Vialoux's Technical Talk – December 16, 2014

December 16, 2014

3 minute read

Pre-opening Comments for Tuesday December 16^th

U.S. equity index futures were lower this morning. S&P 500 futures were down 9 points in pre-opening trade. Futures are responding to currency uncertainties related to additional weakness in the Russian Ruble despite a 6.5% increase to 17% in Russia’s Central Bank rate overnight.

Index futures were unchanged following release of the November Housing Starts report. Consensus was 1,035,000 units versus an upwardly revised 1,045,000 units in October. Actual was 1,028,000 units

Boeing added $2.12 to $124.20 after increasing its dividend by 25% and after announcing an additional share buyback program.

MMM gained $1.65 to $158.50 after announcing a 20% dividend increase.

Bank of America (BAC $16.76) is expected to open higher after Guggenheim and FBR Capital upgraded the stock.

Dow Chemical (DOW $43.23) is expected to open higher after Nomura initiated coverage with a Buy rating. Target is $57

Talisman jumped $2.50 to $7.62 after receiving an $8 per share cash takeover offer from Repsol.

Methanex (MX $12.65) is expected to open higher after TD Securities upgraded the stock to Buy from Hold. Target is $60.

Microsoft fell $0.63 to $46.04 after Bank of America/Merrill downgraded the stock to Under Perform from Neutral. Target is $47.

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2014/12/15/stock-market-outlook-for-december-16-2014/

Interesting Charts

The Dow Jones Industrial Average and S&P 500 Index fell below their 50 day moving average.

Percent of S&P 500 stocks trading above their 50 day moving average plunged accordingly

Intermediate trend for the TSX Composite Index changed to down from neutral when the Index fell below its October 15^th low.

One of the reasons for weakness in North American equity markets yesterday was a virtually meltdown by the Russian ruble and the Russian stock market. The ruble dropped 12%. The Russian Central Bank announced an increase in its lending rate to 17%.

StockTwit released yesterday

Surprisingly quiet technical action by S&P 500 stocks to 10:30 AM. $PETM broke to a new high on a takeover bid. No intermediate breakdowns.

Technical Action by Individual Equities Yesterday

Technicals for S&P 500 stocks rapidly changed after 10:30 AM. 25 S&P 500 stocks broke intermediate support levels.

Trader’s Corner

Weakness in markets triggered lots of changes in technical parameters for equity indices, commodities and sectors yesterday

Equity Markets

Commodities

Sectors

FP Trading Desk Headline

FP Trading Desk headline reads, “Canadian banks could take up to a 7% earnings hit from exposure to oil”. Following is a link:

http://business.financialpost.com/2014/12/15/canadian-banks-could-take-up-to-7-earnings-hit-from-exposure-to-oil/?__lsa=ad30-1eca

Special Free Services available through www.equityclock.com

Equityclock.com is offering free access to a data base showing seasonal studies on individual stocks and sectors. The data base holds seasonality studies on over 1000 big and moderate cap securities and indices. To login, simply go to http://www.equityclock.com/charts/

Following is an example:

FUTURE_HG1 Relative to the S&P 500

FUTURE_HG1 Relative to Gold

Monitored List of Technical/Seasonal Ideas

Stock Date of selection Price at selection Dec.15 Price Technical Score

DHR Oct.21 74.73 83.39 2.0

Green: Increased score

Red: Decreased score

A score of 1.5 or higher is needed to maintain a position

Disclaimer: Comments, charts and opinions offered in this report by www.timingthemarket.ca and www.equityclock.com are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed. Don and Jon Vialoux are Research Analysts with Horizons ETFs Management (Canada) Inc. All of the views expressed herein are the personal views of the authors and are not necessarily the views of Horizons ETFs Management (Canada) Inc., although any of the recommendations found herein may be reflected in positions or transactions in the various client portfolios managed by Horizons ETFs Management (Canada) Inc.

Individual equities mentioned in StockTwits are not held personally or in HAC.

Horizons Seasonal Rotation ETF HAC December 15^th 2014

Author

Don Vialoux, EquityClock.com

Don Vialoux is the author of free daily reports on equity markets, sectors, commodities and Exchange Traded Funds. All of the views expressed herein are his personal views although they may be reflected in positions or transactions in the various client portfolios. Daily reports are available at http://www.timingthemarket.ca.