Below is a chart of Helmerich & Payne (HP) from 1981 to 2019 reflecting the year-over-year (YoY) percentage change.
- Japan
- Market Indicator
- Price Momentum Indicators
- Richard Russell
- Silver
- Speed Resistance Lines
- U.S. Dividend Watch List
Author Archives: nlo-admin
Hang Seng Index: October 2019
Below are the remaining downside targets for the Hang Seng Index when applying Dow Theory: Continue reading
Posted in Dow Theory, downside, Hang Seng Index, HSI
Shanghai Composite: Upside Targets
Below are the upside resistance targets for the Shanghai Composite Index for both the short and long-term moves.
Short-Term Targets
Based on the price action since January 2019, the Shanghai Composite Index has conformed to the upside resistance targets ranging from 3,012.38 to 3,378.93.
The short-term upside resistance target determines market sentiment for achieving the 3,559.47. So far, the market appears on course to achieve a re-test of the prior low at 2,464.36. The theory of the re-test is known as a double top, or in this case a double bottom, as described by Charles H. Dow in 1901.
"Another method is what is called the theory of double tops. Records of trading show that in many cases when a stock reaches top it will have a moderate decline and then go back again to near the highest figures. If after such a move, the price again recedes, it is liable to decline some distance (Dow, Charles H. Wall Street Journal. July 20, 1901.)."
The expectation should be that after obtaining a new low or a new peak, the price will trend in the opposite direction and then re-test the prior extreme level. In this case, it is the 2,464.36. This makes the 3,012.38 upside resistance level a reasonable level for expectation on the way to the down from the current level as diagramed in the chart above.
Long-Term Targets
The most important factor to watch for is the long-term trend in the Shanghai Composite. The chart below outlines the long-term prospects for the index. Continue reading
Dow Theory: October 4, 2019
In the chart below, we see two different stocks showing strongly bullish reversal patterns in the period from July 2017 to October 2019.
The line in red saw a bottom in September 2018 while the line in blue saw a bottom in July 2019. Adding strength to the direction of these two stocks is the persistent inability of the stocks to decline below the yellow support lines. Especially encouraging is the blue line having the ability to bounce in September 2019 and move sharply higher since that time.
Except, the chart above isn’t a couple of stocks and the yellow lines aren’t bullish trends. Instead, the red line is the Dow Jones Transportation Average and the blue line is the Dow Jones Industrial Average. The chart is the inverse of the actual pattern and shows what the two indexes have done in the last couple of years.
If a stock market analyst is in agreement that the charts at the beginning of this post is showing a bullish reversal pattern then the same analyst should view the actual charts of the same two indexes as exhibiting bearish reversal patterns from the prior trend.
The bear market continues until the dashed red and blue lines are exceeded to the upside. How do we know we are in a bear market? The inability of the two market indexes to exceed the prior peaks is one indication. The other indication is best stated by Charles H. Dow regarding the formation of a line:
“Such a narrow fluctuation, to the experienced student of the averages, may be as significant as a sharp movement in either direction. (Rhea, Robert. The Dow Theory. Barron’s. 1932. page 82.).”
At present, a market that meanders sideways or down must earn the patient investor income. For now, there is some time (approximately 3-4 months; if successful) that will have to pass before the upside targets are defied.
Lancaster Colony 10-Year Targets
Below are the valuation targets for Lancaster Colony (LANC) over the next 10 years. Continue reading
Charles Schwab 10-Year Targets
Below are the valuation targets for Charles Schwab (SCHW) over the next 10 years. Continue reading
YoY: Charles Schwab
Below is a chart of Charles Schwab (SCHW) from 2004 to 2019 reflecting the year-over-year (YoY) percentage change.
YoY: Pentair plc
Below is a chart of Pentair plc (PNR) from 1974 to 2019 reflecting the year-over-year (YoY) percentage change.
U.S. Dividend Watch List: Top 5 by Ratios
Below is the breakdown of top 5 stocks from our September 27, 2019 list based on the fundamental ratios that we track. Continue reading
U.S Dividend Watch List: September 27, 2019
The market is trying to find its footing and closed the week slightly lower than it began. From the chart, the index is approaching the 50-day moving average which may provide a short-term support. Anyone seeking to go long at this moment should utilize the list below as a starting point for your research. Continue reading
Posted in Dividend Achiever Watch List, Dividend Achievers, Dividend Watch List
Tagged members
Canadian Watch List: September 2019
Below is the Watch List for September 2019. Continue reading
Review: Canadian List Sept 2018
The table below outlines the performance of the top five of the Canadian Dividend Watch list for September 2018.
The orange circles indicate where, among the top five, the performance was improved if the top 2nd, 3rd and 4th stocks were selected instead of buying the top five.
A very important observation is taking the performance of the top five low yield stocks and the top five high yield stocks. According to the Dogs of the Dow investment strategy, selecting the top ten stocks with the highest yield will result in higher performance than the representative index. In this case, the Toronto Stock Exchange is the index we compare the performance to.
In the case of the high yield stocks, they generated returns of –16.23% while the low yield stocks generated returns of +16.35%. The chasm in performance between the two is wide, deep, and consistent on a historical basis.
We are confident that if you are an investor seeking average returns then you will not find it in the group of the highest yielding stocks. In addition, low yielding stocks are able, on a consistent basis, to provided competitive returns year in and year out, as confirmed in our work of the same stocks in the Dow Jones Industrial Average since 1996.
Dogs of the TSX 60: September 2019
Below we list the performance of the various categories of the TSX 60 as compared to the Toronto Stock Exchange from January 1, 2019 to September 27, 2019.
The best performing group was the top 1,2,3 stocks which gained +77.56% year to date. The worst performing group was the top 1,2,3 stocks in the lowest p/e ratio category.
On January 1, 2019, we said the following of the TSX 60:
“Unlike the Dogs of the Dow, The Dogs of the TSX 60 have the best performers in the ‘high yield,’ ‘low p/b,’ and ‘low p/e.’ Our preference is for stocks within the low yield grouping.”
The lowest yielding stocks performed as expected by coming close to matching the index in the top ten and beating the index in the remaining grouping.
The category to beat going forward is the lowest p/b group.
Posted in Dogs of the TSX
Dogs of the Dow: September 2019
Below we list the performance of the various categories of Dow Jones Industrial Average stocks as compared to the index.
The category highlighted in red is the original “Dogs of the Dow” where the ten highest yielding stocks are bought and held for one year and sold at the end of the year. So far, the Dow is beating the Dogs of the Dow by almost 5%.
When contrasting the performance of the Dogs of the Dow against taking the opposite category, stocks providing the lowest dividend yield, we see that across all groupings, the Dogs of the Dow consistently underperform.
For each group, the data set that is thought to be “bad” generally outperformed the category that typically is thought to be “good.” For example, the highest p/e stock bet lowest p/e stocks, lowest yield stocks beat highest yield stocks and highest p/b stocks beat out lowest p/b stocks (except top 2,3,4) .
Worth noting is the fact that the top 2,3,4 group of stocks only outperformed the top 1,2,3 group of stocks in both of the p/e categories. This is a stark contrast to what we indicated occurred in prior years of data.
Posted in Dogs of the Dow
YoY: iShares MSCI Japan Small-Cap ETF
Below is a chart of iShares MSCI Japan Small-Cap ETF (SJC) from 2008 to 2019 reflecting the year-over-year (YoY) percentage change.
