesterday.

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When we look at the percentage of stocks in the major North American indices and

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look at the percentage of stocks currently trading above their 200-day moving

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average, you can see the Nasdaq 100 is still the big winner.

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Everybody else is down here in the 20s.

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The TSX-60 is down below 20, but it is the Nasdaq that is still the holdout.

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And so if those stocks continue to move

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lower, there could be a stock market crash.

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Now, yesterday we talked about the

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Magnificent Seven stocks, and most of them are still holding up fairly well.

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Alphabet drove down to the 200-day moving average while Amazon broke down below it.

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And remember what was originally

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potentially support could act as resistance on the way back up.

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Now Amazon is joining Apple and Tesla

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already below their 200-day moving averages.

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Now, Microsoft was the big loser of the Magnificent Seven yesterday, down

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3.75% right back down to the lower channel line.

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It is trading higher in the premarket this morning.

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Now, yesterday, we talked about the fact

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that we did pop and ran right up to our next price target and stopped on a dime.

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Then yesterday, we ran right back down to our price target of 328.13, we actually

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closed at 327.89, so just below that level.

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But we are trading slightly higher in the premarket this morning.

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Now looking at Microsoft, you can see the pros still have not taken control, unlike

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Tesla, where the pros gave up control right at the start of March.

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Now looking at some other 200-day moving

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averages, whether you're looking at semiconductor, the Russell 2000, the

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microcap stocks, everybody has broken down a long time ago.

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It's still the same pattern.

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It's the same theme. It's the same story.

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It's the same movie, lower highs, lower lows.

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Even when you look at the Nasdaq, the Nasdaq just put in a lower low.

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Now, a lot of symbols that you look at right now look like this where you can see

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that the Pressure Zone at the bottom of the screen has elongated.

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That means that, hey, we were looking for a new trend, uptrend to start.

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It did, but didn't last very long.

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We're looking for another new uptrend to start.

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It did, but didn't last very long. Here we are.

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This is telling you the stock is broken.

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Of course, where are we?

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We're right down at the bottom of the Panic Zones.

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A Pressure Zone has formed.

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We are seeing panic selling at the moment.

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That's the time and place where retail investors usually give up the ghost.

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In fact, a lot of retail investors will decide to short down here.

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You look at the transport ETF, the time to short was off the top of the Panic Zones,

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where we had early warning signals and the trends started to change.

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This was the time that you short.

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You don't short down here.

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This is the riskiest time ever to short.

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This is the time that retail investors get

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enough confidence because now they have enough negative feedback all the way down.

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They're getting pounded. They're getting pounded.

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Finally, they throw in the towel.

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And this is the time and place where markets often reverse higher.

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Now, I want to talk about locking in profits.

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If you have not systematically been taking money off the table this week as you've

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hit your profit targets, you should strongly think about doing it on Friday.

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Now, don't completely liquidate a position.

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We are coming up to monthend.

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There's a full moon on the weekend.

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That's usually the time and place where markets might want to change direction.

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There's no guarantee.

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I don't have a crystal ball.

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The market still could crash, who knows?

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But you need to be systematic.

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This is a business.

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You need to run it like a business.

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I'm talking to the people that haven't taken any money off the table this week.

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If, for example, you locked in profits on Microsoft, that's great.

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You don't have to do anything more than that.

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You're waiting to get kicked out of the position.

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But if you haven't

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taken money off the table this week, this is the time and place to do it.

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Now, if you're short the 3X bulls or any

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of the 2X or 3X index ETFs, take some money off the table.

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If you're long the bear ETFs,

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yes, the bulls could continue to go lower, the bears could continue to go higher.

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But you want to take some money off the

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table because this is the time and place where markets can quickly reverse.

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Now, if we can make it all the way into

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November, which is next week, and we don't crash, that'll take a lot of pressure off

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a lot of investors who are very concerned about an October stock market crash.

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Remember, the Sell in May crowd comes back in November.

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If we can make it through October without

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a major crash, that could turn a lot of people bullish on the market and willing

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to jump in to get ready for that year-end rally.

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Looking at the TSX, you can see similar situation.

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Utilities were the big winners.

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That's not going to be very helpful.

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The fact utilities went up yesterday is really not going to change very much.

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Then again, it was the infotech stocks

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that were the real drag on the Canadian market on Thursday.

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Now, the TSX is down at the bottom of the Panic Zones.

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You can see we were there a couple of weeks ago.

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We moved up to resistance.

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Remember, what was previous support on the

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way down will act as resistance on the way back up.

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That's exactly what happened.

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So here we are down at the bottom of the Panic Zones.

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Another Pressure Zone is starting to form.

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It hasn't formed just yet, but here we are.

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The pros: no interest in taking control on Friday.

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You can see we're well below the 200-day moving average.

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So any expectation when the market starts

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to move back up has to go up to where those moving averages are and no further

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because it's going to take a lot to turn the market around and get it to go higher,

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but it's going to take a lot more to get it up over resistance.

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Now, what's holding the market up right now?

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Well, gold stocks are certainly playing their part.

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You can see the early warning signal up there at the top of the screen.

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We are projecting higher prices right now, but we were not able to get up to 1797.

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We had a couple of bullish reversal signals.

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When you see those, the first thing you need to do is look for the exit.

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You don't have to pull the ripcord and

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jump, but just you've got to get mentally prepared.

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That's not the time and place to add to a

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position, that's the time and place to look to pair back a position.

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And on Friday, if you're trading the

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iShare's Global Gold ETF, we're looking for a close on Friday below 17.09. Gold is

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down five bucks in the premarket this morning.

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That could actually happen.

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Now, oil stocks have certainly played their part in holding the TSX up.

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Again, you can see the early warning signal up there at the top of the screen.

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We've started to pull back.

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We're on our third day of a cell signal.

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Now, the 50-day moving average is currently acting as support.

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You can see a couple of weeks ago, we came

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down to the 100-day moving average and found support.

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The energy stocks still have the

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opportunity to find support at these moving averages, where for everybody else

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in North America, those moving averages are acting as resistance.

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Now, Infotech, of course, big loser on the TSX yesterday, not only was it the biggest

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loser, but it also broke down below the previous lows.

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So not really a good sign.

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You can see we've broken down below the

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200 day moving average, just like many of the other North American indices have.

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And there's the right side chart for the TSX Infotech index.

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Looking at the biggest loser on

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Infotech from Thursday's trading action was Celestica.

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And then, of course, all the regulars are on cell signals, whether you're looking at

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BlackBerry, Dye & Durham, Lightspeed, Opentext, Shopify.

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Now Shopify is interesting.

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We're trying to hold the 200-day moving average that was acting as an area of

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really a sticky area for the past few weeks, but we finally broke down.

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There was an open gap there, and the

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bottom of that open gap over on the left was at 65.15. We closed at 64.53

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yesterday, so we certainly filled that gap and then continued lower.

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That gap is no longer in play.

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Our next mathematical price target is

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62.50. If that breaks, then we're heading down to 56.25.

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Let's finish off with the commodities and crude oil is on a sell signal right now.

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It's trading higher in the premarket.

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It was down 2.18 yesterday.

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It's up a 1.50 last time I checked.

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If we take out the October low, then

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there's some support there at 78.13. That would certainly be a big tell if we went

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down past that level because we recently put in a what do you know, a lower high.

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Then looking at natural gas, natural gas moved up to the upper channel line

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yesterday, so any higher close on Friday would give us a buy signal.

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There's an open gap just above us.

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But you can see the pros never gave up control.

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Even though we had this pullback and sell signal, the pros didn't give up control.

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They're probably anticipating cold weather.

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Maybe that's why they held in.

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3.71 was our price target.

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We closed at 3.70 yesterday.

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Look two lines up.

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That's your playing field up to 4.10. If

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we can take out 4.10, then 4.30, is that a realistic target?

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Well, we looked to the left and we popped up to that level back in August.

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So if we get a buy signal here, those are your next price targets.

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Now, the price of copper isn't doing anything right now.

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What are the pros doing? Well, they're not doing much.

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It does not look like they want to buy at the same time, I don't think they're

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too overly excited to be sellers at the present time.

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I guess they're waiting for more global economic news before they do anything.

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On the other hand, gold shot higher.

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Pros took control and ran it back up to $2,000.

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So far, we've been unable to break out above $2,000.

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At the same time, Silver Traders not as excited trading down to the lower channel

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line yesterday, so a close below $22.58 on Friday would give us a sell signal.

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The pros are in control, but $23.43 has

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been acting as resistance and holding silver in check.

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Okay, folks, that is all for this morning's presentation.

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Again, if you haven't been systematically

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taking money off the table this week and locking in profits, you probably want to

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do so on Friday ahead of the full moon and ahead of month end.

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Enjoy the rest of Friday.

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Have a great weekend, and the next time you'll hear my voice is on Monday morning.

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