Tech Talk for Monday April 20th 2020

U.S equity indices lower in pre-opening trade. S&P 500 futures were down 56 points in pre-opening trade.

May Crude Oil futures plunged $6.58 to a 21 year low at $11.59 per barrel. Energy equity prices are leading U.S. equity index futures to the downside.

Dupont added $1.64 to $39.95 after noted that first quarter earnings will exceed consensus estimates.

Boeing dropped $6.01 to $147.99 after Benchmark reduced its target price from $375 to $180.

EquityClock's Daily Market Comment

Following is a link:

http://www.equityclock.com/2020/04/18/stock-market-outlook-for-april-20-2020/

The Bottom Line

Equity markets continued to recover last week from the "Black Swan" coronavirus event . Spread of the coronavirus remains a major influence on equity prices. The VIX Index remained elevated but appears to have passed an intermediate peak. World equity markets generally remain intermediate oversold and continue to show short term technical signs of strength

Observations

The VIX Index (better known as the Fear Index) remains elevated, but appears to have peaked, typical of a recovery phase for the U.S. equity market.

Medium term technical indicators for U.S. equity markets (e.g. Percent of S&P 500 stocks trading above their 50 day moving average) remain oversold and trending higher. See end of this report for chart.

Medium term technical indicators for Canadian equity markets also remain oversold and trending higher. See end of this report for chart.

Most short term short term momentum indicators for U.S. markets and sectors (20 day moving averages, short term momentum indicators) were mixed last week. Selected sectors remained above their 20 day moving average, but short term momentum indicators turned mixed.

Short term momentum indicators for Canadian markets and sectors also were mixed last week. Technology and base metals were notably stronger while financials, energy and gold were notably weaker.

Year-over-year consensus earnings for S&P 500 companies were reduced significantly again last week in recognition of a greater impact from the coronavirus. According to FactSet, first quarter 2020 earnings are expected to drop 14.5% (versus a decline of 10.0% last week) and revenues are expected to increase 0.6% (versus an increase of 1.0% last week). Second quarter 2020 earnings are expected to fall 26.6% (versus a drop of 20.0% last week) and revenues are expected to drop 5.7% (versus a drop of 3.8% last week). Third quarter earnings are expected to fall 13.3% (versus a fall of 8.5% last week) and revenues are expected to decrease 1.6% (versus a decline of 0.4% last week). Fourth quarter earnings are expected to decrease 4.8% (versus a decrease of 8.5% last week) and revenues are expected to increase 1.1% (versus a gain of 1.9% last week). Earnings for all of 2020 are expected to decrease 12.3% (versus a previous decrease of 8.5%) and revenues are expected to decrease 1.2% (versus a previous decrease of 0.1%).

Economic News This Week

Canadian February Retail Sales to be released at 8:30 AM EDT on Tuesday are expected to increase 0.3% versus a gain of 0.4% in January. Excluding auto sales, Canadian February Retail Sales are expected to increase 0.2% versus a decline of 0.1% in January.

March U.S. Existing Home Sales to be released at 10:00 AM EDT on Tuesday are expected to drop to 5.30 million units from 5.77 million in February.

March Canadian Consumer Price Index to be released at 8:30 AM EDT on Wednesday is expected to increase 0.4% versus a gain of 0.4% in February. Excluding food and energy, March Canadian Consumer Price Index is expected to versus a gain of 0.7% in February.

March U.S. New Home Sales to be released at 10:00 AM EDT on Thursday are expected to drop 15.7% versus a decline of 4.4% in February.

March Durable Goods Orders to be released at 8:30 AM EDT on Friday is expected to drop 11.8% versus a gain of 1.2% in February. Excluding Transportation Orders, March Durable Goods Orders are expected to drop 5.0% versus a decline of 0.6% in February.

April Michigan Consumer Sentiment Index to be released at 10:00 AM EDT on Friday is expected to drop to 68.0 from 71.0 in March.

Selected Earnings News This Week

Another 96 S&P 500 companies (including six Dow Jones Industrial companies) are scheduled to report quarterly results this week

Trader's Corner

Equity Indices and related ETFs

Daily Seasonal/Technical Equity Trends for April 17th 2020

Green: Increase from previous day

Red: Decrease from previous day

Commodities

Seasonal/Technical Commodities Trends for April 17th 2020

Green: Increase from previous day

Red: Decrease from previous day

Sectors

Daily Seasonal/Technical Sector Trends for April 17th 2020

Green: Increase from previous day

Red: Decrease from previous day

Technical Scores

Calculated as follows:

Intermediate Uptrend based on at least 20 trading days: Score 2

          (Higher highs and higher lows)

Intermediate Neutral trend: Score 0

          (Not up or down)

Intermediate Downtrend: Score -2

          (Lower highs and lower lows)

Outperformance relative to the S&P 500 Index: Score: 2

Neutral Performance relative to the S&P 500 Index: 0

Underperformance relative to the S&P 500 Index: Score -2

Above 20 day moving average: Score 1

At 20 day moving average: Score: 0

Below 20 day moving average: -1

Up trending momentum indicators (Daily Stochastics, RSI and MACD): 1

Mixed momentum indicators: 0

Down trending momentum indicators: -1

Technical scores range from -6 to +6. Technical buy signals based on the above guidelines start when a security advances to at least 0.0, but preferably 2.0 or higher. Technical sell/short signals start when a security descends to 0, but preferably -2.0 or lower.

Long positions require maintaining a technical score of -2.0 or higher. Conversely, a short position requires maintaining a technical score of +2.0 or lower

Changes Last Week

StockTwits released on Friday @EquityClock

Biotech ETF $BBH moved above $96.79 resuming an intermediate uptrend. Strength in $GILD was a major contributor.

Editor's Note: Ditto for $IBB on a move above $123.85

Incyte $INCY, a NASDAQ 100 stock moved above $96.79 resuming an intermediate uptrend.

Activision $ATVI, a NASDAQ 100 stock moved above $64.11 resuming an intermediate uptrend

Canadian Tire $CTC.A.CA, a TSX 60 stock moved above $98.39 completing a base building pattern.

S&P 500 Momentum Barometer

The Barometer added another 15.34 to 39.48 last week. It remains intermediate oversold and trending higher.

TSX Momentum Barometer

The Barometer added another 8.79 to 30.53 last week. It remains intermediate oversold and trending higher.

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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