Tech Talk for Friday January 11th 2019

U.S. equity index futures were lower this morning. S&P 500 futures were down 8 points in pre-opening trade.

Index futures drifted lower following release of the U.S. December Consumer Price Index at 8:30 AM EST. Consensus was a drop of 0.1% versus no change in November. Actual was a drop of 0.1%. Excluding food and energy, consensus was an increase of 0.2% versus a gain of 0.2% in November. Actual was an increase of 0.2%. The U.S. Dollar Index also drifted lower following release of the December CPI report.

Alcoa (AA $28.98) is expected to open lower after JP Morgan lowered its target price to $57 from $79.

Weight Watchers (WTW $35.08) is expected to open lower after JP Morgan downgraded the stock to Neutral from Overweight.

Starbucks dropped $1.72 to $62.47 after Goldman Sachs downgraded the stock to Neutral from Buy sighting a slowdown in sales in China.

Netflix gained $8.58 to $333.35 after Raymond James upgraded the stock to Strong Buy from Outperform. Target was increased to $450 from $425.

EquityClock's Daily Market Comment

Following is a link:

http://www.equityclock.com/2019/01/10/stock-market-outlook-for-january-11-2019/

Note seasonality chart on the Biotech industry.

Observations

Encouraging technical action in China sensitive ETFs! Nice breakout by $EWH above $22.53 completing a reverse Head & Shoulders pattern.

StockTwits Released Yesterday @EquityClock

Technical action by S&P 500 stocks to 10:00: Quiet. No intermediate breakouts. Breakdown: $EL

After 10:00 AM EST, intermediate breakouts included BBBY, MGM and EBAY

Cogeco Cable $CCA.CA moved above $67.96 completing a base building pattern.

Chile iShares $ECH moved above $44.28 completing a double bottom pattern. Highly correlated with copper stocks!

eBay $EBAY moved above $30.36 completing a double bottom pattern.

'Tis the season for eBay $EBAY to move higher to the end of April!

CGI Group $GIB $GIB.A.CA, a TSX 60 stock moved above $64.90 U.S. extending an intermediate uptrend.

Editor's Note: CGI Group was selected yesterday on BNNBloomberg's Market Call by Hap Sneddon of CastleMoore as a Top Pick

Rogers Communications $RCI $RCI.B.CA , a TSX 60 stock moved above $54.46 U.S. to an all-time high extending an intermediate uptrend.

Loblaw Companies $L.CA, a TSX 60 stock moved above $62.89 to an all-time high extending an intermediate uptrend.

Interfor $IFP.CA moved above $16.07 completing a double bottom pattern.

'Tis the season for Interfor $IFP.CA and other forest product stocks to move higher to the end of April.

Hap Sneddon on BNN Bloomberg Yesterday

Following are links:

Market Comment

https://www.bnnbloomberg.ca/video/hap-sneddon-s-market-outlook~1583499

Top Picks

https://www.bnnbloomberg.ca/video/hap-sneddon-s-top-picks~1583502

Past Picks

https://www.bnnbloomberg.ca/video/hap-sneddon-s-past-picks~1583500

Top Pick

Early this week, Investors Digest asked Tech Talk for a Top Pick. Publication of comments is available starting today for subscribers. See www.adviceforinvestors.com. The base metal sector was selected as a Top Pick for a seasonal trade lasting to the end of April. Following is quick summary of comments:

Fundamental prospects are improving. Inventory levels for copper and zinc are at or near multi-year lows. Largest user of base metals is China. A trade agreement between China and the U.S. will set the stage for a surge in demand for base metals.

Seasonal influences for base metal prices and base metal equity prices turn positive in mid-January for a seasonal trade lasting to the end of April.

Technical picture for base metals and base metal equities is showing early signs of improving prior to start of its period of seasonal strength despite difficult North American equity indices since the beginning of October. Prices have moved lower, but strength relative to the S&P 500 and TSX Composite has been positive since the beginning of December.

Recent completion by the U.S. Dollar Index of a double top pattern is positive for commodity prices in general including base metal prices.

Easiest way to invest in the sector is through Exchange Traded Funds:

Commodity:

Copper futures based ETF:JJCTF

Equities:

U.S.: PICK COPX

Cdn: XBM ZMT

Trader's Corner

Equity Indices and related ETFs

Daily Seasonal/Technical Equity Trends for January 10th 2019

Green: Increase from previous day

Red: Decrease from previous day

Commodities

Daily Seasonal/Technical Commodities Trends for January 10th 2019

Green: Increase from previous day

Red: Decrease from previous day

Sectors

Daily Seasonal/Technical Sector Trends for January 10th 2019

Green: Increase from previous day

Red: Decrease from previous day

2019 World Outlook Financial Conference

Tickets Still Available
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S&P 500 Momentum Barometer

The Barometer added another 9.00 to 40.00 yesterday. It continues to recover and has moved from Intermediate Oversold to Intermediate Neutral

TSX Momentum Barometer

The Barometer advanced another 5.35 to 60.91 yesterday. It continues to trend higher and has moved from Intermediate Oversold to Intermediate Overbought on a move above 60%.

http://www.equityclock.com/about/seasonal-advantage-portfolio/

Editor's Note: Tech Talk invested in the Seasonal Advantage Portfolio at the end of October. The Fund is managed by Jon Vialoux at CastleMoore. Since the end of October, the Fund has been on a rollercoaster ride. However, owning equities with positive seasonal trends that are outperforming the market has proven to be a relatively successful strategy despite difficult conditions. Consider the following returns since the end of October:

S&P 500 Index: -4.26%

Dow Jones Industrial Average: -4.43%

NASDAQ Composite Index: -4.38%

Other Seasonal Fund: -2.18%

TSX Composite Index: -0.82%

Unofficial Seasonal Advantage Portfolio: -0.37%

Disclaimer: Seasonality and technical ratings offered in this report and at

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

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