Protect Your Portfolio 20190721

Hello, everyone. It's Stephen Whiteside here, from with this week's edition of Protect Your Portfolio. In this weekly presentation, we take a longer term look at the North American markets using weekly charts. We use weekly charts to help filter and squeeze out all of that market noise from Monday to Friday, so we're left with just one data point. And that, of course, is the closing price from 4:00 PM Friday afternoon.

Let's start off today's presentation with a little housekeeping. Just like you, and your family, will be taking some time off this summer, so will we. We will be closed the first full week of August, from the fifth to the ninth. We will be doing weekend updates before and after, we'll just be closed from the Monday to Friday, so just be aware of that. I'll certainly remind you again, as we get closer to that date.

Now, as I mentioned last week, on week's like this, we're going to look both ways, but we really don't have any new orders to put in the market. And that, of course, is true about 90% of the time. We just sit, and watch, and let the market do with its going to do. Now, if you were with us last weekend, we were coming up to a new full moon. The market peaked on the Monday, on the full moon, which was the Tuesday it started to move lower. So we traded lower for the rest of the week. We did not close at the low of the week. That happened on Thursday. We had a nice reversal on Thursday. Then, on Friday, we came back down.

Now, looking at the S&P 500 (^SPX), we were able to trade through the $3,000 level. In fact, we actually opened at the high of the week at $3,017.80. That was the high for the week. Then we came back down and closed below the $3,000 level. We did not close below the previous week's low, so not overly worried just yet. Looking at the NASDAQ 100 (^NDX), we came up to the $8,000 level. We got as high as $7969.79, so we're $30 and change away from the $8,000 level before we backed away. Now, again, we didn't close below the previous week's low. That would be the first sign that something new is happening, so we'll have to see if the market heads down towards that level this week.

Now, looking at the Russell 2000 (^RUT), of course, nowhere near the previous highs. And, of course, we just put in a lower high here, trading back in the channel. That's also true for the Zacks Micro Cap Index (^ZAX), so really didn't participate in this recent rally. And, again, we're nowhere near those highs that we saw back earlier in the year, back in February. So we've made a series of lower highs. That's bearish for the micro cap sector.

Looking at the Canadian Market, it was an inside week for the S&P/TSX Composite index (^GSPTSE), an inside week for the S&P/TSX 60 Index (TX60.TS). More interest in the S&P/TSX Canadian MidCap (SPTSEM), which were up over half a percent on the week. Then a lot more interest in S&P/TSX SmallCap Index (^SPTSES), and that had a lot to do with a couple of silver mining stocks. You can see, here. First Majestic Silver Corp. (FR.TO), then we've got Pan American Silver Corp. (PAAS.TO), and then SSR Mining Inc. (SSRM.TO), all had great weeks. That helped move the small cap index higher. Looking at micro caps S&P/TSX Venture Composite Index (^SPCDNX), they were also up on the week, but certainly nowhere near a new weekly buy signal.

Then we had an inside week for the bond market US 30 Year T-Bond, so no change there. Then we had the US dollar trade higher, still on a weekly sell signal. We had the Euro trade lower, still on a weekly buy signal. And the Canadian dollar might have put in a double-top here. We ran up to the previous week's high and stopped and pulled back. Certainly, an inside week for the Canadian dollar and no change in trend expected this coming week.

Next up, let's take a look at commodity prices. Crude oil certainly stunned a lot of people. We are down over 7% on the week, came down to the lower channel line, but did not close below it. But we are down over 7% on the back of a lot of activity in the Persian Gulf. Normally, people would expect that, that sort of activity would push crude oil higher. This week it actually did the opposite, so a lot of people are stunned by that. Downward pressure on crude oil also put downward pressure on gasoline, which is good for people driving this summer. And natural gas, believe it or not, closed lower on the week, even though all the utilities in North America are running at, probably, 110% right now given this heatwave.

Looking at the metals, copper was up nicely. It traded through the upper channel line, did not close above it, so no change in trend there. We've got gold making new highs this week and starting to trade above our projected trading range. The high of the week, and the high for this year, is $1444.20. So we started to trade above the $1437.50 level. Now, remember, at the start of the year, that was the top of our projected trading range on the weekly charts, but that has started to expand. So our latest weekly chart takes us up to $1468.75, as our next target to the upside. The top of the projected trading range, right now, is up there at $1656.25. Certainly, no guarantee that we will get there, but mathematically that is now in our range, if the market wants to continue higher from here. And, of course, we had a huge pop in silver and that certainly helped a lot of those small mid cap stocks move higher.

Okay, folks, that is all for today's presentation. Too early today to look at the futures and the pre-market this morning, so I don't know what's going on there. But next time you'll hear my voice is on Tuesday morning and, at that time, I'll take a closer look at the US Stock Market.

Stephen Whiteside

Stock Market Timing Service