Tech Talk for Tuesday February 20th 2024

U.S. equity index futures were lower this morning. S&P 500 futures were down 18 points at 8:35 AM EST.

The Canadian Dollar dropped 0.20 to US74.00 cents following release of Canada's January Consumer Price Index at 8:30 AM EST. Consensus was an increase of 0.4% versus a decline of 0.3% in December. Actual was unchanged. On a year-over-year basis, consensus was an increase of 3.2% versus a gain of 3.4% in December. Actual was a gain of 2.9%.

The Shanghai Composite Index added 12.19 to 2,922.73 after resumption of trading following the Chinese New Year celebration. Strength in the Index was helped by news that the Peoples Bank of China cut in its five year prime loan rate for major banks by 0.25% to 3.95%.

Discover Financial Services added $0.16.51 to $127.00 after Capital One Financial announced plans to purchase the company through a share exchange valued at $35.3 billion.

Home Depot dropped $8.35 to $354.00 after reporting less than consensus fourth quarter earnings.

Walmart gained $3.64 to $174.00 after reporting higher than consensus fourth quarter earnings.

The Bottom Line

Changes by key world equity indices were significant last week: U.S. equity indices moved lower following release of higher than consensus January CPI and PPI reports. Equity indices and related ETFs for India, Japan, China and Europe rose significantly. China iShares completed a double bottom pattern. EAFE iShares touched an all-time high. Sectors that were notably higher were energy and base metals. 'Tis the season for the industrial commodity prices and related ETFs to move higher until late May!

Consensus for Earnings and Revenues for S&P 500 Companies

Source: www.FactSet.com

Earnings estimates for the fourth quarter of 2023 were raised again. Seventy nine percent of S&P 500 companies have reported to date. Fourth quarter 2023 earnings now are expected to increase 3.2% on a year-over-year basis (versus an increase last week of 2.9%). Estimate for fourth quarter revenues is an increase of 4.0% (versus a gain last week of 3.9%).

Analysts reduced slightly their earnings and revenue estimates for each quarter in 2024:

A significant earnings recovery by S&P 500 companies expands in the first quarter of 2024, but at a slightly lower than previous rate. Consensus for the first quarter on a year-over-year basis calls for an earnings increase of 3.9% (versus increase last week of 4.0%) and a revenue increase of 3.5% (versus an increase last week of 3.6%).

Earnings gains accelerate thereafter to the end of 2024, all-be-it at a slower pace. Consensus for the second quarter calls for a 9.0% earnings increase (versus a 9.1% increase last week) and a 4.6% increase in revenues (versus a 4.8% increase last week). Consensus for the third quarter calls for an 8.0% increase in earnings (versus previous 8.1% increase) and a 5.0% increase in revenues. Consensus for the fourth quarter calls for a 17.6% increase in earnings (versus previous 17.7% increase) and a 5.7% increase in revenues (versus previous 5.6% increase). For all of 2024, consensus calls for a 10.9% increase in earnings and a 5.4% increase in revenues.

Economic News This Week

Source: www.Investing.com

January Canadian Consumer Price Index is released at 8:30 AM EST on Tuesday

January U.S. Leading Economic Indicators released at 10:00 AM EST on Tuesday are expected to decline 0.2% versus a decline of 0.1% in January.

FOMC Meeting Minutes are released at 2:00 PM EST on Wednesday

December Canadian Retail Sales are released at 8:30 AM EST on Thursday

January U.S. Existing Home Sales released at 10:00 AM EST on Thursday are expected to increase to 3.96 million units from 3.78 million units in December.

Selected Earnings News This Week

Source: www.Investing.com

Focus this week is on Nvidia's quarterly results released on Wednesday.

Another 54 S&P 500 companies are scheduled to release results (including two Dow Jones Industrial Average companies: Wal-Mart and Home Depot on Tuesday). Five TSX 60 companies are scheduled to report.

Trader's Corner

Equity Indices and Related ETFs

Daily Seasonal/Technical Equity Trends for Feb.16th 2024

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 Feb.16th 2024

Green: Increase from previous day

Red: Decrease from previous day

Sectors

Daily Seasonal/Technical Sector Trends for Feb.16th 2024

Green: Increase from previous day

Red: Decrease from previous day

Links offered by valued providers

How Long Can This Market Sustain All-Time Highs? Bruce Fraser

(including comments on CNN Fear and Greed Index and the Dow Jones Decennial Pattern)

https://www.youtube.com/watch?v=Mipt7PFgIUs

How to Spot an Impending S&P 500 Selloff: Tom Bowley

https://www.youtube.com/watch?v=jWrt1RHnoV0

SMCI Breaks $1,000 Level – What’s Next? David Keller Guest: Bob Lang

https://www.youtube.com/watch?v=u4gS2Vnjjdk

BUY Signals Continue to Diminish: Carl Swenlin

BUY Signals Continue to Diminish | DecisionPoint | StockCharts.com

Russell 2000 creeping higher. Bitcoin going on a tear: Mark Leibovit

Russell 2000 Creeping Higher - HoweStreet

Michael Campbell's Money Talks for February 17th

Michael Campbell's MoneyTalks - Complete Show (mikesmoneytalks.ca)

Are Toppy Markets Heading for a 1929 Like Crash? Bob Hoye

Are Toppy Markets Heading for a 1929 Like Crash? - HoweStreet

Trading Desk Notes for February 17th: Victor Adair

Trading Desk Notes For February 17, 2024 - HoweStreet

Technical Scoop from David Chapman and www.EnrichedInvesting.com

https://enrichedinvesting.com/wp-content/uploads/2024/02/Vibrant-inflation-slowing-economy-various-failures-rising-oil-geopolitical-concerns-possible-turn.pdf

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

EAFE iShares $EFA moved above $76.28 to an all-time high extending an intermediate uptrend.

China iShares FXI moved above $23.09 completing a double bottom pattern.

Gilead $GILD an S&P 100 stock moved below $71.88 extending an intermediate downtrend.

Micron MU a NASDAQ 100 stock moved below intermediate support at $80.58.

Base metals stocks and related ETFs (e.g. XBM.TO) are responding to higher base metal prices. See $DBB. Lundin Mining $LUN.TO moved above Cdn$11.71 extending an intermediate uptrend.

Silver ETN $SLV moved above intermediate resistance at $21.35.

S&P 500 Momentum Barometers

The intermediate term Barometer dropped 3.00 on Friday and 1.80 last week to 61.20. It remains Overbought.

The long term Barometer dropped 2.00 on Friday, but added 0.20 last week to 71.00. It remains Overbought.

TSX Momentum Barometers

The intermediate term Barometer added 2.22 to 61.78. It gained 2.22 on Friday and advanced 4.89 last week to 61.78. It changed from Neutral to Overbought on a move above 60.00.

The long term Barometer added 1.33 on Friday and gained 3.55 on Friday to 60.44. It changed from Neutral to Overbought on a move above 60.00.

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