Tech Talk for Thursday December 6th 2018

U.S. equity index futures were lower this morning. S&P 500 futures were down 39 points in pre-opening trade. Index futures are responding to the arrest in Canada of Huawei's Chief Financial Officer in response to a request by U.S. officials.

Index futures were virtually unchanged following release of economic news at 8:30 AM EST. Consensus for the U.S. October trade deficit was $55 billion. Actual was a deficit of $54.56 billion. Consensus for Weekly Jobless Claims was 225,000 versus 235,000 last week. Actual was 231,000.

Notably weaker were U.S. stocks such as Apple and Caterpillar that have extensive Chinese operations.

WTI Crude Oil dropped $1.37 to $51.52 prior to a decision on oil production by OPEC. Consensus is that OPEC will reduce production by at least 1 million barrels per day to stabilize prices.

Kroger (KR $28.64) is expected to open lower despite reporting higher than consensus third quarter sales and earnings.

Facebook dropped $3.32 to 134.01 after Stifel Nicolaus downgraded the stock to Hold from Buy.

Netflix fell $5.18 to $270.15 after Stifel Nicolaus lowered its target price to $380 from $474.

H&R Block (HRB $) is expected to open higher after the company reported better than consensus fiscal second quarter revenues and earnings.

StockTwits Released Yesterday @EquityClock

Another Canadian base metal stock breakout! Teck Resources $TECK.B.CA moved above $39.48 Cdn. completing a base building pattern.

'Tis the season for strength in base metal stocks to spring. ZMT.CA

Laurentian Bank $LB.CA moved below $40.25 extending an intermediate downtrend despite a dividend increase, but lower than consensus Q4 EPS.

Canadian Dollar $CDW.CA moved below U.S. 74.70 cents to 74.67 extending an intermediate downtrend following Bank of Canada statement.

'Tis the season for weakness in the Canadian Dollar!

Trader's Corner

Equity Indices and related ETFs

Daily Seasonal/Technical Equity Trends for December 5th 2018

Green: Increase from previous day

Red: Decrease from previous day

Commodities

Daily Seasonal/Technical Commodities Trends for December 5th 2018

Green: Increase from previous day

Red: Decrease from previous day

Sectors

Daily Seasonal/Technical Sector Trends for December 5th 2018

Green: Increase from previous day

Red: Decrease from previous day

Interesting observation on gold/gold stocks by National Bank

PRECIOUS METALS: Seasonality Analysis – Seasonal Gold Rally Could Present a Golden Opportunity

Event: We take a look at the gold New Year rally driven by Chinese demand that has been a fairly consistent trend over the past five years, often leading to major price gains for the precious metal producers.

Key Takeaways: In this report we look at how Chinese demand influences gold prices heading into the Chinese New Year, which in 2019 is on February 5. The gifting of gold has long been tied to the Chinese New Year and we believe this is the primary driver behind the recent strong gold rallies in the December-January period realized since 2012. In the past several years we

have seen a bottom for the gold price in mid-December, followed by a relatively consistent short term rally into the early New Year. In our opinion, the best names to own for the potential December 2018-January 2019 gold rally are Agnico Eagle, IAMGOLD, Kirkland Lake and Yamana. In our view, the reason we believe some of the other higher NAV leveraged names may not perform as well as the four names listed above are for geopolitical reasons and/or the companies having a "show-me story" challenge that we believe are overhanging the stocks.

Editor's Note: Agreed with the above comment! Gold and gold stocks have struggled recently due partially to tax loss selling pressures. These pressures likely will abate after mid-December when the typical period of seasonal strength from mid-December to the end of February arrives. Note that the National Bank analyst prefers Canadian producers. Recent weakness in the Canadian Dollar supports the preference. Canadian producers produce in Canadian Dollars and sell in U.S. Dollars. Owning a basket of the above stocks makes sense as their period of seasonal strength begins to show on the charts during the next couple of weeks.

World Outlook Conference

Tech Talk is looking forward to presenting at Michael Campbell's World Outlook Conference in Vancouver on February 1st and February 2nd. Lots of good speakers this year including my buddies Josef Schachter, John Johnston and Mark Leibovit!

Following is a link describing the conference:

http://moneytalks.net/events/world-outlook-conference-2019.html?mc_cid=f695ed769a&mc_eid=592546b4b5

Conference Details

When: Friday afternoon and evening, February 1st and all day Saturday, February 2nd, 2019

Where: Westin Bayshore Conference Centre, Vancouver BC
To Book Your Ticket:  CLICK HERE or go to moneytalks.net

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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