Activist investing continues to gain advocates — and capital; according to Hedge Fund Research...
View from Toronto: Trade Ideas for US, TSX This Week
08/15/2017 3:03 am EST
In U.S. markets, Materials/Mining and Energy face pressure from a rising USD mid-week onwards and weaken to end the week. In Canada, Materials (XMA-T) enjoy a weaker USD front end of the week but bearishly reverse mid-week onwards, says Ziad Jasani.
US Equity Market Outlook & Summary– Week of August 14-18:
For slide format use this link:
Implications (US): S&P 500 is tepidly holding at the support of 2,440-35, with better odds to hold above to start the week, but then reverse under mid-week-onwards – projecting down to 2,400. Growth-based spaces are likely to out-perform to start the week (Technology, Discretionaries, Industrials, Miners). Financials continue to face downside-pressure on yields being suppressed from August 11 CPI miss.
However, Materials/Mining and Energy are likely to face pressure from a rising USD mid-week onwards and weaken to end the week. Defensives (including Bonds, Inverse Plays) are not likely to deliver to start the week, but important as a hedge, and likely to out-perform to end the week.
SPDR S&P Biotech ETF (XBI)
SPDR S&P Pharmaceuticals ETF (XPH)
SPDR S&P Metals & Mining (XME)
Consumer Discretionary Select Sector SPDR Fund (XLY)
Technology Select Sector SPDR Fund (XLK)
iShares US Technology ETF (IYW)
Canadian Market Outlook & Summary – Week of August 14-18:
For slide format use this link:
Implications (Canada): TSX is tied to Oil which has “overheated.” All short-term technicals support a pull-back in Oil and the Commodity-Complex in general. However, to start the week, Oil is likely to continue hovering under $49.50.
While Oil hovers above $48.50 the TSX is likely to remain above support of 15,025-14,950 but watch out below if Oil breaks and sustains below $48.
The TSX is likely to face some downside pressure from Financials iShares S&P/TSX Capped Financials Index ETF (XFN-T) to start the week, but that is likely offset by Energy iShares S&P/TSX Capped Energy Index ETF (XEG-T) which implies a bounce off support at 15,025-14,950 at the front end of the week but Wednesday, August 16 onwards downside risk grows.
Materials iShares S&P/TSX Capped Materials Index ETF (XMA-T) enjoy a weaker USD front end of the week and rise, but bearishly reverse mid-week onwards. Defensives sectors shore up the front end of the week, but FOMC Meeting Minutes August 16 are likely to pressure them down to end the week.
Trade-able short-term front half of the week ↑ (CDN)
iShares S&P TSX Capped Composite Index (XIC-T)
iShares S&P/TSX Capped Energy Index ETF (XEG-T)
iShares S&P/TSX Capped Financials Index ETF (XFN-T)
BMO S&P/TSX Equal Weight Banks Index ETF (ZEB-T)
Weekly Video Market Strategy Session – August 14:
Related Articles on STRATEGIES
While the Dow has not stayed on the balance line we’ve discussed in recent updates, last Frida...
We must apply a high degree of logic in our daily lives to survive and prosper. Yet, in trading, the...
This week is about inflation, inflation and inflation! Today, the US CPI (Consumer Price Inflation) ...