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Tech Talk for Thursday November 10th 2016

 

Observations

Two major surprises within 24 hours: Trump was elected President and U.S. equity markets moved higher. Major U.S. equity markets (notably the Dow Jones Industrial Average) are testing previous highs. Financials, Industrials and Metals & Mining led the advance.

 

StockTwits Released Yesterday @EquityClock

JOLTS providing a mixed picture of the state of employment in the U.S.

Caterpillar $CAT moved above $89.08 extending intermediate uptrend.

‘Tis the season for Caterpillar $CAT to move higher to early January!

Technical action by S&P 500 stocks to 10:00: Surprisingly bullish. 12 stocks broke down (Consumer Discretionary). 25 stocks broke up (Financials, Industrials).

Editor’s Note: After 10:00 AM EST, another 15 S&P 500 stocks broke resistance.

Industrial SPDRs $XLI moved above $58.62 and $59.02 extending intermediate uptrend.

‘Tis the season for strength in the Industrial sector to early January! $XLI

Wide variety of Biotech and drug stocks broke resistance: $BIIB, $CELG, $GILD, $JNJ, $MRK

Aerospace & Defense stocks and ETFs breaking resistance: $LMT, $RTN, $PPA, $ITA

‘Tis the season for Aerospace & Defense stocks and ETFs to move higher to early January! $LMT, $RTN, $PPA, $ITA

Metals and Mining stocks and ETFs breaking resistance: $XME, $HBM.CA

‘Tis the season for strength in the Metals & Mining sector to early January $XME, $HBM.CA

Interfor $IFP.CA and other Cdn. wook stocks under pressure prior to softwood lumber negotiations.

Agrium $AGU.CA moved above #127.61 extending an intermediate uptrend. ‘Tis the season for strength!

TSX Financials ETF $XFN.CA moved above $32.85 to all-time high extending intermediate uptrend.

Dow Jones Industrial Average SPDRs $DIA moved above $185.67 to all-time high extending intermediate uptrend.

 

Trader’s Corner

Daily Seasonal/Technical Equity Trends for November 9th 2016

Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for November 9th 2016

Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Sector Trends for November 9th 2016

Green: Increase from previous day

Red: Decrease from previous day

 

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Adrienne Toghraie’s “Trader’s Coach” Column

Editor’s Note: Wow, talk about volatility! The last 24 hours was epic with a swing in the Dow Jones Industrial Average by over 1,000 points. Let’s hear from Adrienne on “Volatilty in equity markets”

Avoiding the Volatility Trap

So, we are in a highly volatile market. Great! Traders can wait a decade or more to see so much volatility in the marketplace. This is the time to make money, a lot of money. But the level of risk is very high. At no other time do the twin demons, greed and fear, wreck so much havoc on a trader’s emotional stability. Since trading is a zero sum game, if some traders are going to make a lot of money, others will have to lose a lot.

On which side of the aisle will you be sitting when the commotion dies down?

If you are to avoid the volatility trap, here are three guiding principles to remember as you gird yourself up for battle each morning in this market?

1. Stay disciplined

Follow your trading rules – until they no longer make sense. You spent a lot of time and money developing and testing your system. If you do not have any faith in it, now may not be the time to throw caution to the winds and jump ship to a new and untried system. That being said, you may find that your system is not designed to work well in a time of such high-volatility. And of course, watch your money management.

2. Stay flexible

Rigid adherence to a goal or a set of guidelines or way of looking at things works well when times are stable. But, when all the stops are pulled out in the market, it is important to stay flexible in order to avoid going down with the ship. When Mt. St. Helens erupted in 1980, pyroclastic surges (the turbulent clouds of hot gas and rock fragments) traveled up to 200 miles an hour. A minute after the blast, a fleeing driver of a car who had his foot to the floor passed a car going the speed limit. The first driver escaped the pyroclastic cloud. The second driver, rigidly adhering to the old rules in a volatile situation, perished.

3. Stay focused

Keep your eye on the ball when you are in the game. This is the time to be in training to be in the best physical and mental condition of your professional career. So, take excellent care of yourself. Get a lot of exercise and sleep. Eat well and stay away from excesses. After the market cools down will be time enough to indulge yourself or lick your wounds. If you are focused, you will not abandon your good sense, your inner disciplines, or your goals. You will see opportunities more clearly and you will have the mental toughness to take advantage of them.

One last caution – get away from the markets every day for long enough to completely forget what is happening. Go to a ball game, see a great movie, play golf with friends, take a walk in nature. Getting away from the markets each day will help you to keep perspective. It will help you to keep your stress levels manageable and it will also help you to keep those twin demons, greed and fear, in their cave behind bars, where they belong.

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S&P 500 Momentum Barometer

The Barometer gained another 3.20 t96.27%) last week. It remains intermediate neutral and trending higher.

 

TSX Momentum Barometer

The Barometer gained 6.28 (17.24%) to 42.68 yesterday. It remains slightly intermediate oversold and showing signs of trending higher.

 

Disclaimer: Seasonality and technical ratings offered in this report by www.timingthemarket.ca and www.equityclock.com 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