Good morning, everyone, and welcome to Thursday morning. It’s Stephen Whiteside here from theuptrend.com. In the premarket this morning. Stock index futures are down across the board. Dow futures currently down about 200 points. In percentage terms, it is the Nasdaq leading the markets lower this morning. Commodities are trading slightly higher in the premarket on Thursday morning ahead of a lot of economic numbers coming out at 830. That could certainly change the overall tone of the market. Now, if you’re with us, yesterday morning I mentioned that we’re going to focus on commodities today. Unfortunately, that’s not the case given on what’s going on in the markets right now. Now yesterday looked like it was a pause day. We saw a slight gain for the VIX. We saw a small pullback for the Dow for the S&P 500, a small gain for the Nasdaq. No change in trend here, of course. Then a small pullback in the Russell 2000 in small caps and micro caps. So no change there. And then we saw semiconductors move up into the channel yesterday before pulling back and closing slightly higher on the day. So no change there. Now the TSX pulled back into the channel yesterday.
We saw some dramatic moves in some individual stocks yesterday. The railroads were down sharply yesterday. So Canadian Pacific back on a sell signal. Big down day for CN. We also saw a huge reversal for Rogers and for the Royal bank. So some explosive moves to the downside in some major canadian stocks on Wednesday. In the US market yesterday morning. At this time, we knew Tesla was going to pop and it certainly popped above our upper channel line and held that going into the close. So technically that is a buy signal. And Tesla was actually the number one performer on the Nasdaq and the S&P 500 yesterday, it actually turned out to be a fairly weak day. Now, yes, Tesla was up over 12% yesterday. And I, at the end of the day, it looked fairly weak to me. It looked like mostly short covering. And the reason I say that is it opened at $162.84 and it closed below that at the end of the day. So that to me looks like a very weak day. Yes, there was short covering. Yes, it popped. Yes, it is back on a buy signal, but I’m not overly excited about it.
It’s up $0.50 last time I checked in the pre market. Of course, any pre market numbers I give you here are going to change by the time you see this presentation. Now here’s something unusual. You know, we were talking about the fact that this is a relief rally it’s a risk off rally. And, you know, Coca Cola was the best performing stock on the Dow yesterday. That’s not something you see very often. I’m sure it’s happened before, but I don’t remember seeing it. So, yep, that’s a risk off trade if you’ve ever seen one in the pre market. Yesterday, Boeing was actually up in the pre market and ended the day down nearly 3%. So no change in trend there. Then looking at Meta, Meta came into yesterday on a sell signal. It is certainly on a sell signal now. Down sharply in the pre market, down $65 $70, depending on when you blink. And then we also had IBM, which came into yesterday on a sell signal, is down another $15 $16, $17 in the premarket this morning. And Amazon, which is on a sell signal, is down $4 or so in the pre market.
It was down $2.95 yesterday, down another $4 or so in the pre market. Now commodities. I wanted to spend a little more time on commodities this morning than I’m going to, so I apologize for that. We’ve got lumber hitting a new high yesterday before pulling back, so that’s not good for the inflation picture. And of course, this is house building season and a lot of upward demand for lumber at this time of the year. Then cocoa, chocolate still on a buy signal here. Making a new high a couple of days ago, so that’s not helpful if you want to eat some chocolate. Coffee still on a buy signal here. So upward pressure on coffee prices, that could change on Thursday with a close below $220.12. Then at the other end of the scale, you’ve got cotton making a new low a few days ago, so still on a sell signal. So underwear prices shouldn’t be going up anytime soon. Sugar, another commodity on a sell signal, making a new low a few days ago, so no change in trend there. Now, when it comes to the stock market, of course, there’s gold, there’s crude oil.
Crude oil is the big player, of course, and it affects all of us with energy prices, gasoline prices. Crude oil still on a sell signal. Trading in the channel yesterday, it stuck between $87.50 and $81.25. The market is looking for some catalysts to take it out of that. We are coming into driving season. And of course, any international incident could spark a sharp move up in crude oil prices. The pros currently look like they want to give up control of the price of crude oil. That could certainly happen. If it takes it down below $81.25, that’s going to put more downward pressure on energy stocks now natural gas, which is not an international commodity, it’s more localized so it doesn’t react as much to international events. It’s currently on a buy signal but it’s not going anywhere. Still stuck to the $2.34 level. Pros look like they’re giving up control once again. So really no enthusiasm for natural gas at the present time. Now energy stocks, a lot of them are on short term sell signals right now. Of course, there has not been enough damage to affect long term charts just yet. Energy stocks were up yesterday in the US and you can see we need to close above $96.27. We closed at $96.19 for the XLE.
So no new buy signal there. Now I’m going to say this, any new buy signals and energy stocks right now are high risk trades. I wouldn’t take them. All the easy money in the energy sector has been made. I’d rather wait for a major pullback or not a major pullback, but something that lasts several weeks or several months before I jump back in. If we look at Marathon Petroleum, it’s on a sell signal. Marathon Oil is on a sell signal. A lot of stocks look like that. On the other hand, a lot of stocks look like the index itself, like Exxon. And there’s Exxon generating a new buy signal. But we’re up here at the top of the Panic Zones again. It’s a high risk buy signal. Yeah, we might go back up to the recent high. You can see Kinder Morgan exploded the other day with a new buy signal and it hasn’t gone anywhere since then. So I’m really not enthusiastic about taking new buy signals in the energy sector right now. Looking at the Canadian Energy sector, similar situation. We’re treading water here. We’re right on the edge of technically a new daily buy signal, but not something I want to take.
Canadian Natural Resources still on a sell signal. Then looking at Cenovus, we’re still on a buy signal here. We traded in the channel for a week but have not closed below it. Then looking at Crescent Point again, another stock that recently generated a buy signal. Not something I want to chase at the moment. And then looking at Meg Energy, we’re still on a sell signal here. And last up looking at Suncor. Yeah, we’re back on a buy signal a couple of days ago, but again, we haven’t been able to make a new high just yet. And really again, not something I want to chase up here. If I recently got out, all the easy money was made off the bottom of the panic zones and you should just lock in those profits and sit on your hands for a while. You don’t have to take every buy signal that shows up. Okay folks, that’s all for this morning’s presentation. Lots of pre market activity this morning. I see Microsoft’s down down $8. I see Newmont’s up $2 this morning. So the volatility is going to expand dramatically on Thursday. And of course we’re doing this ahead of those economic numbers coming out at 8:30 this morning.
That could certainly add to the volatility. Have a great day. Next time you’ll hear my voice is on Friday morning and at Friday morning I’ll take a closer look at the gold sector.
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Stephen Whiteside
TheUpTrend.com
Thursday, April 25, 2024
