TSX Index in a lateral trading band
Yes, the TSX Index has a negative technical profile. The intermediate trend is sideways as identified on the above daily candlestick chart. A confirmed break below 12,300 would be a warning to liquidate long positions.
Think about the major sectors in the TSX Index. The materials sector has a negative technical profile. The energy sector has a negative technical profile. Investors are taking money out of the hot REIT sector as rates slowly rise and on the news of subpar Canadian economic indicators. And the utilities are priced to perfection. And the two major telecos — BCE and Telus — had a nice run and are also priced to perfection. What is left? Some bank stocks like RBC moved upward over the past four months and the Lifecos are coming back from the dead but are still on life support.
Caution is advised especially with the news coming out of China about the actual or perceived slowdown.
Reference the last chart analysis of the TSX Index based on the weekly chart. This is a three year chart with the the 50 day, 100 day and 200 day simple moving averages. The TSX Index is holding just above the 200 day moving average. You will see the golden cross (50 day crossed above the 200 day) on this longer term chart but the the cross is a little tarnished at this stage.
Notice the similarities with the daily chart for copper? Yes, we are a resource based economy.
Relevant articles picked from the Web:
- Closing Bell: TSX posts fifth weekly decline, quarterly gain — FP — March 30, 2012
- Taking stock of the TSX at the quarter-pole — Globe Investor — March 27, 2012
- Moody’s maintains negative outlook on paper and forest industry — Globe Investor — March 27, 2012
- Gas, food pushes up Canada’s inflation rate — Financial Post — March 23, 2012
- China slowdown is no short-term blip — Globe Investor — March 22, 2012
Note: This technical analysis is for educational purposes so you can learn to trade online using candlestick charts. Please conduct your own chart analysis or consult your financial advisor before making investment decisions. The chart snippets are from BigCharts.com which I recommend and have used for fifteen years. The author of this article may hold long or short positions in the featured stock or index.
© 2012 TradeOnline.ca