The Canadian Technician

Ballard Power (BLP.TO) Kicks In The Backup Power Supply

One of the beautiful things about technical analysis is it quickly evaluates a stock. Without a lot of debate, you can quickly understand a trend. Is it up or down? Well, this morning, Ballard (BLP.TO) crossed into one of my scans again. What used to be one of the high rolling stocks 15 years ago, is actually rising up after being in a long-term meltdown. I'll leave it to you to decide if you want to investigate a micro-cap stock of $350 Million, but it has a lot of interesting qualities that made it worthy of an article this morning.

We can see the stock has popped up many times before, but rarely did it last more than a few weeks. This stock has also had more failed starts than any investor would like to endure. Fool me once, it happens; fool me again and again, my bad. So if the reputation of delivery by management is in question, this stock has all the hallmarks of hype and no follow through technically. I will say that they have partnered with some of the largest firms in the world. The technology has promise, but it seems hard to deliver.

First of all, the SCTR has stayed above the 75 level for 4 weeks. The straight line in the middle of the SCTR is when the price / volume was so low the stock did not have an SCTR. We can see in the chart a surge above the downward trend in 2013. The surge lasted for almost a year. The stock exceeded it's breakout level by 6x before it was done within 9 months! Common in hot trends, a parabolic blowoff ensued. Now we can see another 2-year downtrend that did not return to the long-term low. What makes the stock more interesting now is the consolidation (bull flag) after breaking above the trend line. 

Lastly, I have only shown the last 10 years, but this used to be a $100 stock! Watching it wrestle around at the $3.00 level for most of the chart shown is really incredible. However, If you look at the MACD, you'll see the stock rarely has positive (above zero) momentum. The recent volume spike has follow-through volume and the MACD is rising. Other than the blow off top, the stock has not had a volume surge like it had in July 2016.

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Industrial Alliance (IAG.TO) Puts New 52 Week Highs In Place

Industrial Alliance (IAG.TO) rang the new 52-week high alarm this week.

It also is very close to breaking out to new 3-year and all time highs. I wrote about Canadian Insurance companies  a few weeks ago mentioning how weak they all are. The one exception was Industrial Alliance (IAG.TO).

With Dr. Yellen talking the market sideways in Jackson Hole, it didn't really add fuel to anything on the interest rate sensitive picture. 

This stock is showing some great leadership and the 2-year highs in momentum (MACD) are encouraging. Usually, you need a good kick start to get running fast. With all the other indicators lining up, this looks encouraging. The SCTR has moved above 75, and the Relative Strength is very close to new 52 week highs which should garner some attention from the heavy hitters soon.

When things get above the horizon, who knows what can happen. I will be hosting Martin Pring tomorrow on Martin's Market Roundup Live 2016-08-30 edition. Click here to register.

Don't forget about ChartCon 2016! If you enjoyed Martin and I presenting side by side, you'll really enjoy a group of technicians talking about the market leading into a 4th quarter finish for 2016

Good trading,
Greg Schnell, CMT, MFTA

 

Canadian Banks Continue To Find All-TIme Highs

Canadian banks have been some of the best-performing banks in North America. While that isn't a stellar statement of strength, they are doing a good job of outperforming their beaten down peers. As the market participants wrestle with the Fed Yin-Yang every day, there is a quiet strength starting to show up across the large cap banks in North America. Let's zoom in on the Canadians as they reported some earnings this week.

Bank Of Montreal (BMO.TO) had a great week. The chart is breaking to new highs, moving above a consolidation range. The volume accelerated on the breakout which is nice to see. We want to see the SCTR start to push above 75.

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Martin Pring And Greg Schnell Are Live From Pring Studios 2016-08-23

Martin Pring and Greg Schnell are getting together in Pring Studios in Florida to do a live debate webinar. The setup is compelling as many of the major charts in the world are lining up for a major shift. I've nicknamed the webinar 'Back From The Precipice' as the charts appear to be setting up for a major trend change.

Click here to Register for Back From The Precipice with Martin And Greg.

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Canadian Insurance Companies Are Some Of The Weakest Stocks

Looking through the Canadian insurance companies, I was not surprised but I think it is worth noting how weak they all are. When an entire industry group makes up a very weak sector, it is good to avoid. But there is always a time to get back in. This article shows a suggested methodology for doing that. The SCTR information can also be used to help us see turnaround situations. We can set an SCTR level as a target for them to break out. When they stop being the weakest stocks as a group, we can start to look at them again. This style of investing with the SCTR is harder, but you are typically buying closer to the lows.

Here is Great-West Lifeco (GWO.TO). The SCTR ranking is now below 10. This is the lowest level in 5 years. At this point, there is no reason to invest in the industry, but we can set an alert when the SCTR starts to improve above 25. We can do that for each stock. The run off the SCTR lows in 2014 was a pretty good rally for a beaten down stock.

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The $TSX Holds New 52 Week Highs

The Canadian Stock Exchange ($TSX) had not made new 52-week highs for a couple of years. Finally, in August we started to hit new 52-week highs. Our last 52-week high was in September 2014.

But one of the most important parts of this rally is that markets around the world are breaking trend lines, or new 52 week highs, or all time highs. 

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Is Canada's New Economic Engine A Marijuana High?

Canopy Growth Corp (CGC.TO) just moved from the Venture to the $TSX exchange. Well, someone noticed. The stock absolutely soared to new highs. This article could be filled with puns about new highs, stimulus, kicking off a weed-end, etc. etc but I shall resist!

With political developments favoring the stock and a method of investing in the cannabis trade on the main exchange, the stock couldn't be contained in old price ranges. 

 

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The Agricultural Crops Look Fantastic This Year

This is the fifth article in a series about a 1700 Kilometre (over 1000 miles) road trip that I did two weeks ago. You can follow these links to the first four articles. 

Canadian Transportation Companies Start My Tour

Canadian Forestry Companies Under Review

Canadian Pipeline Companies Under The Microscope

Canadian Pipeline Companies Under The Microscope (Part 2)

On my road trip through the mountains and into the grain growing region, a massive transition from mining and forestry into grain and livestock takes place. We also travelled through Jasper National Park. Caribou are not found as far south as Calgary, but this bull Caribou was just east of the Jasper townsite.

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