Good morning, everyone. Welcome to Thursday morning. It’s Stephen Whiteside here from theuptrend.com. In the pre market this morning, stock index futures are flat. Commodities are mixed with crude oil slightly higher, while gold is down another $5 in the pre market.

Now, we do have employment numbers coming out at 8:30 this morning in the US, and that could certainly change the direction of the market on Thursday morning. Well, the VIX continued move lower yesterday, down for its 8th day in a row. And, of course, when the VIX is falling, that is supportive for higher stock prices. When the VIX started to fall, we knew that the crash watch was coming to an end, so we are expecting higher prices here. Unfortunately, the market has moved up to resistance, and that resistance has held us in check.

Now, when a market goes from being oversold to overbought, one of the ways that you can relieve that overbought condition is not only by pulling back, but also by treading water. And so we might be relieving that overbought condition right now by treading water up here at the 437.50 level. Now, we’ve got an open gap just above that level, up at 438.43. We got as high yesterday as 438.09. And so we’re less than $0.50 away from hitting and filling that open gap.

And then we’ll have to see what the market does next. Looking at what’s working. Well, the bonds have been moving up over the past few days, and that’s put downward pressure on bond yields, and that’s helped push the market higher. And if we look at the S&P 500, we’re up there at the 437 50 level. If we look at the equal weighted S&P 500, you’ll see we haven’t been performing as well.

And of course, that’s those big cap tech stocks that are in the Nasdaq 100 that are also in the S&P 500. Now, if they’re equally weighted, they don’t have as much impact on the market. But if they’re weighted based on their market cap, of course, they’re helping move the Nasdaq higher and the S&P 500. And there’s the Nasdaq moving up to resistance at 375 on the triple Q’s. And we’ll have to see if we can get out above that.

Of course, the Nasdaq is once again being fueled by those magnificent seven stocks, which are all on buy signals. Alphabet not doing well right now compared to Amazon, which is heading up to the not only it’s way past the October highs. We’re heading towards the September highs for Amazon. Apple’s pushed through the October highs. And again we’re looking to see if not only can we make a higher high, but can we make a higher low.

And that chapter has not started yet. Now Meta’s still on a buy signal here. Not a lot of upward momentum. We had a big update and then we’ve been crawling higher ever since. Again heading towards those October highs.

There’s Microsoft hitting a new high yesterday and that is making up the majority of the gains for the Nasdaq at the moment. And then we’ve got Nvidia. Nvidia is still struggling to hit the October highs but still on a buy signal, still continuing to edge higher. And the dog of the magnificent seven at the moment is Tesla. Tesla has been treading water here.

Close below 210.88 would give us a sell signal on Thursday. We’re struggling here. We’re stuck to the 218.75 level. There’s an open gap there that could potentially act as a magnet and an area of resistance. If we can take out that gap, then 250 does come into play.

But right now Tesla is struggling to move higher, moving on to the Canadian market. The TSX has been struggling over the past couple of days. That has a lot to do with commodities. There’s crude oil continuing to move lower on Wednesday, pulling down energy stocks which have come down to their recent lows in October. And we’re looking at the iShares for the TSX Energy sector, then looking at gold.

It’s a second day of a sell signal for the price of gold, helping gold stocks move lower again. We’re looking at the ishares for the Gold sector. Of course, the other side of these trades is to play the bear ETFs and watch them go up as the market falls. Now Financials are holding up still. They’re trading Water here up at resistance at 42.97 on the IShares ETF.

And the best performing financial over the past week has been Nuvei, which is up over 30% over the last five trading days. Then we’ve got Fairfax holding up fairly well up here. Of course, if you’re going to own one Canadian stock, it’s probably going to be Fairfax. And then let’s finish off today’s presentation looking at the bull boards for the industrial sector. And industrial is on a buy signal right now.

The best performing industrial right now is Bombardier which has moved up nicely over the past week, right up to the convergence of the 102 hundred day moving average and the top of the fly paper channel. So this could be the end of this move for Bombardier. Hopefully you’ve locked in some profits after this nice up move, and I wouldn’t completely liquidate a position, but the ods of us continuing to move higher from here have diminished quite a bit over the past couple of days. We’ll just have to see what happens next. Moving from the best performing industrial over the last week to the worst performing.

It’s Finning International. And you can see we continue to make a series of lower highs and lower lows with a new low being made on Tuesday. Now, moving down the list, we’ve got Pyrogenesis. It’s on a buy signal right now, but barely close below $0.49 would give us a sell signal on Thursday. If we can continue to move up and break that downtrend line there, then we could move up into the .70 area.

But I wouldn’t expect more from this stock at this time. And then looking at extra is on a buy signal right now. There’s not a lot of love for the stock at the moment. Yes, we were able to generate a buy signal, but the pros have not come back to take control. So this buy signal may fizzle out fairly quickly.

You can see there’s lots of resistance up at the $1.95 level that acted as support back in August and September, and it’s continuing to act as resistance in November. And so here we are at the midpoint between the 1.56 and the 1.95 level. We’re holding support at 1.76, looking to see if we can break out of that range. And then next we’re looking at Extract Technologies and we’re on a sell signal right now that would change on Thursday with a close above $0.75. Let’s finish off looking at Air Canada, and Air Canada looks very similar to a lot of other airline stocks.

And maybe the falling crude oil prices can help this stock. You can see across the bottom here that we tried several times to start a new rally. We were expecting one here. We were expecting one here. Both failed and here we are.

We’ve got one. We are projecting higher prices up towards $23. But projections only know what they know and they don’t know what they don’t know. So it’s just a guide. Right now, the pros have taken control of Air Canada.

The problem is we’re stuck at 18.75 as resistance. That was support back here in September into early October. And so if we can get over that, then look, two lines up to 21.88. That would certainly be a reasonable target to the upside and 21.88 would take us up over the fly paper channel. So there is resistance.

But there is a lot of opportunity here. If crude oil prices can continue to move lower. And we’re currently on a buy signal that would change on Thursday with a close below $17.06. And so far, we’re not expecting that to happen on Thursday. Okay, folks, that is all for this morning’s presentation.

Have a great day. Next time you’ll hear my voice is on Friday morning.

[00:00:00]: Market Overview
[00:00:44]: Market Resistance and Overbought Conditions
[00:01:39]: Impact of Big Cap Tech Stocks
[00:02:32]: Performance of Magnificent Seven Stocks
[00:03:07]: Analysis of Tesla’s Performance
[00:03:47]: Canadian Market Update
[00:04:11]: Financials and Best Performing Stocks
[00:04:37]: Industrial Sector Analysis
[00:05:12]: Best and Worst Performing Industrial Stocks
[00:06:32]: Analysis of Air Canada’s Stock

Stephen Whiteside
TheUpTrend.com
Thursday, November 9, 2023

Good morning, everyone, and welcome to Wednesday morning. It’s Stephen Whiteside here from theuptrend.com. In the premarket this morning, stock index futures are flat, commodities are slightly lower. Now, we do have energy numbers coming out at 10:30 this morning, and they could certainly change the direction of the energy sector on Wednesday. Now, on Tuesday, the VIX continue to move lower for the seventh day. That, of course, is bullish for the overall stock market. Things would change on Wednesday if the VIX were to close above $18.55. From what we’re seeing in the pre-market this morning, we are certainly not expecting that to happen. In today’s presentation, we’ll break it up into three parts. We’ll start off with a look at the US market followed by the Canadian market, and then we’ll close off looking at commodity prices. Probably the most important chart that we’re watching this week is the S&P 500. It has moved up to our next price target and hit that price target yesterday at 437.50, got as high as 437.59. Now, just above that is the top of an open gap that could not be filled in October. So as hard as they tried, we moved up two lines in October, could not fill that gap.

And so far in November, we have not been able to fill that gap. So that gap is a major area of resistance. The market could hit it and reverse, and that could mark the top for this particular move. If we are able to not only fill that gap but close above it, then the probability of moving up to our next price target at 456.31 increases dramatically. But that has not happened yet. Now, Tuesday was a very mixed day for the US market, where most of the major S&P sectors were actually lower on the day. We did see continued strength in consumer discretionary, technology and consumer staples. What didn’t work? Well, materials and energy. We’ll find out that that’s true on both sides of the border. There’s Consumer Discretionary moving up. Yesterday, it almost hit our next price target of 162.50, we got as high as 162.41 before backing away slightly. There’s the Technology Sector moving up. Step One has been completed. We have made a higher high. Step two, yet to be determined and we’re certainly not concerned about that on Wednesday, which is did we make a higher low? And of course, again, we’re not going to deal with that on Wednesday.

We did hit our next price target. So if you had an order to sell in at 75, it got filled yesterday. Of course, I recommend putting orders in just below those price targets. We did get as high as $175.29, so you got covered yesterday. I did mention that we’re going to keep a close eye on Apple to see if Apple would break the pattern of lower highs and lower lows. We did put a slightly higher high yesterday, and so that’s part one of the equation has been reached. But of course, we still need to see what low we make next time the market moves down. Now here’s an area of concern. It’s nice to see technology stocks lead the market higher, but it would be nicer if the chip sector was going along for the ride. As you can see, the pros have no interest in taking control of the chip sector on Tuesday. NVIDIA is still holding up well. It has not made a higher high just yet and we are expecting resistance at the 468.75 level to kick in once again. Then what didn’t work well, the energy sector and we’ve been concerned about this sector for a while now.

If we go back to September, we put in a lower high. Then in early October, we put in a lower low. Then we came back in October, put in a slightly lower high. Now, we’re putting in a new lower low for the energy sector. For the XLE ETF, we were trying to hold support at 84.38, that broke yesterday, and so our next price target for this sector is 81.25. Slumberger was the big loser yesterday in the energy sector. Then we saw Chevron make a new low for this move. Of course, Chevron is a Dow 30 stock. Then looking at what didn’t work, well, the Russell 2000 and the Russell Microcap ETF both pulled back. They both been down for the last couple of days. We’re not getting that broad support for a rally that we would want to see. That puts us on a little bit of a defensive here, thinking that this may not last very much longer, but there’s no proof to that just yet. Just a couple of signs: the stocks index, the chip sector is not participating and mid-cap and micro-cap stocks are not participating. So that’s probably not a good sign going forward.

Now moving on to the Canadian market, here’s a little bit of a problem. What’s working right now? Well, the big cap stocks and the TSX60 have been the best performing and small-cap micro-cap is not doing well. We want those to participate. We want a broad rally to take us into year end. So far, we’re not seeing that. There’s the TSX-60 pulling back yesterday. There is the TSX itself pulling back. Then when you look at mid-cap, small cap, and micro-cap stocks, they did not perform very well yesterday, and that is a concern going forward. What worked? Well, similar to what worked in the US, it was infotech and Consumer Discretionary. Consumer Staples was down. Everything else was down on the day after those two sectors, and then materials and energy stocks were the biggest losers of the day. So there’s Infotech making a new high. This chart looks very similar to Shopify. You’ll see that in a second. The big winner on the TSX Infotech sector on Tuesday was BlackBerry. It’s been on a buy signal for a couple of days now. Hut8 was a big winner yesterday, up 3.51 %. And then there’s Shopify. And Shopify looking very much like the Infotech index itself.

Consumer Discretionary was up yesterday, but it’s consumer staples that have been the big winner over the past week, and that sector was down just a quarter of a % on the day, but it looks like it might be putting in a top up at these levels. Then what didn’t work? Well, Materials was down yesterday. I’ve been on a sell signal for a couple of weeks now. Gold stocks rolled over. They are back on a sell signal. Once again, we put in a lower high. We’ll have to see if we put in a lower low. Then looking at energy stocks, they finally rolled over after being on a buy signal for a couple of days. Certainly, we’re not bullish about the energy sector over the past couple of weeks with both crude oil and then natural gas, both back on cell signals. I have a question now. Will the FlyPaper channel once again hold this support? Will investors be willing to buy the dip or do we break down and finally give up the ghost for the energy sector in 2023? Let’s finish off looking at commodity prices and there’s crude oil breaking down yesterday. We were trying to hold support at ‘81.25.

That didn’t work. Then the 78.13 should have been support. Look at all that support from back in August. That didn’t work. This is looking pretty bearish. 75 and ‘71.88 are certainly our next two targets to the downside. Then we’ve got natural gas on its second day of a cell signal. Once again, putting in a lower high for natural gas. 3.32 would be our next target to the downside. We did find support there in September. Looking at the metals, we still have copper on a buy signal, certainly not helping the mining sector at the moment. Gold and silver both rolled over yesterday. They’re both back on sell signals. We’ve been concerned about both of those for a while now. I think it’s important to point out that the gold and silver market of our fathers is not the gold and silver market of today. Investors have many more options, including all of the cryptocurrencies, which have been doing very well over the past few weeks. If there has been global stress because of what’s happening in the Middle East, there are other options for investors to get in and out fairly quickly besides the gold and silver market.

Okay, folks, that is all for this morning’s presentation. Have a great day. Still a little concerned about the market with the chip sector, mid-capital-cap, small-caps not participating. But certainly, there’s nothing to do about that based on that information on Wednesday morning. Have a great day. Next time you’ll hear my voice is on Thursday morning.

[00:00:00]: Introduction and Market Overview
[00:01:12]: US Market Analysis
[00:02:26]: Technology Sector Update
[00:03:30]: Concerns About the Energy Sector
[00:04:44]: Canadian Market Overview
[00:05:55]: Infotech and Consumer Discretionary in Canada
[00:06:58]: Commodity Prices and Energy Sector Analysis
[00:08:07]: Conclusion and Market Concerns

Stephen Whiteside
TheUpTrend.com
Wednesday, November 8, 2023

100 Years of Economic Data: Insights into the Current Stock Market Correction

Economic data plays a crucial role in understanding the current state of the stock market. By analyzing historical trends and patterns, investors can gain valuable insights into market corrections and potential future movements. In this blog, we will explore 100 years of economic data and its implications for the current stock market correction.

The Federal Reserve’s Role in the Market Correction

One significant factor influencing the stock market correction is the Federal Reserve’s monetary policy. Many market participants are speculating whether the Federal Reserve will cut interest rates below 3% to stimulate economic growth. This decision has important implications for various sectors, including the S&P 500, semiconductor market, and NASDAQ. Wall Street tends to set traps during critical market points, making it crucial for investors to stay informed.

Examining the Stats: Historical Market Corrections

When it comes to analyzing market corrections, historical data can provide valuable insights. By studying previous instances where the Federal Reserve finished rate hikes, we can gain a better understanding of potential future market trends.

One month after the completion of rate hikes, the market has shown both positive and negative returns, indicating a relatively balanced scenario. However, three months later, the market has consistently shown negative returns, suggesting a higher probability of market decline. Interestingly, twelve months after the completion of the rate hike cycle, the market has displayed a bullish trend in 80% of cases. This historical data suggests that there is potential for a bullish market in the year following the completion of rate hikes.

Analyzing Thrust Signals in the Market

Thrust signals, such as the Zuag bread thrust technique, can provide further insights into market corrections. While these signals have occurred numerous times in the past, the statistics indicate a positive correlation with market performance. Studies have shown that 12 months after a thrust signal, the market experiences favorable returns, offering potential opportunities for investors.

Seasonality and Market Performance

Examining seasonal trends can also provide valuable insights into market performance. Historically, the third year of an election cycle tends to be bullish, while the first year often experiences a higher risk of recession. Based on this data, the statistics currently favor a positive market performance for the current year.

Identifying Market Performers and Areas of Weakness

Understanding which sectors are likely to perform well or poorly during a market correction is crucial for investors. The Russell 2000 is often considered a sector with lower performance during corrections, while other sectors may present potential opportunities. It is important to remember that risk management should always be a priority to navigate market uncertainties successfully.

Market Sentiment and the Retail Herd

Examining market sentiment and the behavior of retail investors can provide additional insights. Retail investors tend to follow trends and often display a herd mentality. Analyzing indicators such as put buying premium can help identify market conditions influenced by retail sentiment. When retail investors display a high level of put buying, it often indicates a bullish market scenario.

Short-Term vs. Long-Term Market Outlook

Short-term market outlooks can differ from long-term trends. While short-term indicators may suggest a potential decline, historical data and seasonal trends indicate the possibility of a bullish market in the long run. Patience and reactiveness to market conditions are crucial for successful investing.

Key Events to Watch

Several key events are scheduled for the upcoming week, including the Reserve Bank of Australia’s cash rate decision and Federal Reserve Chair Powell’s speeches. These events have the potential to influence market sentiments and provide further insights into future market trends. Additionally, ongoing corporate earnings reports can impact individual stock performance.

Conclusion

By analyzing 100 years of economic data and historical market trends, investors can gain valuable insights into the current stock market correction. Understanding the role of the Federal Reserve, studying thrust signals, and examining market sentiment can help investors make informed decisions. It is important to consider both short-term and long-term market outlooks and stay informed about key events that may impact market performance. Remember, successful investing requires patience, reactiveness, and risk management.

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Good morning, everyone, and welcome to Tuesday morning. It’s Stephen Whiteside here from theuptrend.com. In the premarket this morning, and it is fairly early, stock index futures and commodities are trading below fair value. So far, it looks like we’re going to see a little selling at the open on Tuesday morning. Now, we don’t have any major economic numbers coming out this week, but we do have a lot of Fed speakers out there roaming the country, and that could, of course, affect the market on an intraday basis. We’ll just have to wait and see what they say and how the market reacts. Now, the VIX is still on a sell signal, so fear is still falling. We’re looking for a close on Tuesday above $19.19 to change that, not expecting that to happen on Tuesday. If you’ve been with us for a while, not only were we looking for a sell signal in the VIX, we’re also looking for a breakdown of the Uptrend line and a move down below the Fly Paper channel. And so far, we have got those things. So we know options traders are not overly spooked at the moment. Now, the stock traders are a bit tired.

They took the market up sharply last week. Yesterday was an inside day for the S&P 500. We’re trading up towards the October highs, still trying to break that pattern. We made a low here. We made a lower high here. We made a lower low here. Now we’re looking to see if we can break that pattern and possibly put in a higher high. There’s lots of resistance up here at the 437.50 level from October, and just above that is the top of an open gap at 438.43. Those numbers are going to play an important role over the next few days. Now, the first thing I look for is did we close below the previous days low? We certainly didn’t do that for the S&P 500. We do have several open gaps below. I always tell you to look at gaps ahead of us, not behind us. But we are expecting a little pullback, a little consolidation this week. Maybe we come down and fill that first open gap. We’ll just have to wait and see how things work out. Now, on a short term basis, the market is very maxed out as you could expect. Here is the percentage of S&P 500 stocks currently trading above their five day moving average.

And if you look, you’ll see we hit a new high last week for this particular time frame. And so what that tells us is that the day traders are currently maxed out. They are looking to take profits right now. They’re looking to see what other stocks they should be in or not be in. And so we’ll have to give them a little time. Now, a pullback here does not guarantee that we go all the way from the top, all the way back down to the bottom. But we do need to work off this overbot condition. We can do that by, yes, pulling back. But we can also do that by trading sideways for a little bit. Now, for longer term investors who really haven’t been participating in much of the market this year, the percentage of stocks in the S&P 500 currently trading above their 200 day moving average, we’re coming off a low, but certainly not as low as we’ve previously been. This chart goes all the way back to 2020. If we’re going to have a year end or Christmas rally, why can’t we just go back up to the highs from 2023?

That could certainly be doable. That’s not too far away, and that would certainly take a large percentage of the stock market up. Of course, if we can eventually break out above those highs, then getting back to the 2020 highs would certainly be a new bull market for the overall stock market. We’re certainly getting ahead of ourselves. If we can just get from here back here, that would be an incredible year and rally for the market. Looking at the Canadian market, the iShares for the TSX 60, we’re certainly projecting higher prices here. We’ve got an open gap to get over. We’ve got mathematical targets to get over. We did have a pullback yesterday, or expecting a pullback today given the fact that crude oil and gold are trading lower in the premarket this morning. Those commodities are so much more important to the Canadian market than the US market. You can see we’re trying to get to 30.47, and just above that is an open gap at 30.66. The US market has a wall. There’s the Canadian markets wall up at those levels. Now, what can hold the Canadian market back? Well, there’s the financials, and they ran into a wall at 343.75. Energy stocks have just put in a lower high, and they’re starting to pull back.

There’s certainly the possibility of a new daily, short term sell signal for the energy sector on Tuesday. Then looking at gold stocks, looks like they also put in a lower high on Friday, pulled back on Monday, expecting another pullback today with the price of gold trading lower this morning. You can see on the index, we were trying to get above 281.25. We traded above it for a couple of days, but couldn’t hold any gains up there. Now we’re going to be looking to see if we can hold 265.63. You can see that acted as support last week, so we’ll have to see if we can hold that. Then looking at Canadian Infotech, we ran into 187.50 and stopped. We’ve been dealing with that for the past couple of days. You can see back in August, we had a nice high up there, which was higher than the previous high. That was a little bit of a fake out, but looking to see if we can break out above 187.50 for Infotech. Then looking at telecom services, again, we ran into resistance at 168.75, looking to see if we can take that out. You can see that 175 is a legitimate target.

Now we’re trying to break this pattern of lower highs and lower lows. I think the best stock to watch to see if that happens is Apple. You can see we made a low in September, then another low in October. We made a lower high in October. Now, we’re looking to see if we can change that pattern. That would be very important for the overall market. This is the most widely held stock in the world. Our mathematical price target for resistance right now is 181.25. If we can take that out, then 187.50 comes into play. Let’s finish off this morning’s presentation looking at commodities. Copper made a new high for this move yesterday. Gold, on the other hand, has been treading water for the past few days. On Tuesday, we’re looking for a close below 1978 to give us a sell signal. For silver, we’re looking for a close below 22.67 on Tuesday to give us a sell signal. Crude oil already on a sell signal. Looks like it may make a lower low for this move today, and that would take us down towards the $75 level as our next target. Then natural gas back on a sell signal.

Natural gas, of course, is nicknamed the widowmaker because it is so volatile and has a lot of trouble holding a trend for any length of time. Looking at the Fly Paper channel, we traded slightly above it back in early October. We did not break away from it. We really need natural gas to break away and then that would tell us that a new bull market in natural gas is starting. That is certainly not the case on Tuesday morning. Okay folks, that is all for Tuesday morning. We are looking for some selling at the open, but we’re not looking for a lot of damage to be caused on Tuesday morning. Have a great day, folks. Next time you’ll hear my voice is on Wednesday morning.

[00:00:00]: Introduction and Market Overview
[00:01:01]: Analysis of S&P and Market Resistance
[00:02:08]: Short-Term Market Conditions and Day Traders
[00:03:10]: Long-Term Market Outlook and Potential Rally
[00:04:26]: Canadian Market Analysis and Energy Sector
[00:05:34]: Overview of Canadian Stocks and Telecom Services
[00:06:42]: Analysis of Commodities: Copper, Gold, Silver, Crude Oil, and Natural Gas

Stephen Whiteside
TheUpTrend.com
Tuesday, November 7, 2023

Hello, everyone, and welcome to Monday morning. It’s Stephen Whiteside here from theuptrend.com. In the pre-market this morning, stock index futures are trading right around fair value. So far, it looks like we’re going to have a fairly quiet open. Commodities are mixed with crude oil higher while gold is down in the pre-market on Monday morning. Now, last week was a historically volatile week for the market, and luckily enough, it was to the upside. I thought we’d do a little recap of how we got here this morning. Remember, we were back in August, we were looking for buying into the middle of September, looking at the seasonality chart of the TSX, and then some selling into October. From the October low, we were looking for a move up into November, which would hopefully lead to a year-end rally. Now, October is a very spooky month for the stock market. Some of the biggest declines in history have happened in October. You find a lot of people on edge during the month of October. Now, a week ago, we were still watching the same movie, which was lower highs and lower lows. That had not changed. A week ago, I asked you to lock in profits on short positions, whether you were short stocks or long-bear ETFs, just to make sure you had already done that.

From that point on, the market moved higher. Why did I tell you to lock in profits down at that level? Well, we were very oversold at the time down at the bottom of the Panic Zones. We were coming into a weekend that had a full moon. We were also coming into month end. You don’t want to trade against that month end of the money. We were also coming into November first. Now, November first is significant because that’s when the sell in May crowd comes back. If traditionally people who are selling in May, they come back on November first or around that date, depending on the calendar. Of course, we don’t want to trade against those people if they come back and think this is the time and place to get back into the market. Now, for six weeks, we were constantly talking about market fear. The reason for that was that we had the VIX on a weekly buy signal. Of course, when the VIX is rising, we know that portfolio managers are willing to pay higher prices for portfolio insurance using options. For six weeks, we were expecting lower stock prices. Last week, what happened?

Well, things turned around sharply. Now, when the VIX is elevated, the least you should be doing is just stop buying and stop looking for buying opportunities in the market because you know the probabilities are that the market is going to go down. Now, if we look at the seasonality of the VIX, you can see that it usually peaks in October and then starts to come down coming into year end. And so it is this trend in the VIX to come down over the next month or so is what helps fuel the stock market rally into the year end. So now that we’ve got the VIX back on a weekly sell signal, we’re going to go from being long term bearish to long term bullish on the market and we’ll continue to be long term bullish on the market as long as the VIX continues to close below $19.50 this coming Friday. Now, if you’re trading the market on Monday, we’re going to remain short term bullish on the market as long as the VIX doesn’t close above $19.81 on Monday. You can see that that upper channel line is starting to point down and is going to continue to move lower daily until we do close above that upper channel line.

Now, we’ve been talking about a range bound market and we were talking about the TSX. If we go back a month, you can see the TSX was trading in a tight range and we were looking to see if the TSX could hold support at 19,375. If that wasn’t the case, then we would expect it to come back down to our next price target at 18,750. Move ahead a month and you can see over the past two weeks, we’ve been holding support at the 18,750 level. Last week, we completely reversed and started to head back up. That’s what price targets are for. They’re not only for resistance, but they’re also for potential areas of support. And of course, if you were short the market, you would be wanting to take some money off the table down at a price target like that. Now, we’re also looking at the Russell 2,000, which was range bound for much longer than the TSX. And we were looking to see if it would break out above 200 or break down below 162.50. A month ago, we were looking to see if it was going to hold the 175 level.

If it didn’t, we were expecting to find support at the 162.50 level. And that’s exactly what happened. We came down for two weeks. We used 162.50 as support. And last week, we headed back up. Our next price target is 175, and we landed at 174.49 on Friday. So it looks like the movie might start to change. We’ve got the remote control away from the cat, and we might be changing from lower highs and lower lows to maybe higher highs and higher lows. And that’s what we’re looking for. We want the year end rally to start. Now, I mentioned last week that I thought the rally was based on short covering. And at the end of the day, it really doesn’t matter. When the market goes up, it goes up and it affects everybody equally. And that’s what happened last week, short covering. That’s why it was so sharp and so fast, because what happens is that people get sucked in. When they see the market trading down at these levels, they just think it’s going to continue to move lower. There’s nothing wrong with going short, but you’re going short at the wrong time.

We want to be shorting off the top, off the start of the trend to the downside, not at the end, but it is at the end where people get emotionally involved in taking a short position. And that mistake of getting in at the last minute is what causes shortcoming rallies to be so quick because the people who shorted down here have no profits in the trade and have to get out as quickly as possible. Now, nothing’s guaranteed. The fact that the seasonality has changed, the fact that we’ve come off lower lows and moved up sharply, nothing’s guaranteed. We just have to work with what we’ve got. What we’ve got is a lot of resistance to the upside. If you’ve been watching our videos SPY, our next resistance is at 437.50, and then just above that is the top of an open gap that hasn’t been filled yet. That’s a potential wall for the market to have to climb over. Now for the triple QQQ’s, 367.19, that was resistance, and we traded up and closed just above that on Friday. Our next target is the October high. Then looking at the Russell 2.000, our next target was 1.75, and we peaked out in October just above that level.

That’s going to be an important area of resistance to get over. Now, the iShares for the TSX 60 actually started to trade above the October highs on Friday. You can see just above that, not only do we have a price target of 30, 47, but we have an open gap to deal with. It could act as a price magnet to pull us up and it could act as an area of resistance. Now, probably the most important chart to watch this week is Apple. Apple did not get hit hard during the month of October. It held up very well. It had very weak earnings out last week and did not get hit hard to the downside. And so we’re looking to see if Apple, the most broadly held stock in the world, if it can hold and maintain a buy signal at this time, that should be supportive for the overall market to continue to move higher from here. So on Monday, we’re looking for Apple to not close below $170.74, and hopefully, it will continue to move higher this week. Okay, folks, that is all for this morning’s presentation. We’ve got to go from being overly bearish to being overly bullish.

We have to wait and see if the market can continue to break out above resistance and if we can start to change the movie script from lower highs and lower lows to higher highs and higher lows. Enjoy the rest of the day. Next time you’ll hear my voice is on Tuesday morning.

[00:00:00]: Introduction and Market Overview
[00:01:12]: Locking in Profits and Market Conditions
[00:02:17]: VIX Signals and Long Term Market Outlook
[00:03:23]: Range Bound Market Analysis – TSX
[00:04:27]: Range Bound Market Analysis – Russell 2
[00:05:30]: Understanding Short Covering and Market Rally
[00:06:44]: Resistance Levels and Price Targets
[00:07:49]: Apple’s Influence on the Market
[00:08:26]: Conclusion and Market Outlook

Stephen Whiteside
TheUpTrend.com
Monday, November 6, 2023

Good morning, everyone, and welcome to Friday morning. It’s Stephen Whiteside here from theuptrend.com. In the premarket this morning, stock index futures are mixed. We’re seeing a little weakness in the Nasdaq this morning, and that has a lot to do with Apple trading lower in the premarket. Commodities are fairly stable. Both gold and crude oil are slightly higher on Friday morning. Now I am doing this video ahead of the employment numbers that are coming out at 8:30 this morning, and they could certainly add to the premarket volatility. Now, it’s been a week since I recommended you lock in some profits on your short positions or your long bear ETFs. Since then, the market has come back nicely and the VIXs continue to fall this week. And of course, a falling VIX is supportive for higher stock prices. Now, if we go back a week and look at the SPY chart for the S&P 500, you can see we were ranked as zero, punching through the bottom of the Panic Zones. This is the time and place that we look for buying opportunities, not selling opportunities. Now we keep a history of that particular indicator at the bottom of the Flypaper Channel chart.

You can see there’s a couple of lines here. There’s one line at the two level, one line at the eight level, anything to or below, that’s the time and place where we look for buying opportunities. That was certainly the situation we were in last Friday. Of course, we talked about the fact that every particular symbol is going to have its areas of potential resistance, whether it’s recent peaks or valleys, recent highs and lows, our mathematical price targets, the moving averages, or even trend lines. In this particular case, last Friday, we had this downtrend line in the S&P 500. Remember, we’ve been talking about the fact that markets have been making lower highs and lower lows, and that was still certainly the case last Friday. We’ve had a very dramatic week over the past five trading days. What do you know? The S&P 500 traded right up to that downtrend line and stopped yesterday. Now here’s the current panic zone chart for the SPY. As you can see, we are projecting higher prices all the way into December, up into the 450 area. Of course, we have to get over recent resistance to get there. Our next price target is up there at 437.50 but if you remember back in September, we got lower and the top of that open gap is at 438.43. Is that an important number?

Well, we couldn’t get up to that level in October. That is still a major area of resistance to get up and over and can a short covering rally get us up and over that? Well, we’ll just have to wait and see. Now, a week ago, the TSX looked like this. Again, it was ranked as zero down the bottom of the Panic Zones, Pressure Zone had formed. What do you know? Yesterday was a huge day up for the TSX. We weren’t on a buy signal coming into yesterday’s trading action. It happened very quickly. Of course, you got to think that most of that is short covering. Now, as you can see, the TSX is traded right back up towards the highs from October, where we stopped on a dime. One of the reasons we stopped on a dime in October was because we ran up to the lows of August. And so what was support on the way down often becomes resistance on the way back up. So it’ll be quite interesting to see and quite bullish if we can take out that October high and drive through the August resistance. Now, Is expecting the US dollar to have to come down for a rally to start, but that is certainly not the case.

And if you’ve been with us before, we talked about using the mid term chart on the US dollar index as it had just been treading water for a month now. Now, bonds have played a much bigger role in the rally this week. Bond traders have come in and started to buy bonds again. And again, it’ll be interesting to see if we take out that October high. Of course, bonds going up has put downward pressure on bond yields, and that has helped fuel this short covering rally. The price of crude oil has been helpful this week. It has certainly not been going up. It is holding the October lows. If those break, then 78, 13, and 75 dollars come into play. Now if you were with us yesterday morning, I was pondering why Shopify had not participated in the Big Cap tech rally this week and then this happened. And so Shopify gap to hire yesterday and closed near the high of the day, which looks pretty bullish and traded up towards the top of the Panic Zones. I’m not sure that I would want to be jumping in on Shopify on Friday morning, but certainly if you still have a short position, you’d want to cover any short position that you have remaining.

Now, when we talk about shorting stocks, we want to be shorting off the top of the Panic Zones where an early warning signal has gone off and you get a right side sell signal. That’s the time and place you short stocks. You do not short stocks when they’re trading down the bottom of the Panic Zones where a Pressure Zone has formed. That’s the time and place where we get short covering rallies. One of the reasons we get short covering rallies is that the public is usually comfortable enough to short a stock when it’s down at the bottom of the Panic Zones. They don’t know what Panic Zones are, but what they have is psychological support to take a short position. That psychological support is often based on the fact that when a stock is hitting new lows on any particular move, that’s when there’s the most negative news and negative opinions about that stock. They have a current history of the stock trading lower and lower and lower. Why can that not continue forever? This is the time and place where they like to short stocks. Of course, it’s the worst time and their shorting at the end that causes a lot of the short covering rally because as soon as the stock starts to turn around, they have absolutely no profit in their short trade and have to cover as quickly as possible.

That’s certainly what we saw in Shopify on Thursday. Now, while stocks have been coming back this week, there’s still a lot of stocks that are dropping out of the sky. It’s very easy to just go through and see some of the stocks are still getting hit hard on Thursday, while the rest of the market was moving sharply higher. Now, Apple is in the news this morning. It has been on a buy signal for the last couple of days. We’re still projecting higher prices here. There’s how Apple closed yesterday, second day of a buy signal. It is trading lower this morning. And of course, this number is going to be different by the time you see this video. But we are trading in the channel. We’re not trading through the lower channel line right now. So so far, it doesn’t look like we’re going to see a sell signal for Apple on Thursday. Of course, if we ended the day with a sell signal for Apple, that would certainly be bearish for the overall market. Now with this short covering rally, you’ll notice that on a lot of the charts, the pros have not taken control just yet.

It’s going to take a couple more days of higher closes than higher opens for us to see the pros actually take control. So again, a lot of short covering rallies this week. It doesn’t mean that it can’t continue to go higher from here. Certainly, a short covering rally can be a spark for a major trend change, and we’ll just have to give it time to see if that is actually the case. Let’s finish off with a look at gold and gold stocks. We’ve got the price of gold up at the top of the Panic Zones. Early warning signals have gone off. We’re still having trouble getting over $2,000, which is for us, a mathematical target, but it’s also a big round number, so a big psychological target. Gold had an inside day on Thursday. On Friday, we’re looking for a close below $1,972.50. From what we’re seeing in the premarket this morning, not expecting that to happen. Now, gold stocks have pulled back ahead of the price of gold. You can see on the GDX, the early warning signal up there at the top of the screen on the panic zone chart. We had a couple of bearish reversal days marking the top for this move.

We’re on a sell signal right now, but really not trending lower at the moment. We’re just not attracting new buyers right now. That’s also true on the XGD, a couple of bearish reversal signals, early warning signal at the top of the Panic Zones. There we are, we’re on a sell signal. I put in a low on Wednesday, I did not take out that low on Thursday. You can see that there’s a couple of open gaps over here and there’s one, there’s the other one. They may need to get filled before gold stocks can start rising again. We’ll just have to wait and see how that turns out. And that’s all for this morning’s presentation, folks. It’s still fairly quiet. We’re still ahead of those employment numbers that will come out at 8:30. And that could certainly add some additional volatility this morning. Enjoy the rest of your day. Enjoy your weekend. Enjoy your extra hour of sleep this weekend. And next time you’ll hear my voice is on Monday morning.

CHAPTERS:
[00:00:00]: Introduction and Market Overview
[00:01:08]: Buying Opportunities in the S&P
[00:02:40]: Resistance Levels and Price Targets
[00:03:50]: US Dollar, Bonds, and Crude Oil Analysis
[00:05:01]: Shopify’s Gap Up and Short Covering Rallies
[00:06:19]: Shorting Stocks and Psychological Support
[00:07:21]: Pros Taking Control and Short Covering Rallies
[00:08:26]: Gold and Gold Stocks Analysis
[00:09:30]: Market Volatility Ahead of Employment Numbers
[00:10:45]: Conclusion and Weekend Wishes

Stephen Whiteside
TheUpTrend.com
Friday, November 3, 2023

Good morning everyone and welcome to Thursday Morning. It’s Stephen Whiteside here from theuptrend.com. In the pre market this morning. Stock index, futures and commodities are currently trading above fair value. So we are looking for some buying at the open at 9:30 Thursday morning.

Now I am doing this video ahead of the employment numbers coming out at 8:30 this morning. They could certainly add a spin to the pre market activity. We’ll just have to wait and see. Now crash wash season has come to an end. A couple of things have happened.

We’ve made it through October, the Fed meeting has come and gone and the market reacted positively to it. And we’ve got the VIX back on its second day of a sell signal. So options traders are certainly not looking for a market crash at the moment. Of course that could change on a dime, but this is what we’re looking at coming into Thursday’s trading action. The S&P 500 ETF traded up to the upper channel line yesterday.

So sitting right on the edge of a new daily buy signal and it looks like we may get that today. Now every symbol that you look at is unique. We made a recent low, we’re trying to hold that low and we also made a recent high and we’re trying to break out above that high. So the first thing that’s happened is a lot of charts have already started to trade above their October lows. So typically what was support on the way down is often resistance on the way back up and we’re kind of expecting a little more resistance at the October lows, but we blew through that yesterday, so that isn’t an issue anymore.

And so the next major target of course is going to be the October highs. So we’ll have to see what the market does if we can get up to those highs. Every chart is unique. Every chart is going to have moving average resistance, every chart is going to have Flypaper Channel resistance and every chart is going to have mathematical price target resistance. So right now look two lines up, that takes us up to 437, 50 or the October highs.

And there’s also an open gap up at that level. So each chart is unique. Each chart is going to have its own targets on the way back up and hopefully we can change the script from lower highs and lower lows to higher highs and higher lows and hopefully that’ll take us into year end with a nice Christmas rally. Looking at the Nasdaq 100, we are back on a buy signal as of Wednesday’s close. Looking at the mid caps in the Russell 2000, no joy yet.

Looking for a close on the IWM above 167.44 on Thursday. Micro caps have closed in the channel for the past two days. Looking for a close above 93.80. And then looking at the Canadian market, the Ishares for the TSX 60 traded up yesterday. We need a close on Thursday above 29.18 to give us a buy signal.

And then small caps traded up to the upper channel line yesterday, while micro caps closed slightly lower on the day, still closing below the lower channel line. Next up, let’s take a look at the New York most actives, and we’re looking at the price volume leaders, so that means we’re looking at where all the money went on Wednesday at Tesla. Traded higher, looking for a close on Thursday above 220 63 for Nvidia. Big day for Nvidia on Wednesday. We’re looking for a close on Thursday above 427.45.

Then AMD, which was trading lower in the pre market yesterday morning, spiked sharply higher yesterday, heading towards those October highs. So we’re back on a buy signal there. We’re back on a buy signal for Apple ahead of earnings, which are coming out today. So let’s see if we can take a run at those October highs. Then we’ve got Microsoft.

Microsoft made it all the way through October without generating a sell signal. And there’s a new high for Microsoft for this move. Amazon continues to move higher, has taken out the open gap, which is now closed. And so the next major target would be those September highs for Amazon. Then we’re looking at Meta.

Meta back on a buy signal as of Wednesday’s close. No joy for Google, still trading below the lower channel line and that open gap. Then we’ve got Exxon, traded up to the lower channel line, but reversed. And so we’re looking for a close above 109.29 on Thursday to give us a buy signal for Exxon. And last up, looking at US.

Stocks this morning is Netflix. Netflix making a new high for this move on Wednesday. Let’s finish off today’s presentation. Looking at the TSX most actives. And again, these are price volume leaders, so Enbridge is number one.

And Enbridge is back on a buy signal as of Wednesday’s close. Now, on a positive note, you can see we’ve made a couple of higher lows over the past couple of weeks. And here we are coming up to the October high. At the same time. You might want to give this one a little more room.

This stock has been in the doghouse for quite a while now. And on the midterm chart, we still need to close above the Tether line there. You can see that since back in April we’ve been trading below the fly paper channel and has continually acted as resistance. So I wouldn’t have much hope for this stock at this time. Then looking at the TD Bank coming off new lows last week, looking for a close on Thursday above $78.75.

There’s Suncor. Suncor came down, filled the open gap that was left in October. And now we’re moving back up, looking for a close on Thursday above $45.99. Then Canadian Natural Resources back on a buy signal as of Wednesday’s close. Then we’re looking at the Royal Bank again.

We made a new low last week and here we are coming back up into the channel looking for a close on Thursday above $111.96. We’ve got Restaurant Brands or Timmy’s making a new high for this move on Wednesday, so no change in trend there. Then we’re looking at the Bank of Montreal, still closing below the lower channel line. We need a close on Thursday above $100.03. Then looking at Shopify trading back up into the channel yesterday, certainly not getting the love that a lot of other big cap tech stocks got yesterday.

We were up over 3% on the day, which isn’t a lot for Shopify. Looking for a close above 69.56 on Thursday to give us a buy signal. Then looking at Manual Life, we’re back on a buy signal as of Wednesday’s close. Okay folks, that is all for this morning’s presentation.

Ahead of those employment numbers which are coming out in just a few minutes. We’ve got stock index futures and commodities trading higher. So far it looks like we’re going to see some buying at the open. Have a great day folks. Next time you’ll hear my voice is on Friday morning.

[00:00:00]: Introduction and Pre-market Analysis
[00:00:29]: End of Crash Wash Season
[00:00:55]: S&P ETF and October Highs
[00:01:30]: Unique Chart Targets
[00:02:26]: Nasdaq and Russell 2000
[00:02:46]: Caadian Market and Small Caps
[00:03:17]: Price Volume Leaders: Tesla, Nvidia, AMD, Apple, Microsoft, Amazon
[00:03:57]: Price Volume Leaders: Meta, Google, Exxon, Netflix
[00:04:19]: TSX Most Actives: Enbridge, TD Bank, Suncor, Canadian Natural Resources
[00:05:19]: TSX Most Actives: Royal Bank, Restaurant Brands, Bank of Montreal, Shopify, Manual Life

Stephen Whiteside
TheUpTrend.com
Thursday, November 2, 2023

This video has been translated into Arabic, Chinese, French, German, Hindi, Japanese, Korean, and Spanish.

Good morning, everyone, and welcome to Wednesday morning. It’s Stephen Whiteside here from theuptrend.com. In the pre-market this morning, stock index futures are slightly below fair value. We do have some economic numbers coming out this morning, but the world is going to sit and wait for the Fed meeting. And that event starts this afternoon after 2:00 PM. Now, the month of October was a pretty crappy month. This is a pretty good image to sum it up. My pumpkin just looked at the chart of the Russell 2000. And yeah, a lot of people are feeling that way right now. When we look at the month of November, statistically, it is a bullish month about 80 % of the time. What these particular numbers and dates don’t show you is that we can always start the November rally from a lower or lower than where we are right now. So just because you have statistics that say that we’re going to be up 80 % of the time doesn’t mean you jump in with both feet right now. We may actually be able to jump in with both feet later at a lower price point. We’ll just have to wait and see.

For the month of October, the S&P 500 was down 2.17 %, still up over nine % year to date. The Nasdaq was down 2.07 %, still up over 31 % year to date. A little more weakness in the Russell 2000, down nearly 7% for the month, down nearly 6% year to date. And then when we look at the microcap stocks, we’re down over seven % for the month, down over 13 % year to date. And if you look back, you can see that we’re trading back at levels from 2019, 2020. Then looking at the Canadian market, the TSX was down 3.42 %, down 2.64 % year to date. And then looking at the Venture exchange, we’re down 7.66 % for the month of October, down nearly 10 % year to date. And again, we’re going back to levels we haven’t seen since 2019, 2020. Now looking at daily charts, the VIX came down yesterday. It is back on a sell signal that’s supported for higher stock prices. This tells us that options traders are a little less cautious coming into November first. We did see the DAO trade up into the channel yesterday.

The S&P 500 and the Nasdaq 100 both traded up to the lower channel line, so still no buy signals just yet. The Russell 2000 also traded up to the lower channel line, and the microcap sector closed in the channel. Looking at the Canadian market, the iShares for the TSX 60 had an inside day yesterday. Now, one of the stocks that helped hold the TSX in check on Tuesday was the biggest loser on Monday, and it continued to move lower on Tuesday, and that’s First Quantum. We came into Monday’s trading action already on a daily sell signal, a weekly sell signal, and position traders were also on a sell signal. So really, nobody was very bullish on this stock coming into Monday’s trading action. And the biggest loser on the S&P 500 on Monday also continued to move lower on Tuesday, and that was On Semiconductor. Again, already on a weekly sell signal and position traders were already on a sell signal. So no real surprise that the stock continued to move lower. Of course, what was an open gap on the way down would probably act as resistance on the way back up. Now, in the pre-market this morning, Paycom is down sharply in the premarket.

We also Advanced Micro Devices unwinding some of the gains from yesterday. In both cases, no change in trend. If you’re short either of those stocks, you can continue to remain short. Now, while the world is waiting for the Fed, a lot of the financial community is watching the Japanese Central Bank and Japanese stocks and higher after Bank of Japan allows greater flexibility in yields. They may start to pump up their interest rates over the next little while. That hasn’t started yet, but it may start anytime. Japanese stocks were up yesterday. We expect a lot more volatility out of the Japanese market. If we look at what happened in the currency market, you can see on Monday, we had a buy signal. Tuesday, a big reversal to the downside for the Japanese Yen. And then compare that to the US dollar. Us dollar is still fairly stable. We entered this trading range back in the middle of September and have been trading sideways ever since. So they’re probably waiting for the Fed meeting or some major catalyst to help move the currency market. If we look at the midterm chart for the US dollar index, you can see that we’re down near 105, and that’s where a real change in trend would happen if the US dollar index were to come down below that level.

Let’s do a quick update on our seven stocks. Actually, there’s eight stocks in this list this morning. We have two of the eight back on buy signals, one never left. If we start off with Alphabet, you can see a fairly quiet trading close lower on Tuesday. Amazon is on its second day of a buy signal. Remember, we did this back in October, so we’re looking for a breakout above the October high and the open gap. Then looking at the Apple, still on a sell signal here, no change in trend, no change in trend for Meta, and no change in trend for Microsoft, inside day on Tuesday for Microsoft. Inside Day on Tuesday from Microsoft, there’s NVIDIA making a new low for this move on Tuesday. And then we also had a new low for Tesla before Tesla recovered and actually closed higher on the day. Certainly, nowhere near a buy signal coming into Tuesday’s trading action. And last up, I added Shopify to this list, new low for Shopify on Tuesday, and then came back and closed slightly higher on the day. Again, no change in trend. Let’s finish off looking at the metals and miners.

Copper is on its third day of a buy signal right now. At the same time, copper stocks made a new closing low for this move on Tuesday, so no change in trend there. It’s always important to remember that if you’re involved in the commodity, you follow the commodity. If you’re involved in stocks, you follow the stocks. The fact that copper may get a buy signal does not mean you do anything specifically with stocks unless stocks generate a buy signal. There’s absolutely no reason that you use one for the other. Sometimes rising metal prices can be supportive for stocks. Sometimes it can’t. At the end of the day, you’re trading stocks. You’re not actually trading the commodity. That’s also true for gold. Gold pulled back yesterday. It’s still having trouble breaking out above 2,000, and gold stocks on the GDX came back down. They’re still on a sell signal. No change there. New change in trend for the AXGD, which is back on a sell signal as of Tuesday’s close. Then looking at the price of silver still in the channel, still on a buy signal, that would change on Wednesday with a close below $22.71. Then we have silver stocks back on a sell signal.

Looking at the Silver Miners Index, the SIL, that is back on a sell signal as of Tuesday’s close. Okay, folks, that is all for this morning’s presentation. The market will be sitting on its hands until 2:00 PM this afternoon. I think most people think that the Fed is going to pause, but it always matters what adverbs and adjectives the Fed uses when it describes how it’s thinking and what it may do in the future. That’s where all the volatility comes from. So have a great day, folks. And next time you’ll hear my voice is on Thursday morning.

[00:00:00]: Introduction and Market Overview
[00:01:03]: October Performance of S&P, Nasdaq, Russell, TSX
[00:02:14]: Daily Charts and Canadian Market Performance
[00:03:26]: Pre-market Movement and Japanese Market Update
[00:04:49]: US Dollar Index and Currency Market Analysi
[00:05:58]: Update on Selected Stocks: Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, Tesla, and Shopify
[00:07:11]: Metals and Miners: Copper, Gold, and Silver Analysis
[00:08:13]: Anticipation for the Fed Meeting
[00:08:52]: Conclusion and Market Expectations

Stephen Whiteside
TheUpTrend.com
Wednesday, November 1, 2023

This video has been translated into Arabic, Chinese, French, German, Hindi, Japanese, Korean, and Spanish.

Good morning, everyone, and welcome to Tuesday morning. It’s Stephen Whiteside here from theuptrend.com. In the premarket this morning, stock index futures and commodities are trading above fair value. So far, it looks like we’re going to see some buying at the open on Tuesday morning. Where we’re not going to see some buying? Well, that’s in JetBlue. Jetblue is out with earnings and it’s down another 5, 7% in the premarket. So if you’re short, JetBlue, still no reason to buy back the remainder of your position. Now it is month end. Month end usually has a bullish bias to it. That’s one of the reasons that we recommended that you lock in profits on any long bear ETFs or short stocks on Friday if you had not already done so. Some people have certainly been locking in profits on the way down. We wanted to make sure you did that on Friday because we expected the market to turn around this week. Now the Fed meeting is going on. It’s a two-day meeting, of course, and volatility in the stock market should start to expand after 2:00 PM, Wednesday afternoon. Now, the VIX closed lower yesterday into the channel, not enough to give us a sell signal.

That would happen on Tuesday if the VIX were to close below $18.85. And if the VIX continues lower from here, that’s supportive for higher stock prices. The Dow, the S&P 500, and the Nasdaq 100 all closed higher yesterday, all closing above the previous day’s high. That’s a bullish sign. It could be the start of something. Of course, only time will tell. Now, that didn’t happen for the TSX. The TSX did close higher on Monday, but not above the previous day’s high. And we saw some big selling in a couple of the TSX 60 stocks. First Quantum was down over 28% on the day coming into yesterday’s trading action, already on a sell signal. That is also true for Franco Nevada, which was down over 8% on the day. That’s one of the reasons or two of the reasons why the TSX did not close above Friday’s high. Now, semiconductors also continued to move lower yesterday. At the same time, the best performing stock on the S&P 500 on Monday was Western Digital was up nicely, but not enough to give us a buy signal, did not close above the previous day’s high. Then the worst performing stock on the S&P 500 was ON Semiconductor down over 20 % on the day.

We also saw a weakness in NXP. We also saw a weakness in Analog Devices and Microchip Technologies all down on the day pushing the semiconductor index lower. What didn’t move lower? Well, NVIDIA was up on the day 1.63 % on the day closing right at the previous day’s high. Still trying to hold the 406.25 level. On Thursday, we dipped down below $400 and came back. And so we are finding support there. I noticed once again, on Thursday, we put in a lower low. That movie is still playing out. That has not changed just yet. What worked on the TSX? Well, it was consumer staples and information technology. What didn’t work was materials and energy, and you saw some material stocks already down. Consumer Staples was up, and that was Loblaws, George Weston were up nicely yesterday contributing to that. Infotech was up and closed above Friday’s high. That is positive. What didn’t work? Well, we looked at materials or a couple of material stocks earlier and it was down on the day. We also have the energy sector closing lower. I’m not trending lower at the moment. We’re still on a sell signal here, but certainly there isn’t a trend in place.

Now in the US, everything worked cross the board for all the major S&P sectors, and the biggest winner was communication services going up filling that gap. That’ll be interesting to see what happens next. Transports, which were not on the list, but they were performing very well yesterday, up nearly 2% on the day, so possibly a bottom for transports. We’ll just have to wait and see. And then we had the financials up. Now, while the financial index moved up and actually traded above Friday’s high, closing right at Friday’s High, you’ll notice that banks, regional banks, and the broker dealers all had inside days, so really a day of indecision for the financial sector. Now, the weakest of the major US sectors on Monday was the energy sector, closing up a third of a %, still trying to hold the $84 level. Our mathematical target was $84.38. We traded a little below that yesterday, putting in a lower low. That theme hasn’t changed. Of course, the first sign something new is happening is if we can close above Friday’s high. Let’s finish off today’s presentation looking at the major US commodity ETF’s, starting with the USO.

No change in trend there. No change in trend for gasoline. Big change in trend for natural gas, which rolled over and closed below the lower channel line yesterday. So natural gas back on a cell signal as of Monday’s close. Inside day on Monday for the GLD. No joy for palladium. Platinum continued to move higher on Monday and silver closed higher on Monday. And it’ll be interesting to see if we can take out last week’s high for the price of silver. Okay, folks, that is all for this morning’s presentation. Looking for some buying at the open on Tuesday morning. Not expecting a lot of volatility. Things usually calm down before the Fed meeting is over. Of course, that happens at 2:00 PM, Wednesday afternoon. Enjoy the rest of your day. Next time you’ll hear my voice is on Wednesday morning.

[00:00:00]: Introduction and Pre-Market Analysis
[00:01:10]: VIX and Stock Market Outlook
[00:02:27]: TSX and Semiconductor Performance
[00:03:46]: Sector Performance on TSX and US Markets
[00:05:00]: Commodity ETF Trends
[00:06:00]: Conclusion and Market Expectations

Stephen Whiteside
TheUpTrend.com
Tuesday, October 31, 2023

[00:00:00]: Introduction and Market Overview
[00:01:08]: Historical Events in October
[00:02:19]: Long-term Bearish Market Outlook
[00:03:32]: Winners and Losers in the Stock Market
[00:04:44]: Disappointing Financial Stocks Performance
[00:05:57]: Focus on Russell and NASDAQ
[00:07:10]: TSX Market Range Analysis
[00:08:25]: Bond Market and Currency Trends
[00:09:27]: Crude Oil and Energy Sector Performance
[00:10:39]: Gold and Financial Institutions

Hello, everyone. It’s Stephen Whiteside here from theuptrend. com, and welcome to this weekend’s edition of Stock Market Timing television. Well, the stock market ended on a low on Friday. If you’re looking at the S&P 500, the Nasdaq hit a low on Thursday for the month of October, and then Friday was an inside day. And for the iShares for the TSX 60, we also hit our October low on Friday. So not a pretty picture going forward. Now, we came into October knowing that the seasonalities were weak, whether you were looking at the S&P 500 or they’re much easier to spot on the TSX. Then from this point on, the market is usually pretty bullish, but we don’t know exactly when it’s going to start. October is not only seasonally weak if we look at the last 20 years, but if we go back in time, there’s a lot of negative historical events that have happened in the month of October. Going back to the panic of 1907, then, of course, the crash of ’29, the crash of ’87, I was trading back then, and it’s when I flipped over from being a fundamental trader to a technical trader.

Then, of course, the Asian Financial Crisis and then the Global Financial Crisis in 2008. Now, we are coming up to the end of October, and that’s when the sell in May crowd comes back. One of the most successful investment strategies in history, of course, is the selling on May first and coming back and buying on November first. It’s often called the Halloween indicator. And that could kick in in the not so distant future. We also have a full moon this weekend and we’re coming up to month end. And traders typically don’t like to trade against the automatic money that comes into the market at monthend. Now, as a long term investor, we want to remain long term bearish on the market as long as the VIX does not close below $15.22 this coming Friday. So for the last six weeks, the VIX has been on a weekly buy signal. That, of course, is long term bearish for stocks. And we’ve seen that work out throughout the month of October. The pros are still in control on a weekly basis. We’re projecting higher prices here on our panic zone chart. And if we go back in time, you can see that back in March of this year, the VIX got all the way up to 3,125.

If we go back to last fall, we got up to 34.38. Then nearly two years ago, we’re up at the 37.50 level. Technically, there is a lot more room to go on the upside based on recent trading activity, but the bears could be running out of time here. We’ll just have to wait and see. The first sign that something new is happening is going to be a change on the daily chart for the VIX. And coming into Monday’s trading action, we’re looking for a close at the end of the day below $18.66 on the VIX for the S&P 500. That would be the first sign that something new is happening on the bullish side of the market. And of course, if that doesn’t happen on Monday, that lower channel line is going to continue to move higher daily. Now, 2023 has been all about the Nasdaq-100 and a handful of stocks. When we look at the Nasdaq-100, it’s currently clustering around the 200-day moving average. When we look at what’s been working in 2023, Citia has been the big winner. It’s a $400 stock. It was recently a $500 stock, and it’s currently up 177 %, followed by Meta up 146 %, and then Tesla at 68.29 %.

Those are huge, big cap stocks that have been holding the market up. The rest of the market is not looking for any moving average support. Whether you’re looking at the Russell 2000 or you’re looking at the TSX, there’s no potential support from the moving averages right now. The big line in the sand is that 200-day moving average on the NASDAQ. Now, when we look at what’s not been working, some stocks have just been crushed this year. I believe the biggest losing stock on the S&P 500 is SolarEdge, down 72 %, generated a sell signal back in March of this year. Then on the NASDAQ-100, it’s end phase, which is down 69 %, big sell signal back in late 2022. On the Dow 30, it’s Walgreens, which also came in with a sell signal right at the start of the year, down over 43 %. On the TSX, the big winner on the TSX-60 is Cameco, up over 71 %, gave us a weekly buy signal back in April of this year. Now on the TSX, only 24 of the TSX60 stocks are currently positive for 2023. So it’s been really hard to find winners in 2023.

And I guess the biggest disappointment for me, and there’s not stocks that I actually trade, but just watching the financial stocks disintegrate in 2023. And here’s the Canada’s biggest bank, the Royal Bank, making a new low this week for 2023. Now, the Royal Bank and all the major banks are widely held. You know when you see a chart like this that the average investor, whether they’re actively involved in the market or if they’re in long term mutual funds, they’re getting hurt at the moment. Now we’ve been following the same script, the same movie, the same book, the same theme for months now in which we’ve been making lower highs and lower lows. It’s going to take some work to change that because not only do we need a nice rally into November, but then it’s not the rally that tells us what’s going to happen, it’s what happens after. And what we’re going to want to see is a rally above recent highs followed by a pullback above recent lows. And so it’s a two step approach to actually change the theme of lower highs and lower lows. Now, while the world is watching the Nasdaq, I’ve been watching the Russell 2000, and we’ve been talking about this for quite a while.

The Russell 2000 has been in a tight range for almost two years now. Looking at the IWM, $200 at the top of the range, $162.50 at the bottom of the range. Speaking of lower highs and lower lows, there was a high back in the middle of 2022, a lower high in early 2023, an even lower high in the summer of 2023. Now we’re looking to see what happens at the bottom of the range. On Friday, we actually closed below the level. We closed up 162.21, so that was our price target. If we continue to move lower from here, then 150 and 137.50 could certainly come into play, and that would be very ugly for the overall stock market. Looking at the Canadian market, the TSX has been in a tight range in 2023. Looking at this chart from a month ago, what we were looking for was, could we break out above the highs of 2023, which were just above the 20,625 level? Again, look at this pattern. There’s a high, lower high, and then in the summer, we put in an even lower high, bearish all the way across. We are trying to hold support.

We actually penetrated below the 19,375 level, but the market always came back. That’s where we were looking to find support and move ahead a month. What happened? Well, we were looking to see if the 19,375 level would hold. If it didn’t, then 18,750 would be our next target. Where did we end on Friday at 18,750? Nope, we ended at 18,737 and change, so just below this level. And of course, if we continue to move lower from here, we can go back to the lows from 2022 down at 18,825. That would certainly be a logical move to the downside if we keep going lower from here. Now, if we do want to change the movie to change the channel, we need to get the remote control away from the cat. To do that, we’re probably going to need bond traders to change what they’ve been doing in 2023. The third year bond hit a new low this week and actually closed higher on the week. But what it didn’t do, it did not close above the previous week’s high. So nothing going on there so far. The pros: nowhere near taking control. But that doesn’t mean they can’t bid up bonds.

That just means that we’re not going to have a new uptrend start anytime soon. Now, the TLT also made a new low this week and also closed higher on the week, but again, did not close above the previous week’s high. Bond yields pulled back. Whether you’re looking the 30 or the 10 or the 5, they all pulled back, but again, did not close below the previous week’s low, so nothing has started just yet. Now, if we can get bond traders to get back in there and start buying bonds, that could also put pressure on the US dollar index, which actually closed higher on the week while the euro closed slightly lower and the Japanese Yen was slightly higher after making a new low this week. No change in trend for any of the major currencies. Next up, let’s take a look at commodities. Crudeoil had another wild week trading down to the lower channel line. We need to close this coming Friday below $81.88. That would give us a new weekly sell signal. We’re looking for intraweek support at the $81.25 level. If that breaks, then $75 would be our next target to the downside.

Energy stocks got hit hard in the US down over 6%. That had a lot to do with just two stocks. Looking at the Chevron, which was down 13.47% and Hess, which was down 12.1% on the week. So both of those putting huge downward pressure on the US energy sector. Canadian energy stocks were down, but not by that much, down 2.35%. Looking at the iShare’s TSX energy ETF, and you can see Sunnovus traded right down to the lower channel line, but did not close below it. This coming Friday, we would be long term bearish on Sunnovus if it were to close below $26.33. Now, the gold futures contracts traded up to 2,000 again. Now, depending on where you look, what futures contract, whether you’re looking at spot or cash, gold has been able to trade above $2,000, but has been unable to break away from it just yet. The GLD closed at a new high for this move on Friday, and we’re trying to get to 187.50, and that’s where sellers started to come in back in March and April of this year. Looking at gold stocks in the US, they closed down nearly 1 % on the week, still on a weekly sell signal, no change there.

Canadian gold stocks were down just a tick on the week and still on a weekly buy signal, so no change there. Let’s finish off today’s presentation with a quick look at financial institutions. You’ve probably heard me say this, but US insurance companies have held up very well over the past couple of months. That came to an end this week. The previous week, we made a new high and traded above the early 2023 high. This week, we came down hard. We’re back on a weekly sell signal, joining the rest of the financial sector. Now, the S&P 500 financial ETF has not broken down below the 2023 lows or retested them. That’s also true for US banks and US regional banks. That could happen before the market starts to turn around. But it’s important to remember that during a rate tightening cycle, the Fed usually breaks something. It’s often a financial institution. Sometimes it’s a whole country. You just have to wait and see what happens. It’s still very risky to be in any US financial stock. It might even be more risky to be in a Canadian financial stock right now. Look at the TSX financial ETF.

It’s breaking down below the lows from a year ago. If we start breaking away from 40, 63, then 3750 comes into play for the iShare’s financial ETF. Then looking at Canadian banks, this is the BMO equal weighted bank ETF. We broke down below that low a while ago. We’re looking to trade down to the bottom of our weekly projected trading range for this ETF, which would be all the way down at 20, 8, 13. Remember, we started way over the left-hand corner of the screen back at $42. That’s quite a move for Canadian banks. But right now, they’re looking weaker than the US banks, and that could present a problem going forward. Okay, folks, that is all for today’s presentation. We’re going to be watching the VIX closely to see if options traders start giving up their hedges against lower stock prices. If that starts to happen, that could be the first sign that something new is happening and it could be the potential sign that the year-end rally has started. But coming into Monday’s trading action, we’re not expecting that to happen on Monday. Enjoy the rest of your day. Next time you’ll hear my voice is on Tuesday morning.

Stephen Whiteside
TheUpTrend.com