Tech Talk for Tuesday August 8th 2023
U.S. equity index futures were lower this morning. S&P 500 futures were down 33 points at 8:35 AM EDT.
Index futures were unchanged following release of the U.S. June Trade Balance at 8:30 AM EDT. Consensus was a deficit of $65.70 billion versus a deficit of $69.00 billion in May. Actual was a deficit of $65.5 billion
Palantir added $0.26 to $18.25 after offering positive revenue guidance. The company also announced a $1 billion share buyback program.
Eli Lilly gained $39.69 to $493.77 after reporting higher than consensus second quarter results.
![clip_image002[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2023/08/clip_image0021-3.png "clip_image002[1]")
Paramount jumped $0.60 to $16.69 after announcing sale of its Simon & Shuster division for $1.62 billion.
Restaurant Brand International (QSR.TO Cdn$94.34) is expected to open higher after reporting higher than consensus second quarter revenues and earnings.
![clip_image004[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2023/08/clip_image0041-3.png "clip_image004[1]")
EquityClock's Daily Comment
Headline reads "During Pre-Election years, bonds perform particularly well between now and the start of October".
http://www.equityclock.com/2023/08/05/stock-market-outlook-for-august-8-2023/
Hap Sneddon from CastleMoore on BNNBloomberg today
He is on Market Call at Noon today.
Highlighted Technical Action in U.S. equity markets yesterday
Notably higher were Wal-Mart and Berkshire Hathaway. Both moved to an all-time high.
![clip_image006[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2023/08/clip_image0061.png "clip_image006[1]")
The Bottom Line
North American equity indices reached an intermediate peak on or about July 27th. Thereafter, volatility increased significantly as prices moved lower. The period for increased volatility in North American equity markets has arrived. Intermediate downside risks exists between now and mid-October.
Consensus for Earnings and Revenues for S&P 500 Companies
Source: www.Factset.com
Earnings estimates improved again last week after 84% of S&P 500 companies reported second quarter results. Consensus for the second quarter earnings currently calls for a year-over-year drop of 5.2% (versus a drop of 7.3% last week). Second quarter revenues are expected to increase 0.6% (versus a gain of 0.1% last week). Consensus for the third quarter calls for an earnings increase of 0.2%. Third quarter revenues are expected to increase 1.3% (versus a gain of 1.1% last week). Consensus for the fourth quarter calls for a 7.6% increase in earnings (versus a gain of 7.5% last week). Fourth quarter revenues are expected to increase 3.4% (versus a gain of 3.2% last week). For all of 2023, consensus calls for an earnings increase of 0.8% (versus a gain of 0.4% last week). Revenues are expected to increase 2.5% (versus a gain of 2.4% last week).
The recovery in earnings continues into 2024. Consensus for 2024 calls for a 12.2% increase in earnings (versus previous estimate at 12.6%). Consensus for revenue growth calls for a 5.1% increase (versus 5.0% last week).
Economic News This Week
Source: www.investing.com
Canadian June Merchandise Trade Balance is released at 8:30 AM EDT on Tuesday. Balance was a deficit of $3.44 billion in May.
U.S. June Trade Balance released at 8:30 AM EDT on Tuesday is expected to be a deficit of $65.70 billion versus a deficit of $69.00 billion in May.
U.S. July Consumer Price Index released at 8:30 AM EDT on Thursday is expected to increase 0.2% versus a gain of 0.2% in June. Core July CPI is expected to increase 0.2% versus a gain of 0.2% in June. On a year-over-year basis, core CPI is expected to increase 4.7% versus a gain of 4.8% in June.
U.S. July Producer Price Index released at 8:30 AM EDT on Friday is expected to increase 0.2% versus a gain of 0.1% in June. Core July PPI is expected to increase 0.2% versus a gain of 0.1% in June
August Michigan Consumer Sentiment released at 10:00 AM EDT on Friday is expected to slip to 70.9 from 71.6 in July.
Selected Earnings News This Week
Source: www.investing.com
Another 34 S&P 500 companies are scheduled to report quarterly results this week (including one Dow Jones Industrial company: Disney).
Another eight TSX 60 companies are scheduled to report quarterly results this week.
Trader's Corner
Equity Indices and Related ETFs
Daily Seasonal/Technical Equity Trends for August 4th 2023
Green: Increase from previous day
Red: Decrease from previous day
Source for all positive seasonality ratings: www.EquityClock.com
Commodities
Daily Seasonal/Technical Commodities Trends for August 4th 2023
Green: Increase from previous day
Red: Decrease from previous day
Sectors
Daily Seasonal/Technical Sector Trends for August 4th 2023
Green: Increase from previous day
Red: Decrease from previous day
Chart of the Day
The VIX Index (a measure of implied volatility for S&P 500 stocks) spiked higher this week.
'Tis the season for volatility to spike higher between late July and early October (Particularly when the S&P 500 is Overbought and price momentum is trending down).
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
Technical Notes for Friday
Solar ETF $TAN moved below $62.97 extending an intermediate downtrend.
Amazon.com $AMZN a NASDAQ 100 stock moved above $136.65 extending an intermediate uptrend. The company reported higher than consensus second quarter results.
Apple $AAPL a Dow Jones Industrial Average stock moved below $191.23 and $186.60 setting an intermediate downtrend.
CSX $CSX a NASDAQ 100 stock moved below $31.83 completing a double top pattern.
Southern Companies $SO an S&P 100 stock moved below $68.59 extending an intermediate downtrend.
Electronic Arts $EA a NASDAQ 100 stock moved below intermediate support at $122.75.
Monster Beverages $MNST a NASDAQ 100 stock moved below $55.28 extending an intermediate downtrend.
Open Text $OTEX a TSX 60 stock moved below Cdn$52.35 and US$39.54 completing a double top pattern.
CCL Industries $CCL.B.TO a TSX stock moved below $60.89 extending an intermediate downtrend.
Cenovus Energy $CVE.TO a TSX 60 stock moved above Cdn$25.67 extending an intermediate uptrend. The stock responded to higher Western Canadian crude oil prices.
Links offered by valued providers
Michael Campbell's Money Talks for August 5th
Michael Campbell's MoneyTalks - Complete Show (mikesmoneytalks.ca)
MARK LEIBOVIT’S HOWE STREET PODCAST INTERVIEW -AUGUST 3, 2023
Copper Stocks Have Lots Of Volatility AUGUST 04, 2023 AT 11:02 AM Greg Schnell
Copper Stocks Have Lots Of Volatility | The Canadian Technician | StockCharts.com
Does A BIG Changing of the Guard Signal More Trouble for Tech Stocks? | (08.03.23)
Calculating the Risk of S&P 500 Downside Below October 2022 Low | The Final Bar (08.03.23)
Calculating the Risk of S&P 500 Downside Below October 2022 Low | The Final Bar (08.03.23) - YouTube
Stock Selection with the Wyckoff Market Report | Power Charting (08.04.23)
Stock Selection with the Wyckoff Market Report | Power Charting (08.04.23) - YouTube
5 Stocks Poised to Make BIG Moves Higher | Your Daily Five (08.04.23)
5 Stocks Poised to Make BIG Moves Higher | Your Daily Five (08.04.23) - YouTube
It wouldn’t surprise me to see a 10% correction between now and year end: Dan Niles
Tech Wreck Leads Markets Into a Downtrend — Here’s Where Key Support Lies
AUGUST 04, 2023 AT 09:17 PM Mary Ellen McGonagle
Tech Stocks Face BIG TIME Thrashing As Apple Disappoints | The Final Bar (08.04.23)
Tech Stocks Face BIG TIME Thrashing As Apple Disappoints | The Final Bar (08.04.23) - YouTube
Victor Adair's Trading Notes
Trading Desk Notes For August 5, 2023 - HoweStreet
Bob Hoye August 4, 2023 | Russia Working With Africa to Lower US Dollar
Russia Working With Africa to Lower US Dollar - HoweStreet
Ross Clark – Stock Markets, Stock Market Correction, Gold, Oil
This Week in Money - HoweStreet
Mark Bunting and www.uncommonsenseinvestor.com
Technical Scoop from David Chapman and www.EnrichedInvesting.com
S&P 500 Momentum Barometers
The intermediate term Barometer dropped 4.40 on Friday and 19.40 last week to 61.80. It remains Overbought. Daily trend is down.
The long term Barometer dropped 3.40 on Friday and 9.20 last week to 63.80. It remains Overbought. Daily trend is down.
TSX Momentum Barometers
The intermediate term Barometer added 5.96 on Friday, but dropped 7.20 last week to 58.15. It changed from Overbought to Neutral on a drop below 60.00. Daily trend is down.
The long term Barometer added 2.43 on Friday, but dropped 9.42 last week to 53.30. It changed from Overbought to Neutral on a drop below 60.00. Daily trend is down.
Disclaimer: Seasonality ratings 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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