WALL STREET RAW RADIO – SATURDAY, DECEMBER 16, 2017 – WITH HOST, MARK LEIBOVIT GUESTS INCLUDE: DON VIALOUX, HENRY WEINGARTEN, HARRY BOXER, BILL MURPHY (GATA.ORG) https://tinyurl.com/yd7ssshe Michael Campbell’s Show on Saturday On today’s show Josef Schachter told us why he is now recommending investors get back into the energy sector. More importantly he told us he has issued Action Alerts to his subscribers on nine specific companies. And as always, Michael has made sure our listeners can get access with a special discount. The Schachter Energy Report is one of our favourite reads right now. SPECIAL OFFER – get $50 off the annual subscription fee for the Schachter Energy Report and $75 off the Black Gold Service. Just use the respective promo codes below. CLICK HERE to ORDER: SER50 BG75 ** Remember to enter the code and click the APPLY COUPON button before proceeding to checkout. The Bottom Line Once again, several of the broadly based U.S. equity indices closed at or near all-time closing highs on Friday. Short term technical indicators moved higher. Seasonal influences for most world equity markets turned positive in mid-October and remain positive until the first week in January. Traditional seasonal sensitive sectors (e.g. Consumer Discretionary, Industrials and Financials) are leading the market higher. The Technology sector also recorded a strong rebound again last week. However, medium term technical indicators for the S&P 500 Index, NASDAQ Composite Index, Dow Jones Industrial Average as well as TSX Composite Index remain overbought. Preferred strategy is to take at least partial profits on strength in seasonally attractive equities and Exchange Traded Funds during the expected “Santa Claus rally” period with the understanding that their next significant intermediate upside move likely will not resurface until next February. Tax loss selling pressures in the underperforming energy, oil service and precious metal sectors finally appears to have peaked for the season. Weakness has provided a buying opportunity for a seasonal trade in these sectors into spring. Precious metal stocks began showing technical signs of outperformance late last week, an encouraging technical sign as they enter their period of seasonal strength. Economic News This Week November Housing Starts to be released at 8:30 AM EST on Tuesday are expected slip to 1.24 million units from 1.290 million units in October November Existing Home Sales to be released at 10:00 AM EST on Wednesday are expected to increase to 5.53 million units from 5.48 million units. Revised Third Quarter Estimate of Third Quarter Real GDP to be released at 10:00 AM EST on Thursday is expected to remain unchanged at 3.3%. Weekly Jobless Claims to be released at 8:30 AM EST on Thursday are expected to increase to 234,000 from 225,000 last week. December Philly Fed Index to be released at 8:30 AM EST on Thursday is expected to slip to 21.8 from 22.7.. November Leading Economic Indicators to be released at 10:00 AM EST on Thursday are expected to slip to a gain of 0.3% from a gain of 1.2% in October. Canadian October Retail Sales to be released at 8:30 AM EST on Thursday are expected to increase 0.4% versus a gain of 0.1% in September. Canadian November Consumer Prices to be released at 8:30 AM EST on Thursday are expected to increase 0.2% versus a gain of 0.1% in October. November Durable Goods Orders to be released at 8:30 AM EST on Friday are expected to increase 2.0% versus a decline of 0.8% in October. Excluding Transportation, November Durable Goods Orders are expected to increase 0.3% versus a gain of 0.9% in October November Personal Income to be released at 8:30 AM EST on Friday is expected to increase 0.4% versus a gain of 0.4% in October. November Personal Spending is expected to increase 0.4% versus a gain of 0.3% in October. November New Home Sales to be released at 10:00 AM EST on Friday are expected to drop to 650,000 from 685,000 in October. December Consumer Sentiment Index to be released at 10:00 AM EST on Friday is expected to increase to 97.0 from 96.8 in November. Earning News This Week Observations Trading activity slows this week prior to the Christmas holiday. Major equity markets outside of the U.S. continue to struggle. Most peaked 4-8 weeks ago (including the TSX Composite except for a brief new high reached last week) Technical action by individual S&P 500 stocks was quietly mixed last week despite a gain by the Index. Number of stocks breaking resistance totaled 23 while number of stocks breaking support totaled 15. Number of stocks trading in an uptrend increased to 305 from 304, number of stocks trading in a neutral trend dropped to 55 from 61 and number of stocks in a downtrend increased to 140 from 135. The Up/Down ratio slipped last week to (305/140=) 2.18 from 2.25. Economic news this week focuses on passage of the Tax Bill. The market is anticipating passage of the bill. Likely time of the vote by the House is Tuesday. Likely time of the vote by the Senate is Thursday. Medium term technical indicators (Percent of stocks trading above their 50 day moving average, Bullish Percent Index) remain at intermediate overbought levels Short term technical indicators (short term momentum, above/below 20 day moving average) for equity indices generally moved higher, but are overbought. Seasonal influences on a wide variety of equity indices, commodities and sectors began to turn neutral/positive in early October and continues to improve. During the past 20 years, the S&P 500 Index and TSX Composite Index bottomed on average on October 10th. Historically, December has been one of the strongest months (the “Santa Claus rally” from December 15th to January 6th is the strongest period in the year for U.S. and Canadian equity indices). Earnings reports by major U.S. and Canadian companies are quiet this week. Focus is on Darden Restaurants, Carnival Cruise Line and General Mills. Twelve S&P 500 companies are scheduled to report fourth quarter results. The outlook for S&P earnings and sales remains positive. Fourth quarter earnings are expected to increase 10.6% on a year-over-year basis on a 6.6% increase in sales (up from 6.4% last week). First quarter 2018 earnings are expected to increase 10.7% (up from 10.6% last week) on a 6.8% increase in sales (up from 6.4% last week). Second quarter 2018 earnings are expected to increase 10.3% (up from 10.2% last week) on a 6.7% increase in revenues (up from 6.2%). Third quarter earnings are expected to increase 11.8% (up from 11.6%) on a 5.7% increase in revenues (up from 5.4%). Fourth quarter 2018 earnings are expected to increase 11.1% on a 4.3% increase in revenues. For all of 2018, earnings are expected to increase 11.2% on a 5.5% increase in sales (up from 5.4%). Short term political uncertainties remain, including North Korean “sabre rattling”, struggling NAFTA negotiations and increased scrutiny by special council on Russia’s influence on the Presidential election Earnings and revenue prospects beyond the third quarter report season are exceptional for U.S. based companies with international exposure. Consensus for S&P 500 earnings on a year-over-year are expected to exceed 10% in the fourth quarter of 2017 and throughout 2018. Earnings will benefit significantly from weakness in the U.S. Dollar on a year-over-year basis when revenues and earnings from international operations will benefit from higher valued foreign currencies. The U.S. Dollar Index averaged 100 in the fourth quarter of 2016 and 101 in the first quarter of 2017. Recent tax loss selling pressures in selected sectors appears to have peaked last week and has set up a buying opportunity for a Santa Claus rally from the second half of December to at least the first week in January. The sectors that were under the most downside tax loss selling pressures were the energy, oil services and gold sectors. Selected stocks in the gold and precious metals sectors moved strongly higher late last week implying that seasonal influences may have come sooner than normal this year. Equity Indices and Related ETFs Daily Seasonal/Technical Equity Trends for December 15th 2017 Green: Increase from previous day Red: Decrease from previous day Calculating Technical Scores Technical scores are calculated as follows: Intermediate Uptrend based on at least 20 trading days: Score 2 Higher highs and higher lows Intermediate Neutral trend: Score 0 Not up or down Intermediate Downtrend: Score -2 Lower highs and lower lows Outperformance relative to the S&P 500 Index: Score: 2 Neutral Performance relative to the S&P 500 Index: 0 Underperformance relative to the S&P 500 Index: Score –2 Above 20 day moving average: Score 1 At 20 day moving average: Score: 0 Below 20 day moving average: –1 Up trending momentum indicators (Daily Stochastics, RSI and MACD): 1 Mixed momentum indicators: 0 Down trending momentum indicators: –1 Technical scores range from -6 to +6. Technical buy signals based on the above guidelines start when a security advances to at least 0.0, but preferably 2.0 or higher. Technical sell/short signals start when a security descends to 0, but preferably -2.0 or lower. Long positions require maintaining a technical score of -2.0 or higher. Conversely, a short position requires maintaining a technical score of +2.0 or lower. The S&P 500 Index gained 24.31 points (0.92%) last week. Intermediate trend remains up. The Index remains above its 20 day moving average. Short term momentum indicators are overbought and showing early signs of peaking. Percent of S&P 500 stocks trading above their 50 day moving average (also known as the S&P Momentum Barometer) slipped last week to 74.40 from 75.60. Percent remains intermediate overbought and trending down. Percent of S&P 500 stocks trading above their 200 day moving average increased last week to 79.80 from 78.20.Percent remains intermediate overbought. Bullish Percent Index for S&P 500 stocks increased last week to 77.80 from 75.80 and remained above its 20 day moving average. The Index remains intermediate overbought. Bullish Percent Index for TSX stocks was unchanged last week at 65.46 and remained below its 20 day moving average. The Index remains intermediate overbought and trending down. TSX Composite Index lost 54.09 points (0.34%) last week. Intermediate trend remains up (Score: 2). Strength relative to the S&P 500 Index remains negative (Score: -2). The Index moved back above its 20 day moving average on Friday (Score: 1). Short term momentum indicators are trending down (Score: -1). Technical score slipped last week to 0 from 2. Percent of TSX stocks trading above their 50 day moving average (Also known as the TSX Momentum Barometer) dropped last week to 48.76 from 49.38. Percent remains intermediate neutral and trending down. Percent of TSX stocks trading above their 200 day moving average dropped last week to 57.85 from 59.34. Percent remains intermediate overbought and trending down. Dow Jones Industrial Average added 322.58 points (1.33%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains positive. The Average remains above its 20 day moving average. Short term momentum indicators are trending up. Technical score increased last week to 6 from 4. Bullish Percent Index for Dow Jones Industrial stocks remained unchanged last week at 93.33 and remained above its 20 day moving average. The Index remains intermediate overbought. Bullish Percent Index for NASDAQ Composite stocks slipped last week to 61.76 from 62.15 and dropped below its 20 day moving average. The Index remains intermediate overbought and trending down. NASDAQ Composite Index added 96.50 points (1.41%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains negative. The Index remains above its 20 day moving average. Short term momentum indicators are trending up. Technical score increased last week to 2 from 0. Russell 2000 Index added 8.70 points (0.57%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains negative. The Index moved back above its 20 day moving average on Friday. Short term momentum indicators are trending down. Technical score slipped last week to 0 from 2. Dow Jones Transportation Average lost 9.50 points (0.10%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains positive. The Average remains above its 20 day moving average. Short term momentum indicators are trending down. Technical score remained last week at 4. Australia All Ordinaries Composite Index added 6.90 points (0.11%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains negative. The Index remains above its 20 day moving average. Short term momentum indicators are trending up. Technical score increased last week to 2. Nikkei Average dropped 257.86 points (1.13%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains negative. The Index dropped below its 20 day moving average on Friday. Short term momentum indicators are trending down. Technical score dropped last week to 0 from 2. Europe iShares slipped $0.12 (0.26%) last week. Intermediate trend remains neutral. Strength relative to the S&P 500 Index remains negative. Units dropped below their 20 day moving average on Friday. Short term momentum indicators turned back down. Technical score dropped last week to -4 from -2 Shanghai Composite Index dropped another 23.85 points (0.72%) last week. Intermediate trend remains neutral. The Index remains below its 20 day moving average. Short term momentum indicators are starting to move higher. Technical score improved last week to -2 from -4. Emerging Markets iShares added $0.23 (0.50%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index remains negative. Units remain below their 20 day moving average. Short term momentum indicators have turned up. Technical score improved last week to -4 from -6. Currencies The U.S. Dollar Index dropped 0.41 (0.44%) last week. Intermediate trend currently is neutral. The Index recovered to above its 20 day moving average on Friday. Short term momentum indicators are trending down. The Euro slipped 0.20 (0.17%) last week. Intermediate trend remains neutral. The Euro dropped below its 20 day moving average. Short term momentum indicators are trending down. Canadian Dollar dropped 0.14 (0.18%) last week (including a 0.42 plunge on Friday). Intermediate trend remains neutral. The Canuck Buck dropped below its 20 day moving average on Friday. Short term momentum indicators are trending down. Japanese Yen added 0.67 (0.76%) last week. Intermediate trend remains up. The Yen dropped back below its 20 day moving average on Friday. Short term momentum indicators are trying to recover. British Pound dropped 0.74 (0.55%) last week. Intermediate trend remains up. The Pound dropped below its 20 day moving average. Short term momentum indicators are trending down. Commodities and Related ETFs Daily Seasonal/Technical Commodities Trends for December 15th 2017 Green: Increase from previous day Red: Decrease from previous day * Excludes adjustment from rollover of futures contracts CRB Index lost 0.50 (0.27%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index remains negative. The Index remains below its 20 day moving average. Short term momentum indicators are trending down. Technical score remains at -6. Gasoline dropped 6.5 cents per gallon (3.78%) last week. Intermediate trend remains down. Gas remains below its 20 day moving average. Short term momentum indicators are trending down. Technical score remained last week at -6. Crude Oil slipped $0.03 per barrel (0.05%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains neutral. Crude moved below its 20 day moving average. Short term momentum indicators are trending down. Technical score dropped last week to 0 from 2. Natural Gas plunged $0.16 (5.78%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index remains negative. “Natty” remains below its 20 day moving average. Short term momentum indicators are trending down. Technical score remained last week at -6. S&P Energy Index slipped 0.53 (0.10%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains neutral. The Index remains above its 20 day moving average. Short term momentum indicators are trending up. Technical score remained last week at 4. Philadelphia Oil Services Index dropped 0.89 (0.64%) last week. Intermediate trend remains neutral. Strength relative to the S&P 500 Index remains neutral. The Index remained above its 20 day moving average. Short term momentum indicators have turned up. Technical score increased last week to 2 from 0. Gold gained $9.00 per ounce (0.72%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index remains negative. Gold remains below its 20 day moving average. Short term momentum indicators have just turned up. Technical score improved last week to -4 from -6. Silver gained $0.24 per ounce (1.52%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index remains negative. Silver remains below its 20 day moving average. Short term momentum indicators have turned up. Technical score improved last week to -4 from -6. AMEX Gold Bug Index added 2.90 points (1.63%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index remains negative. Silver remains below its 20 day moving average. Short term momentum indicators have turned up. Technical score improved last week to -4 from -6. Platinum added $5.70 per ounce (0.65%) last week. Trend remains down. Relative strength remains negative. Remains below its 20 day MA. Momentum remains down. Score: -6 Palladium gained $19.00 per ounce (1.97%) last week. Trend remains up. Relative strength changed to positive from negative. Remains above its 20 day MA. Momentum: up. Copper gained $0.15 per lb (5.03%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index changed to neutral from negative. Copper moved above its 20 day moving average. Short term momentum indicators turned up. Technical score increased last week to 0 from -6. BMO Base Metals ETF gained $0.44 (3.85%) last week. Intermediate trend remains down. Strength relative to the S&P 500 Index changed to neutral from negative. Units moved above their 20 day moving average. Short term momentum indicators turned higher. Technical score increased last week to 0 from -6. Lumber added 2.20 (0.51%) last week. Trend remains up. Relative strength remains negative. Trades above its 20 day moving average. Short term momentum indicators trending up. Grain ETN dropped another $0.42 (1.70%) last week. Trend remains down. Relative strength remains negative. Remains below its 20 day MA. Momentum remains down. Score: -6 Agriculture ETF added $0.15 (0.25%) last week. Intermediate trend remains up. Strength relative to the S&P 500 Index remains negative. Units remain above their 20 day moving average. Short term momentum indicators are trending down. Technical score slipped last week to 0 from 2. Interest Rates Yield on 10 year Treasuries slipped 2.8 basis points (1.18%) last week. Intermediate trend remains up. Yield dropped below its 20 day moving average on Friday. Short term momentum indicators are mixed. Price of the long term Treasury Bond ETF added $1.66 (1.31%) last week. Intermediate trend remains up. Price remains above its 20 day moving average. Short term momentum indicators are trending up. Volatility The VIX Index dropped another 0.15 (1.57%) last week. The Index remains below its 20 day moving average. Sectors Daily Seasonal/Technical Sector Trends for December 15th 2017 Green: Increase from previous day Red: Decrease from previous day StockTwits @EquityClock Released on Friday CGI Group $GIB, a TSX 60 stock moved above US$54.42 to an all-time high extending an intermediate uptrend. Linamar $LNR.CA moved above $69.91from incremental earnings benefit from purchase of a private company. Technical action by S&P 500 stocks to 10:00: Quiet. No breakouts. Breakdowns: $MET $ORCL Editor’s Note: After 10:00 AM, breakouts included MCK, RSG, RTN, INTU, BXP, MTD, GOOG, VFC, LMT, EBAY and AES. No breakdowns. Aerospace/Defense ETF $PPA moved above $53.90 to an all-time high extending an intermediate uptrend. Alphabet $GOOG, one of the FAANG stocks moved above $1,062.38 to an all-time high extending an intermediate uptrend. More “gassy” stocks and ETFs breaking intermediate support: $ECA $ECA.CA $FCG Canada Manufacturing Sales higher by 0.5% (NSA) in October, a third of the average increase. #CAD $CDNECON $MACRO Empire #Manufacturing Survey closes the year positive at +4.3. Average December level: -6.8. #Economy $MACRO Industrial Production lower by 0.3% (NSA) in November, much better than 1.0% average decline. #IP #Economy $MACRO Huge comeback for retail sales puts 2017 on track for one of best years on record. http://www.equityclock.com/2017/12/14/stock-market-outlook-for-december-15-2017/ $STUDY Disclaimer: Seasonality and technical ratings offered in this report and at www.equityclock.com are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed