Is Trouble Ahead For Canadian Stocks?

While Canadian stocks have been setting new highs, it appears some headwinds may be approaching for our northern neighbor. If we were to look at just the pure price action then things would look pretty good for the iShares Canada ETF($EWC). Price has broken above the previous high set in 2011. However, it’s when we look under the surface that we can see some problems.

The chart below shows EWC on a weekly basis going back to late 2010. On the top panel I’ve included the Relative Strength Index (RSI) which is a momentum indicator. Two weeks ago Canadian stocks made an attempt to break its July high but ended up producing a false break as price was unable to hold above $32.90. We also saw the RSI indicator make a lower high, creating a divergence with price.

Read the rest and see the chart at See It Market

Disclaimer: Do not construe anything written in this post or this blog in its entirety as a recommendation, research, or an offer to buy or sell any securities. Everything in this post is meant for educational and entertainment purposes only. I or my affiliates may hold positions in securities mentioned in the blog. Please see my Disclosure page for full disclaimer. Connect with Andrew on Google+, Twitter, and StockTwits.

Is Canada Ready To Rebound?

On Monday we saw strong relative performance out of Canadian equities during the market sell-off that pushed U.S. stocks 2+% lower. This has pushed the ratio between the Canadian ETF ($EWC) and the S&P 500 ($SPX) up to resistance, making this the topic of my TraderPlanet article for this week.

Here’s a piece:

Looking at the relative performance chart of $EWC and $SPY, we can see that when the green line is falling, $SPY is rising more or falling less than $EWC. With Monday’s bullish relative move in $EWC we are now approaching the multi-month trend line since October of last year. We also have a bullish divergence in the Relative Strength Index (RSI), a momentum indicator. As the ratio between these two equity ETFs made lower lows, the RSI indicator began to make higher lows which is a positive sign for Canadian equities relative to U.S. equities.

Read the rest: Is Canada Ready To Rebound? (TraderPlanet)

Disclaimer: Do not construe anything written in this post or this blog in its entirety as a recommendation, research, or an offer to buy or sell any securities. Everything in this post is meant for educational and entertainment purposes only. I or my affiliates may hold positions in securities mentioned in the blog. Please see my Disclosure page for full disclaimer. Connect with Andrew on Google+, Twitter, and StockTwits.

Can Canada Overcome Roadblocks?

My article for TraderPlanet for this week takes a look at the latest price action in Canada, specifically the iShares Canada ETF ($EWC) and the level of resistance it’s butting up against right now.

Here’s a piece:

Since March, EWC has been finding resistance at the $28.30 level. If the selling persistence then we can see the rising trend line off the June and August lows could provide a level of support for EWC. It’s interesting to note that at each run up to $28.30 we haven’t seen momentum rocket higher. Only for a brief movement in July did we see the Relative Strength Index break into ‘overbought’ territory, only to retreat the following day.

Read the rest here: ETFs: Can Canada Overcome Roadblocks? (TraderPlanet)

Disclaimer: Do not construe anything written in this post or this blog in its entirety as a recommendation, research, or an offer to buy or sell any securities. Everything in this post is meant for educational and entertainment purposes only. I or my affiliates may hold positions in securities mentioned in the blog. Please see my Disclosure page for full disclaimer. Connect with Andrew on Google+, Twitter, and StockTwits.