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Good morning, everyone, and welcome to Friday Morning. It’s Stephen Whiteside here from theuptrend.com. In the pre market this morning, things are fairly quiet. We are coming up to employment numbers coming out at 830 this morning, and that could certainly add some volatility to the pre market trading action. Looking at yesterday’s trading action, the VIX was able to trade above the previous high, but did not hold those gains.
In fact, it closed slightly lower on the day. So we were able to trade above the top of the Fly Paper Channel, but we didn’t really hold those gains at all. We were looking for movement up above $17. Got as high as 17.42 before closing just below $16. Now, a lot of movement is still happening in the bond market, and I’m not sure what the bond market is trying to tell us.
I’m not sure anybody is, but they are certainly very aggressive in their actions. There’s the XBB on the TSX, there’s the TLT, and the 30 year bond. And the 30 year bond year yield now looks like that, which of course, is not helpful to the real estate market going forward. So that could certainly put a big damper on the economy if the real estate market starts to pull back aggressively. Now, yesterday we talked about the fact the market was probably on pause, waiting for earnings from Apple and Amazon.
That has now happened, and they basically cancel each other out. Apple’s earnings were taken negatively. It’s trading down in the pre market while Amazon’s earnings were taken positively. And it is popping in the pre market trading this morning. So we’re coming in and we’re on a sell signal right now.
So our next price target is 137.50 and then 143 75. I certainly wouldn’t chase Amazon up at these levels. I believe it’s probably going to be a short term pop. And the stock, no matter how well it holds up, is still going to be pulled down during August and September. Then looking at the Ishares for the TSX 60 we traded down filled a gap.
Trying to hold 30.47. If we don’t hold that, then 30.08 would be our next target to the downside. Looking at the Dow, it is back on a sell signal as of Thursday’s close, joining the S&P 500, the Nasdaq, and the semiconductors. Already on daily sell signals. Looking at commodity prices, crude oil moved up yesterday.
Gasoline was down on the day, sitting right on the edge of a new daily sell signal. Just a couple of pennies to go. And then natural gas popped yesterday. It’s holding support at 6.64. We’re looking to see if we can get over 7.03.
If we get over 7.03, that takes us back to 7.42. Then looking at the major energy ETFs, starting with the XLE, we were up just a little over 1% yesterday. Our next price target is 87 50. I may have misspoke on Thursday and said 67.50. And once again, we hit it on Thursday.
Looking at oil and gas equipment makers, the explorers, the small caps, and the TSX listed energy stocks. They were all up on Thursday. Now, we know that energy stocks are doing well. We know that crude oil is up. We know that technology stocks have been doing well.
You’d think clean technology stocks would be doing well. Well, that’s not the case. Now. When I saw this chart, I decided to go and look and see how some of the alternative energy ETFs were doing. And looking at global wind, not doing well, looking at global clean energy, not doing well right now.
And you can see this particular ETF has not been doing well in 2023 with a series of lower highs and lower lows. Now there are some ETFs in the alternative energy space that are doing well right now. Well, so much for my intuition. You would think that with energy prices trending sharply higher, energy stocks trending sharply higher, technology stocks trending sharply higher, that clean technology stocks would also be trending sharply higher. And that is certainly not the case.
Now, the price of gold was down yesterday. It’s fairly stable in the pre market this morning. Price of silver was also lower. When we look at the gold and silver stocks, the GDX actually closed unchanged on Thursday. We saw the Ishares for the TSX global gold index down a little over a quarter of a percent, and a little more aggressive selling for silver miners, down nearly three quarters of a percent.
But a fairly quiet day overall for the gold and silver mining stocks. Now, we’re almost done. Let’s take a look at some big cap technology stocks, starting with PayPal, which was down sharply yesterday. Hopefully you locked in some profits along the way. We traded up to previous resistance.
Another early warning signal up there. The 200 day moving average looks like it played a role once again, which it did back earlier in the year. So that could have been a legitimate target to the upside. Or you could have used our price targets. 68, 75 was the first one.
And then we move up into the gap, 71.88, then 75. We were able to go up and fill that open gap and trade slightly above 75 for a couple of days before coming down. So you’ve had several opportunities to lock in profits along the way, and you should have just a partial position left. Of course, you’re going to sell that at the open on Friday morning. Then looking at shopify, we’re coming down to our next price targets and we’re going to be looking to see if we can hold support in New York at 56.25, in Toronto at $75.
Now, if we break those, there’s a nice open gap there from early May. And if we look at the panic zone chart, if we go down to retest the top of that gap, that’s going to take us down to a reasonable projection, to the downside. If we’re going to go down and fill the gap, that would be more panic selling, and that would certainly be a very negative sign for the overall technology sector if shopify were to get down to those levels. It’s certainly possible in August and September. We’ll just have to wait and see.
But those are potential targets to the downside. Looking at Arc innovations, the ARK ETFs are all back on sell signals right now with the rest of the market. Notice that we put in a lower high last week. And the ARK. ETF that’s getting hit the hardest right now is the Genomics ETF, which was down sharply the last couple of days. And then let’s finish off with Lightspeed.
Lightspeed had a wild day yesterday, making a new low before reversing and closing just above the upper channel line. It’s trading down slightly in New York. Last time I looked, it was down .25, $0.30. That, of course, can change. Whether you take the buy signal or not is up to you.
I would certainly wait for the next close above the upper channel line to see if these investors know what they’re doing at this time. Okay, folks, that is all for Friday morning. I see the employment numbers have come out, and I see stock index futures have not changed that much. Enjoy the rest of your day. Next time you’ll hear my voice is on Sunday.
Stephen Whiteside
Friday, August 4, 2023
