Stock Market Timing Television - 04262023
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00:00:00Good morning everyone. Welcome to Wednesday morning.
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00:00:02It's Stephen Whiteside here from the uptrend.com in the pre market this
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00:00:07morning, stock index futures are above fair value.
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00:00:09So so far it looks like we're gonna see a little buying at the Open on Wednesday
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00:00:14morning and most of that buying is going to be in the tech sector.
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00:00:17Now Tuesday finally gave us a buy signal for the VIX and sell signals for all the
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00:00:22major indices including the S&P 500, the Nasdaq 100 and the TSX 60.
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00:00:29Now what worked and what didn't work on Tuesday?
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00:00:32Well looking at the major sectors you can see on the TSX there was only one winner
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00:00:36and that was utilities up a little over a quarter of a percent.
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00:00:40While energy stocks were the biggest losers in the US market, there were no
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00:00:44winners and materials were the biggest losers on Tuesday.
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00:00:48Now there's lots of stocks in the news this morning, a lot of earnings out for
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00:00:52companies that we follow on a regular basis.
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00:00:55There's one that I want to talk about and that's Activision.
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00:00:58It was supposed to be taken over by
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00:01:00Microsoft and it doesn't look like that's going to happen.
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00:01:04The UK regulatory body has said no.
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00:01:07And so now Activision is down about 10% in the pre market.
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00:01:12Now if you go back in time, the deal
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00:01:15started way back here back at the start of 2022.
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00:01:20If I had owned this stock back then, I would have taken the money and run.
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00:01:24Now I actually took Activision out of the
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00:01:27database for the longest time and put it back recently.
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00:01:31I am not going to sit around and wait for a better offer.
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00:01:34I'm not going to sit around and wait for
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00:01:37somebody else to put an offer on the table.
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00:01:39That usually doesn't happen.
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00:01:41And what often happens is what's happening right now is deals don't go through.
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00:01:46So I'm not going to sit for over a year
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00:01:49with my money in Activision waiting to see if there's a better deal on the table.
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00:01:53And as you can see we were recently trading back up to the high we saw back at
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00:01:58the start of all this and so now we're trading down this morning.
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00:02:01So this would have been dead money this whole time.
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00:02:04You would have had no mathematical
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00:02:06advantage to holding this stock for all this period of time.
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00:02:10There are lots of other things to do with
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00:02:11your money than just sit and hold and wait for the deal to finally go through.
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00:02:16Now Microsoft, which was down yesterday, it's been down the last couple of days, is
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00:02:21trading higher in the pre market and that's one of the reasons that Nasdaq
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00:02:24futures contract is trading up this morning.
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00:02:27So it looks like Microsoft may end the day on a buy signal.
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00:02:31Of course we'll have to wait for the end of the day to see how things settle down.
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00:02:36Now there was a lot of volatility on Tuesday you saw the VIX was higher, you
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00:02:40saw the major indices are all back on sell signals.
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00:02:43We had a spike in the US dollar index.
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00:02:45It's not back on a buy signal just yet,
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00:02:48but you can see that money went back into the bond market.
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00:02:51There's the 30 year bond back on a buy signal.
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00:02:54Bond yields were down sharply yesterday,
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00:02:56so you can see money moving around outside of the stock market.
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00:03:01Now, gold was up yesterday, it ended the
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00:03:03day just above $2,000, so that's a good sign.
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00:03:07Silver was down yesterday, it's back on a sell signal.
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00:03:10As of Tuesday's close.
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00:03:12Gold miners were up yesterday.
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00:03:14The GDX was up to the lower channel line.
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00:03:17We saw some more strength in the Canadian
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00:03:19market where we traded up into the Channel.
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00:03:21So for the XGD.TO, we're looking for a close on Wednesday above $20.35.
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00:03:29Now, speaking of miners, we saw a big sell
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00:03:32off in copper yesterday, so that's not a good sign for the global economy.
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00:03:37Crude oil was down yesterday.
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00:03:39Natural gas was down, not enough to give us a new sell signal.
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00:03:42And so there's the energy stocks in the US, they were down.
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00:03:47This particular ETF was down 1.88%, while in Canada we were down 1.94%.
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00:03:56Now, financials were down across the board
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00:03:58on Tuesday, we've got the XLF back on a sell signal.
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00:04:02That has a lot to do with First Republic.
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00:04:05Remember, First Republic is one of those regional banks.
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00:04:08It was the big winner on Monday, up 20%, and on Tuesday it was down nearly 50%.
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00:04:15It's down again in the pre market.
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00:04:17We closed at 8.10 yesterday, it's down around $7.
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00:04:20Nobody watching these videos should be involved in any regional bank.
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00:04:25They're one breath away from zero and you never want to have your money in anything
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00:04:31that's one breath away from being valued at zero.
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00:04:35It's just not worth the risk.
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00:04:36Yeah, you could have been up 20% on Monday, then you're down 50% on Tuesday,
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00:04:41you're going to be down another 30% on Wednesday.
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00:04:44It's just not worth it.
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00:04:46And it's very hard to short these stocks.
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00:04:48It's hard to find for your broker to find shares to short at this particular point.
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00:04:54We always talk about shorting off the top
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00:04:56of the panic zones and we're very far away from the top of the panic zones.
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00:05:01So we've got US banks back on a sell signal.
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00:05:04You can compare the financial ETF to banks themselves.
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00:05:08The banks got back on a buy signal and now we're back on a sell signal.
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00:05:11No upward momentum.
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00:05:13And that, of course, is certainly true for the regional banks.
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00:05:16Then looking at broker dealers, we're back on a sell signal.
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00:05:19US insurance companies back on a sell signal as of Tuesday's close.
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00:05:24Now, looking at Canadian financials, they're also back on a sell signal.
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00:05:27Canadian banks also back on a sell signal.
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00:05:30We're being led lower by the CIBC.
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00:05:33Second day of a sell signal there.
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00:05:34And the TD bank is finally back on a sell signal.
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00:05:37So if you've been waiting to short the TD bank, this is your opportunity.
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00:05:42You can short it on Wednesday morning if you want.
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00:05:46And then, of course, you would cover that
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00:05:47short if we closed above 82 65 on Wednesday.
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00:05:52Let's finish off this morning's presentation with a couple of comments.
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00:05:56We've been pounding the recession
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00:05:59drum for quite a while, and that hasn't stopped the major indices from moving up.
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00:06:06We've had a nice rally since the low in March.
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00:06:09A couple of comments here.
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00:06:11You can look back and see where we peaked back at the start of the year, and we just
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00:06:16put in a lower high, which is a bearish sign, of course.
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00:06:20Now, we've often mentioned the fact that this rally has been led higher by a
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00:06:26handful of big cap stocks, and the rest of the market has not really participated.
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00:06:32And so when we talk about the rest of the market, we could talk about the Russell
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00:06:362000 or we could talk about those micro cap stocks.
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00:06:40Neither really participated in this rally.
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00:06:43Yes, they got off the floor, but they really didn't get very far.
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00:06:49And so that is the overall market and that's kind of a bearish sign.
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00:06:53So now what we're going to be looking for,
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00:06:55does the Russell 2000, do the micro cap stocks, do they hold the low from March,
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00:07:00or do they start to break the low from March?
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00:07:03That'll be the next thing that we're looking for.
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00:07:05Now in the pre market this morning, stock index futures are higher.
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00:07:08They're being led higher by a handful of tech stocks.
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00:07:11And we'll have to see how that holds up throughout the day.
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00:07:14And of course, we'll be looking to see how the market closes to see what we do next.
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00:07:20Okay, folks, thank you very much for your time and attention.
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00:07:22Have a great day.
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00:07:23Next time you'll hear my voice is on Thursday morning.