Category Archives: Stocks

Bearish Engulfing Pattern for Shoppers Drug Mart

Shoppers Drug Mart could not break $41.

Your online trading success does not depend on your predictions for the market: your success depends on your online trades in reaction to market signals.

Bearish Engulfing Pattern for Shoppers Drug Mart on the 3 month daily candlestick chart

 

Updated article on Shoppers published in the National Post on March 30, 2011: Expanded Shoppers Drug services could help earnings, analyst says.

Please reference three previous posts on Shoppers Drug Mart.

  1. Shooting star candlestick for Shoppers Drug Mart
  2. Shoppers Drug Mart (SC) breaks resistance at $40
  3. Shoppers Drug Mart –  Bullish white candlestick

Shooting Star Candlestick for Shoppers Drug Mart

A shooting star candlestick developed on the daily candlestick chart which can be compared to a caution light.

It shows that the rally could not be maintained.  The stock opened at $40.82, above the close for the previous day’s bullish white candlestick, which was a strong opening.  But the bulls could not maintain the push  as the stock rallied to a high of $41.59 where there was selling pressure and the stock closed at $40.87: this was not a good day for the bulls.

Candlestick Analysis - shooting star candlestick for Shoppers Drug Mart

3-Month Daily Candlestick Chart

The trend is the most important concept in technical analysis. The intermediate trend (3 weeks to 3 months) is sideways and the near-term trend (within the last 3 weeks) is up. What we are trying to establish in this analysis is the likelihood of the near-term trend continuing upwards. Today, there is a hint of caution which you can see pictorially in the shooting star candlestick pattern.

Another important concept in technical analysis is support and resistance. On Monday, Shoppers Drug Mart closed above resistance at $40. This has been resistance for the last four months. The $40 price point reverses rolls and is now support for this stock. A close below $40 would be very negative for the near-term trend for Shoppers.

Shoppers Drug Mart (SC) breaks resistance at $40

Shoppers Drug Mart breaks technical resistance at $40 on this candlestick chart.

TradeOnline.ca featured Shoppers on February 6 and highlighted the first bullish white candlestick  that developed on above average volume. Above average volume is a confirming indicator and is the fuel that drives the upward trend. The $40 level is now support and the stock must hold above this point for the trend to continue.

Technical Analysis: Shoppers Drug Mart - candlestick chart - a bullish white candlestick breaks resistance at $40 on Monday, February 14, 2011

Shoppers Drug Mart (SC) 6-Month Daily

Shoppers Drug Mart will meet heavy resistance at $42. You can identify this point on the 3-year weekly chart.

Shoppers was upgraded from hold to buy on February 11 and the price target was raised to $43 from $39.

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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.

Copyright © TradeOnline.ca All rights reserved

Can Pfizer break resistance at $20?

The most important point in technical analysis is to determine the trend.

The intermediate and near-term trend for Pfizer (PFE) is up.  This drug stock had a very good move last week as indicated by the tall bullish white candlestick.  Also, the volume was above average: the volume is the fuel that drives a stock higher. Any upward price movement on low volume is suspect. If the stock can break resistance at $20, the next target price will be $22.

Pfizer, including other drug stocks, has underperformed the Dow over the last couple of years.  Pfizer has a decent yield of  4.15% and a solid cash flow. Now, traders are buying this orphan.

Pfizer - 2-year weekly candlestick chart with a bullish white candlestick and resistance at $20

Pfizer - 2-Year Weekly

Suncor – Shooting star candlestick

The intermediate trend (three weeks to three months) for Suncor is up.

But the shooting star candlestick is a warning signal: it is like a yellow light indicating caution. I do not want to see a close below $40 which is a support level. The next major support point would then be $35.

Technical analysis for Suncor listed on the TSX - shooting star candlestick

Suncor - 2-Year Weekly Chart

Shoppers Drug Mart – Bullish white candlestick

Bullish white candlestick for Shoppers Drug Mart

Daily Chart - (SC)

There was a bullish white candlestick for Shoppers Drug Mart (SC) on Friday, February 4.

It opened at $37.15 which was above the support level of $37.00.  The stock traded to a high of $39.13 and closed at $38.77 which was a gain of 4.18% for the day. The tall white candlestick is the graphical representation of that price action.

Please customize and then reference the full-size chart from Bigcharts.com for a better overall view of the trend.  Shoppers has been trading sideways since October so a break above the $40.00 resistance level would be a significant event.

Read the Globe and Mail article,  Shoppers Drug Mart’s quest for an elixir, for some current background information.

Note: You must take a couple of minutes to customize Bigcharts.com so that the links to the charts open with the indicators used in this site.

Note: This analysis is for educational purposes. Please conduct your own 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.

Copyright © TradeOnline.ca All rights reserved

Is there any doubt about the trend for BCE?

The 100-day moving  defines the trend line for BCE

Yes, it is definitely up. Defining the tend is the most important concept in technical analysis. You must always trade in the direction of the trend and jump aboard for the ride. Use candlesticks and other confirming indicators — moving averages, on balance volume and momentum indicators — to determine when it is time to exit the trade.  All the indicators will be reviewed in future posts using real time examples.  And, the objective of the site is to  keep-it-simple: anyone can complicate a topic.

Technical Analysis: BCE 3-year weekly candlestick chart with the moving averages, volume and momentum indicators.

BCE 3-Year Weekly Chart

See the article in the National Post on the analyst upgrade for BCE.

Note: This analysis is for educational purposes. Please conduct your own 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.
 
Copyright © TradeOnline.ca All rights reserved

Patriot Coal (PCX) – Major break at $25

This is a major coal mining company in the US.  Coal stocks are moving up due to the projected demand in China for metallurgical coal.

Take a look at the 3 year chart.  This is the start of a classic chart pattern with a break at $25 which is major resistance. Now the stock must hold above $25.  An important concept in technical analysis is support and resistance.  Once a stock breaks resistance; the price point becomes support.  In the case of Patriot Coal, $25 is now major support; and I will sell the stock if it does not hold this price point.

You can see the momentum in the 1 year chart.

Disclosure: I have a long position in this company at a purchase price of $20.60