TSX Composite - Stay out of the way in the Summer Heat

Yesterday's 214 point drop in the Toronto Composite index caused some anxiety, the market came back 74 points today, let's look at the daily chart, should we be worried? I drew all these trend lines to make a point, it is hard to tell where the market is going, seems to be all over the place since the beginning of the year, however since April we are clearly moving lower. Maybe the weekly chart will provided another clue.

Below is the weekly chart for the Toronto stock exchange composite index, the nice upwards trajectory of 2013 through 2014 is clearly over. the index is locked in a trading range of about 2000 points since the all-time highs of September 2014, the stronger market in April was not able to break back up to that level and has since sold off. It is difficult to project where this market may take us, with that in mind a sideways market is perhaps the path of least resistance at the moment. For the most part after a sideways trend the previous trend would tend to take hold again.

With all that being said, there does not seem to be a compelling direction or reason to do much of anything over the next few months when looking at the Toronto market as a whole. Save some cash, write some call options to raise more cash and wait for the trend to resolve. Looks like a big old rattle snake undulating up and down....but moving in a straight line to no where in particular.

SPY - Hanging in There

The SPDRs are hanging in there today, coming up off the lows of the day near 209, looks like a good short -term support level is developing at 209 (about the blue line on the chart). Progress has been slow and steady since the beginning of February, it would be nice to see support hold and a progress resume.

Below is the weekly chart, wow that looks good, moving up nicely in a well defined channel, SPY could drop to about 190 before longer-term concerns set in.

Consolidation Zone? Is the S&P 500 Looking for Answers, Along with Seahawk Fans

The above chart is for the SPY ETF, it tracks the S&P 500. The market swings since the beginning of December are leaving people scratching their heads, much like Seattle Seahawk fans. "What is going on, which way is this thing going?"

Well, the daily chart does not give much of a clue, the market is in a narrowing consolidation zone, a break-out either side of the channel will provide some guidance. But.....

...the weekly chart looks darn good. The longer term trend is intact, periods of consolidation tend to be continuation patterns, meaning that if the trend was up before it is likely to go up again. So, if the daily chart breaks to the upside, look for fair weather ahead, if it breaks down again past 195, be concerned about a longer term down trend developing.

Like the Seahawks, there has been a recent storm, but if they come out strong again next year I like their chances to be back in the big game. Can't be perfect all the time, at least that is what my wife keeps trying to  tell me ; ) Go Hawks Go!

TSX, Beaten Down Hard, Getting Up from the 10 Count?

The Toronto Stock exchange has taken a beating the past 6 weeks, the question is are we in for more? Let's take a look at the weekly chart. In the chart below it would have been nice to find support where the downward arrow is pointing, but that has been broken. The next level of substantial support is around the 12,900 level....remember how much trouble we had breaking out from there, you can see it in the chart and the line that has the upward arrow pointing to it.

However, the daily chart has some encouraging signs. RSI has turned up, the upwards pointing arrow....and we had a positive outside day, meaning the positive candlestick chart engulfed the previous day. Outside days when the market is positive are nice signs to see. We may have a little more to go, but signs are starting to point to an end of the carnage, the TSX is getting to it's knees on the 6 count...

TWTR - Twitter Trending Up in a Dicey Market

Twitter is trending, like their popular hashtags, the company is making some noise in this difficult market. Yesterday there was some indecision with a imperfect Doji Star candlestick pattern, today the price was up in a volatile, negative market. The 50 day moving average crossed the 200 day a couple weeks ago and the RSI is trending up, all positive signs in a tough market. So what gives?

Well, it looks to me that Twitter has some strong support in the mid 40 range, that is where it closed after the first day of trading, that brings us to the weekly chart.

Way on the left hand side you can see that first week of trading in TWTR. It has been almost a year....almost a year you say, isn't that when many portfolio managers say they start to look at companies. Hmmm, perhaps more interest is developing ahead of the anniversary, especially considering that TWTR has recovered nicely since the summer. 

Given the tough market maybe add a small position and see if it continues to beat this recent negative market.