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00:00:00Good morning, everyone, and welcome to Thursday morning.
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00:00:03It's Stephen Whiteside here from theuptrend.com.
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00:00:06In the premarket this morning, stock index futures are very quiet.
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00:00:10DOWfutures currently unchanged while the
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00:00:12Nasdaq is slightly higher in the premarket on Thursday morning.
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00:00:17Let's start off this morning's presentation doing a recap of the month of
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00:00:21May, and we can start off looking at the S&P 500.
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00:00:25Nothing new here.
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00:00:26All the big cap tech stocks were the winners for the month of May, and you can
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00:00:30see the majority of the S&P 500 actually closed lower for the month.
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00:00:35T hat's a problem we've been dealing with for a while now.
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00:00:38There's the DOW pulling back into the channel down 3.38 %.
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00:00:43S&p 500 closed up just under half a % and is back on a monthly buy signal.
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00:00:48Joining the Nasdaq, which was up nearly 8 % on the month.
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00:00:52Then looking at the Sox or the chip sector, which has been on a buy signal for
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00:00:56six months now, was up 14.3 % for the month.
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00:01:01Looking at the Canadian market, and this
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00:01:03chart isn't as helpful, this particular heat map is not based on the month of
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00:01:08May's trading, but the trading for the last 30 days.
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00:01:11You can see the tech stocks where the winners over here.
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00:01:15You can see that one bank actually
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00:01:17is positive, but that's based on 30 days for the month of May.
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00:01:21It was actually down on the month, so
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00:01:23not as much fun in the Canadian market, which was down.
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00:01:27The I shares for the TSX 60 were down
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00:01:305.32 % for the month, still on a monthly buy signal, so no change in trend there.
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00:01:36Now, we've been quite concerned about banks in the financial sector in 2023.
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00:01:41US Bank stocks were down just a tick under 7 % for the month.
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00:01:45Regional banks continue to move lower, down 8.65 %.
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00:01:49So they're not getting as much media
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00:01:51attention, but they're continuing to move lower.
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00:01:53Canadian financials were down 5.37 % while
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00:01:58Canadian banks were down 6.45 % for the month.
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00:02:02So in both cases, still on monthly sell signals.
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00:02:05Now, what worked well in the US on the S&P 500, it was NVIDIA, which was up 36.34 %.
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00:02:14What didn't work on the S&P 500 was Advanced Auto Parts.
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00:02:18It's been on a monthly sell signal for a while now, down
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00:02:2341.93 % and actually just right down at the lows from back in early 2020.
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00:02:30What worked in Canada?
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00:02:31Well, it's hard to notice on the chart, but we do have BlackBerry back on a
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00:02:35monthly buy signal up 38.07 % for the month.
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00:02:39The big loser, Canopy Growth, which was down 35.43 %.
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00:02:44The TSX is decommissioning the Canadian Cannabis Index.
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00:02:50You can still, of course, trade the ETFs.
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00:02:52You've got the Horizons Marijuana Life ETF, which was down 9.94 % for the month.
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00:02:57And then in the US, Alternative Harvest, which was down 9.34 % for the month.
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00:03:04Now, if you're following marijuana stocks
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00:03:06and you're still looking to play them on the long side, you really need to just
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00:03:12narrow your focus quite a bit in your expectations.
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00:03:16We should have found support at the $10
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00:03:19level, and we're now trading at $3.10. So that area of support has broken.
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00:03:25You need to just eliminate all this previous trading action.
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00:03:29This market is probably never going to come back into that range.
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00:03:32If we look at the weekly fly paper channel, you can see that we're coming
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00:03:36down to the $7 level, and that's really your trading range.
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00:03:41So if you're looking up in any of these charts, and if they do start to turn
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00:03:45around and you do start to get buy signals, the stuff over at the left is
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00:03:49just a dream that will never happen again for this particular sector.
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00:03:54The sector is probably just going to get
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00:03:56eaten up by drug companies, and you'll never have to worry about how the highs
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00:04:02from 2020, 2021, those will never come back into play.
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00:04:07Looking at gold, gold was down over
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00:04:10$35 for the month, still on a monthly buy signal, no change there.
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00:04:14Crude oil was down
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00:04:169.14 % for the month, still on a monthly sell signal, no change there.
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00:04:23Now, moving from monthly charts to daily
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00:04:25charts, of course, we're still waiting to see if the debt ceiling can get resolved.
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00:04:29In the news this morning, we've got Salesforce out with earnings.
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00:04:33Now, Salesforce is still on a buy signal here, making a new high yesterday.
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00:04:37Looking for a close on Thursday below
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00:04:39208.60. So far, we were trading down not as low as 208.
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00:04:4660. We're trading down to 21106.
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00:04:49Last time I checked, of course, that
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00:04:50number is going to be different when you check out Salesforce in the premarket.
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00:04:55Our next price target was 225.
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00:04:57We hit that yesterday.
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00:04:59So chitchat, ng, congratulations.
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00:05:00You got to lock in some profits at 225 before the pullback.
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00:05:05Now, I always like to look at the midterm
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00:05:07chart to see if there's any difference between the right side and the midterm.
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00:05:10Right now, they are very close together.
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00:05:13So we'll have to see how Salesforce makes out on Thursday.
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00:05:18Looking at the VIX, the VIX is still on a
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00:05:20buy signal that's supportive for lower stock prices.
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00:05:23If we get a close below 1728, that would open up the market to go higher from here.
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00:05:29Looking at the US dollar index, we made a new high for this move.
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00:05:33At the same time, bond prices moved up nicely again on Wednesday, giving us a buy
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00:05:38signal for the 30 year bond and a sell signal for bond yields.
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00:05:42Then looking at the price of gold, gold
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00:05:44moved up yesterday, looking for a close above
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00:05:48$2,002.90. That would give us a new buy signal on Thursday.
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00:05:53Gold stocks moved up on both sides of the
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00:05:56border, but not enough to give us a buy signal.
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00:05:58Then we saw crude oil move down yesterday, 1.88 % for the day and energy stocks also
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00:06:06moved down over 2 % on the TSX, 1.76 % on the S&P 500.
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00:06:12Then looking at the iS shares for the TSX 60, new low for this move on Wednesday.
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00:06:18Looking at the DAO, the DAO closed
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00:06:20slightly lower yesterday, still on a sell signal.
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00:06:23S&P 500 pulled back to the upper channel
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00:06:25line for the SPY, we're looking for a close below 413.92 on Thursday.
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00:06:31Then we've got the QQQ's still up in the
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00:06:33sky well away from any potential sell signal on Thursday.
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00:06:39Then looking at the chip sector, you can
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00:06:42see the big reversal that we had and we did make a new high.
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00:06:47We did run up and tag 212.50. So
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00:06:51if you had an order in up there, that got filled.
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00:06:53And of course, if we look back, you can
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00:06:55see we previously peaked back at the 212.50 level a few months ago.
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00:07:00Let's finish off today's presentation looking at a stock that came up
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00:07:04during a one on one tutorial on Wednesday, and that's Ambarella.
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00:07:09It collapsed yesterday but did not give us a sell signal.
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00:07:13So we're looking for a close below $70.57.
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00:07:18And you can see that it actually opened below that level yesterday and traded
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00:07:22below that but did not close below that level.
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00:07:25It closed at 72.32. So even though it was
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00:07:29a big down day, not enough to give us a sell signal.
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00:07:32Now, if we go back to when this trade started, and of course, it's the first
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00:07:36close above the upper channel line, gives you a buy signal.
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00:07:40And then we're looking for the first close
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00:07:41below the lower channel line to totally kick us out of a trade.
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00:07:46Now, while we're waiting to be kicked out,
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00:07:48we want to try to take some money off the table.
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00:07:5168.75 would have been far too close to use as a price target.
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00:07:57So then you look up $75 and 81.25, those would have been your next two targets.
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00:08:03That would be your playing field.
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00:08:05$75, is that a legitimate target?
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00:08:08Well, there's lots of support over here.
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00:08:10And so, yeah, that's a legitimate target.
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00:08:12So you would have put an order in to sell
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00:08:14half of your position at 75, then you would have put an order in to sell half
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00:08:19your position at 81.25. Any history at that level?
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00:08:22Yes.
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00:08:23So that's certainly a legitimate target to the upside.
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00:08:26And then, of course, you could have put
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00:08:29another order in up there at $87.50 once the $81.25 order was filled.
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00:08:35It doesn't look like we're going to get up to that level.
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00:08:37You did have a chance to lock in profits
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00:08:40at $75 and then $81.25. Now you're just sitting with a partial position looking to
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00:08:47see if the market will recover or if we do go down and close below the 70.
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00:08:5357 level.
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00:08:53That's the number we're looking for on Thursday.
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00:08:56And if we close below that level, then you
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00:08:58get to sell the remainder of your position after already locking in profits.
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00:09:05Okay, folks, that is all for this morning's presentation.
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00:09:07I see the futures have slipped a little
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00:09:09bit, but it's not going to get anybody overly excited.
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00:09:13Have a great day.
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00:09:14Next time you'll hear my voice is on Friday morning.
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00:09:16And on Friday morning, we're going to take
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00:09:18a closer look at the Canadian stock market.