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Stock Opinions by Keith Richards

COMMENT
If the economy's doing so well, why are defensive sectors like utilities rising?

To him, it's a sign that maybe the economy's slowing. We're seeing that in the US when you look at sales and such. And it's showing up on the charts when he looks at the sectors. The defensives can be leading indicators.

If you look at the bottom of a market and the bottom of an economy, it's the growth stuff that'll pick up a little early as smart money starts picking it up. So just maybe smart money is starting to move out of high beta and into defensives.

Unknown
COMMENT
A Comment -- General Comments From an Expert
The VIX.

We just made a new high on the S&P. As a technical guy, he can't ignore that. He's in. But there are signs, such as the VIX, which is hovering around 12, very low. 

Historically, if it stays below 12.5 for too long, you almost always end up with a market correction. Don't worry about a few days, but if you get a cluster it means there's complacency in the market and you ought to be worried. He's a bit concerned, given how fast things are moving these days.

Unknown
COMMENT
TSX hitting record high.

Yes, and that's largely looking at resources like gold and stuff. TSX has a slightly different profile than the S&P 500, which is mostly high-beta tech.

Unknown
COMMENT
S&P 500 -- where's the new ceiling going to be?

It's interesting. In his blog, he said that he thought the market would pause around 5150. It went right through 5200, the old high, and here we are just over 5300. It doesn't matter what he thinks or says, the market's going to do what it's going to do.

You're not allowed to have a theme. You have to follow what the tape is telling you. The tape's telling us that it's a new high, with more momentum moving into the market. For the time being, we must remain bullish. He's still long the market, but there are signs telling him that things are a bit stretched, and that the party could end in the next month or two. We'll see.

Nothing's absolute. The tape's the tape. If it's over 5200, he has to stay long the market. But he's aware of the signs and, just as in Star Trek, he's prepared to "take evasive action" and move. Keep an eye, but don't argue with the tape.

Unknown
COMMENT
A Comment -- General Comments From an Expert
Oil.

He loves oil. Seasonally, can take a pause over the summer. And after the move we've seen, likely to see it move sideways or even a pullback. Longer run, say 1-2 years, he's very bullish. 

Thinks it will get back to $100. Tons of potential for it to get there, and lots of resistance space before it does. Have to break though $88-90, and once it does, $100. Then who knows, $120 and beyond. One thing at a time. Seasonally, seeing it a little soft now. End of the summer, should start to see it pick up.

See his blog. He writes a lot about commodities there.

Unknown
BUY ON WEAKNESS

Great company. Looking at the chart, big wall of resistance it just couldn't get through. Then it broke out. If you own it, hold. If it pulls back to the neckline, he'd be all over it.

oil / gas
BUY ON WEAKNESS
MEG Energy Corp

More defined uptrend than other charts, starting to pull back. Might pull back to the trendline, but by just a few percentage points, not a crash and burn on the sector. Great point to add to or start positions.

oil / gas
BUY ON WEAKNESS

Great-looking profile. Uptrend since 2022, got overbought, now pulling back. Healthy right here. If you own it, hold, and look to buy more.

computer software / processing
WAIT
Barrick Gold

Laggard compared to other stocks and to gold itself. Mystery as to why it's not breaking out, but it's probably something fundamental. A wall around $19-20, needs to break that. 

Good news is that the lows aren't getting lower. It's in a trading band. You can buy when it moves to the bottom and trade the bands, or you can buy on a breakout.

precious metals
BUY ON WEAKNESS

Good company. Typically over the summer, you see tech underperform for a while. Seasonals are just a tendency, not an absolute. Trendline since October 2022, now testing it. If you own, hold. Could be an opportunity to buy, but he's not buying yet, as it may waffle a bit during summer.

Technology
WAIT
NVIDIA Corporation

Trendlines are great, but you have to watch when things go parabolic. Stocks tend to consolidate after that. This stock likes to do these big jumps. Seasonal slowness for high beta is coming. Nothing bearish about the chart. When it catches up to the trendline and the 200-day MA, it will be a buying opportunity.

computer software / processing
WATCH

Gently sloping uptrend since October 2022, but has now jumped up off trendline. Could be considered overbought, but you have to watch momentum indicators. He really likes the money flow indicator you can get from stockcharts.com.

He uses a weekly chart for momentum. If it's overbought, he lets it rest awhile. Could be starting a pullback, when it would be a good opportunity to buy.

publishing / printing
COMMENT
A Comment -- General Comments From an Expert
ADRs.

American Depository Receipts. Foreign stocks, usually giant companies. If you own an ADR, and the currency in the original country declines, that could affect the stock price. So you do have to take into account potential currency moves. Before buying, he looks at the chart of the country's currency.

Unknown
BUY
Eli Lilly & Co.

Chart's in an uptrend. Nothing nasty going on. Flattening, pulling back a bit. Good chart. Keep owning, and you could actually add to your position. Healthcare's not doing too badly as a sector.

biotechnology / pharmaceutical
COMMENT
Upcoming seasonality sectors.

He's a technical guy first. Does respect and use seasonality, using it as a background. Consumer staples and utilities are defensives, but also tend to do OK during the summer on a relative basis. Look there first. They're leading the market right now, they're defensive, and primed for seasonality.

Unknown
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