GPAG Technical Analysis

Transcription

1 Technical Analysis Global Portfolio Advisory Group GPAG Technical Analysis Friday, May 19, 217 Global Portfolio Advisory Group, Scotia Capital Inc. Gord Wiesemann / (416) gord.wiesemann@scotiawealth.com Indexes Index Short Term Trend Medium Term Trend Support Resistance TSX Composite Bear* Bull 15175, , 1567 S&P5 Bull Bull 234, , 2525 Nasdaq Bull Bull 5535, , 5725 DJIA Bull Bull 238, , 217 * Change in status Market Sector Trend Breakdown Total US Sectors Analyzed: 9 Bull confirmed or pending: 7 Technology, Industrials, Materials, Consumer discretion, Utilities, Health care, Consumer staples Total CDN Sectors Analyzed: 12 Bull confirmed or pending: 7 Consumer staples, Industrials, Info tech, Consumer discretion, Real estate, Utilities, Telecom Bear confirmed or pending: 2 Energy, Financials Bear confirmed or pending: 5 Energy, Health care, Financials, Materials, Global gold Influential Market Sample Product Short Term Trend Medium Term Trend Support Resistance Gold Bull Sideways 1236, , 1264 Crude Oil Bear Bull 48., , 49.8 Canadian Dollar Bear Sideways.726, * Change in Status Please be advised that this material is not to be distributed to residents of the European Union Registered trademark of The Bank of Nova Scotia, used under license. Trademark of The Bank of Nova Scotia, used under license. Scotia Wealth Management consists of a range of financial services provided by The Bank of Nova Scotia (Scotiabank ); The Bank of Nova Scotia Trust Company (Scotiatrust ); Private Investment Counsel, a service of 1832 Asset Management L.P.; 1832 Asset Management U.S. Inc.; Scotia Wealth Insurance Services Inc.; and ScotiaMcLeod, a division of Scotia Capital Inc. Wealth advisory and brokerage services are provided by ScotiaMcLeod, a division of Scotia Capital Inc. Scotia Capital Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. 1

2 Action and Changes In the US, what appears to be a never ending stream of political discord originating in the White House is beginning to have an impact on market confidence as the S&P5, the Dow, and the Russell2 all find themselves struggling to forge through key resistance levels. Concerns are slowly rising that the persistent need for damage control will distract from the Administration s ability to craft and present its legislative agenda. Here at home we face an increasing degree of attention on pricing and lending practices in our residential housing market and ultimately its significance to the wider economy. Now to be fair, the economic data as reported in the US and Canada remains more or less robust but with the charts showing confidence waning just as a period of seasonal weakness dawns, now might not be a bad time to take the technical cues as a signal to reign in new capital and wait for what could be a material retracement in some of the benchmark stock indexes as the summer months unfold. For the past few issues of my technical update I ve included a focus on the long term median rates of climb on the major stock indexes as well as some select sectors and businesses. The reason I ve done this is simply to reinforce a technical observation I ve made over many years that suggests markets inevitably tend to return to their medians. The timing of this development is of course the key to this being a profitable bit of knowledge but that of course is also the most difficult, if not nearly impossible aspect to ascertain with consistent accuracy. Without the benefit of precise timing, generally it can be considered better to be early than late in acknowledging this tendency. Comparatively speaking, Europe (as per the EuroStoxx5 and the FTSE Euro 1) and Emerging Markets indexes are much closer to both their simple medians as well as projected median rates of climb than their North American counterparts which by contrast currently reside significantly above these measures. In and of itself this comparison supports GPAG s strategy to overweight international equities and there are no technical suggestions that the relative outperformance in Europe and EM is about to end. If stock indexes were to return to within proximate range of their medians, this performance differential in fact should only amplify. In addition to a market s tendency to revert to its median, by my own observations a market will also tend to overcorrect lower in much the same way as it responds with excessive enthusiasm on the top side. Technicals are after all a mathematical representation of market psychology so excess enthusiasm, even outside of markets, tends to be corrected by excessive pessimism. At this time I must point out that we have progressively waning momentum readings since last December on most of the major North American benchmarks and this is occurring as we reach significant and influential long term resistance. Add to this the fact that it is occurring at a point well above projected rates of climb and we start to rule out the likelihood that the markets will resolve themselves to the upside without heading lower first. Again given the relative upbeat tone of global economic indicators one would have to hope that any corrective phase is orderly and within usual May-September parameters but given the extremely low readings on the VIX as a case in point, there is certainly technical room for overcorrection. The trend breakdown within the US and Canadian market sectors sees only subtle change in the headlines this week with the global gold sector moving to the bear camp on the Canadian side but there are many technical vulnerabilities among the prevailing bulls on both sides which should be noted for their implications going forward. The US consumer staples, health care, industrials, materials and utilities sectors have all been struggling near resistance with waning momentum readings. Trend conditions would still be considered bullish but that status condition masks the fact that moving averages have been converging negatively and as already noted, momentum has been declining and nonconfirming of any recent highs. This action mirrors that of the overall S&P5, Dow and Russell so the heavy lifting has Please be advised that this material is not to be distributed to residents of the European Union Registered trademark of The Bank of Nova Scotia, used under license. Trademark of The Bank of Nova Scotia, used under license. Scotia Wealth Management consists of a range of financial services provided by The Bank of Nova Scotia (Scotiabank ); The Bank of Nova Scotia Trust Company (Scotiatrust ); Private Investment Counsel, a service of 1832 Asset Management L.P.; 1832 Asset Management U.S. Inc.; Scotia Wealth Insurance Services Inc.; and ScotiaMcLeod, a division of Scotia Capital Inc. Wealth advisory and brokerage services are provided by ScotiaMcLeod, a division of Scotia Capital Inc. Scotia Capital Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. 2

3 been left to just the technology and consumer discretionary sectors. With that in mind, as US household debt effectively reaches levels equivalent to the third quarter of 28 there is certainly some reason to be concerned about the consumer discretionary sector s ability to continue its advance in the face of imminently rising US interest rates. Among the Canadian sectors, the charts show slightly better stability but the recent underperformance of the broader TSX highlights the particularly high weighting of the financial sector as these constituents struggle together as a basket. Otherwise the utilities, telecoms and consumer discretionary sectors offer similar technical issues as their US peers and in much the same respect as in the US, record high household Canadian debt levels could be considered a constraining factor in discretionary purchases going forward. Again, what we find on the charts is a case of momentum studies waning while non-confirming of highs at a time when sector index levels are at or near to key resistance points. After breaking sharply lower on a combination of EIA inventory data and technical conditions a couple weeks back, WTI crude oil prices have staged a technical recovery that remains questionable on the back of a commitment from Saudi Arabia and Russia to extend output cuts into next year. Prices have rebounded to a point that is above the primary, one-year supportive trendline, momentum studies have risen alongside and moving averages still show a subtle inclination to curl upward but so far the price advance has been capped at the 6 day moving average. In this light, the action can only be considered a routine bear market bounce. A daily close above $49.8 in the short term would be bullishly constructive but because of the protracted period of trade earlier in the year that ranged from the low $5 level to the $54 area, there is considerable technical resistance to overcome. The fact that the market had a relatively clear and easy path toward sustained upside price momentum back in December last year but failed to deliver more than a few dollars does not bode well for a rapid rally this time around even if the rest of OPEC affirms its participation in output cuts on May 25 th. Technically it s also significant to note that the 2 year median price for WTI is $48.5 (note: not rate of climb), almost exactly where we trade today. Given that the short to medium term rate of gain is now projected to be only ten degrees in a best case scenario, the confluence of technical factors is beginning to point more and more to a protracted period of range-bound trade near to recent pricing. Technical development on the natural gas chart meanwhile continues in a slow but bullish fashion. Moving averages have presented very modest positive divergence while momentum studies remain weakly positive. The chart remains well supported between $2.98 and $2.62 but also faces fairly strong resistance between $3.5 and $3.85. Seasonal temperature outlooks from the NOAA s climate prediction centre are for normal to slightly above normal temperature ranges for most of the US this summer which, if accurate, could be moderately supportive for natural gas prices. All things considered, the optimal word that can be used to describe the technical outlook is moderate. There are perhaps slightly fewer technical inhibitions to a sustained price gain when compared to the WTI crude oil chart but there are also no indications of powerful setup conditions to imply anything more than a mostly sideways range with a subtle upward tendency. Base metal charts are by and large relatively close to 1 year median price levels so with only a few exceptions we are liable to see mostly steady pricing. Copper is however one of the few exceptions. Prices had been locked into a long term declining wedge pattern from late 211 up until late last year. Since the November/December bull breakout and retest of the trendline, the chart has consolidated around the $2.5 level. The chart would be considered strongly supported at the $2.39 level with resistance points sitting at $2.7 and $2.95. At this time the chart proposes a one year target price somewhere between $3. and $3.18. On the contrasting side of the technical exceptions we find nickel. Prices here have been declining steadily since late 211 and unlike copper, there are no indications that a technical breakout is imminent. In fact, there have been two periods of accumulation in this timeline that created saucer-low Please be advised that this material is not to be distributed to residents of the European Union Registered trademark of The Bank of Nova Scotia, used under license. Trademark of The Bank of Nova Scotia, used under license. Scotia Wealth Management consists of a range of financial services provided by The Bank of Nova Scotia (Scotiabank ); The Bank of Nova Scotia Trust Company (Scotiatrust ); Private Investment Counsel, a service of 1832 Asset Management L.P.; 1832 Asset Management U.S. Inc.; Scotia Wealth Insurance Services Inc.; and ScotiaMcLeod, a division of Scotia Capital Inc. Wealth advisory and brokerage services are provided by ScotiaMcLeod, a division of Scotia Capital Inc. Scotia Capital Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. 3

4 formations with the first concluding in mid-214 with nothing more than a modest and temporary spike whereas more recently at the end of last year, prices responded with a return toward previous market lows. While prices have been steadily below the 1 year median LME price per tonne for the past three years, there are no technical suggestions within either price action or momentum studies that suggests traders are looking at this condition as opportunity. US treasury yields have been falling slightly with geopolitical uncertainties driving some market participants into 1 year US treasuries as a perceived safe haven. Technical comparisons of price action between 2 year, 5 year, 1 year Notes and long bonds is inconsistent, variable and non-confirming which would suggest that the price rises (yield declines) are liable to be transitory and a response to short term developments only. The 1 year Note chart offers key resistance at the 128 level and thus affords still ample room for price appreciation without disrupting the longer term trend toward rising yields. At this time the 5 and 1 year T-Note charts offer the most similar technical patterns while the shorter and longer ends of the curve as reflected by 2 year Notes and long bonds each comparatively lag price-wise and thus still lean toward higher yield prospects. The Canadian dollar has been a particular focus of domestic business headlines lately as it dipped to a new 14 month low last week. There appears to be a feeling within the general population that a country s currency level is a direct representation of its economic health. In Trumpian terms, a strong dollar is winning while a weak dollar is losing. In reality of course, the exchange rate is dependent on many factors and a strong or weak currency can be beneficial or detrimental to importers and exporters to varying degrees so the collective handwringing about the Canadian dollar s exchange level is a little misplaced. To be sure, what an exchange rate does reflect is the expectation for interest rate differentials between currencies. In this respect, the latest dive for the Loonie (specifically on the predominant CAD/USD cross) is representative of market expectations that US rates will rise sooner and now faster than Canadian interest rates. Given that our economy is heavily impacted by the energy market, the bounce in the price of crude oil translated to a rally in the Canadian dollar this week but what we have on the CAD chart is a mere recovery to an influential trendline that has otherwise been pointing to lower CAD since early last year. Crude prices would have to rise not only significantly but also for a sustained period for this to become a longer term motivator for the Canadian dollar and as outlined in a previous paragraph here, the technical prospects for crude oil show potential for a relatively modest rise at best. Thus, until the Bank of Canada suggests it is prepared to shift its monetary policy bias to one of tightening (higher rates) or alternatively the US Federal Reserve expresses hesitation in its current path, the Canadian dollar can be expected to follow its entrenched trend that presently targets the.718 range at a minimum. Crude oil Natural gas Gold Copper Canadian Dollar 1 Year Notes Additional Featured Items Please be advised that this material is not to be distributed to residents of the European Union Registered trademark of The Bank of Nova Scotia, used under license. Trademark of The Bank of Nova Scotia, used under license. Scotia Wealth Management consists of a range of financial services provided by The Bank of Nova Scotia (Scotiabank ); The Bank of Nova Scotia Trust Company (Scotiatrust ); Private Investment Counsel, a service of 1832 Asset Management L.P.; 1832 Asset Management U.S. Inc.; Scotia Wealth Insurance Services Inc.; and ScotiaMcLeod, a division of Scotia Capital Inc. Wealth advisory and brokerage services are provided by ScotiaMcLeod, a division of Scotia Capital Inc. Scotia Capital Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. 4

5 Technical Analysis Global Portfolio Advisory Group Benchmark Indexes 5

6 S&P TSX % 12:: AM VWAP: High: Low: Chg: 2.77% S&P TSX - EMA-6 S&P TSX - EMA-2 S&P TSX - Price Bear trend pending confirmation MACD S&P TSX - MACD Signal (9) S&P TSX - MACD Divergence S&P TSX - Stochastic %D (3) S&P TSX - Stochastic %K (5,3) 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

7 emini S&P 5 (CME) Continuous % 7:11:43 AM VWAP: High: Low: 24.7 Chg: 15.56% emini S&P 5 (CME) Continuous - EMA-6 emini S&P 5 (CME) Continuous - EMA-2 emini S&P 5 (CME) Continuous - Price Bull trend MACD emini S&P 5 (CME) Continuous - MACD Signal (9) emini S&P 5 (CME) Continuous - MACD Divergence emini S&P 5 (CME) Continuous - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

8 DJ 3 Industrials Average % 12:: AM VWAP: High: Low: Chg: 17.8% DJ 3 Industrials Average - EMA-6 DJ 3 Industrials Average - EMA-2 DJ 3 Industrials Average - Price Bull trend MACD DJ 3 Industrials Average - MACD Signal (9) DJ 3 Industrials Average - MACD Divergence DJ 3 Industrials Average - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May , 5. 8

9 emini NASDAQ 1 (CME) Continuous % 7:12:45 AM VWAP: High: Low: Chg: 24.45% emini NASDAQ 1 (CME) Continuous - EMA-6 emini NASDAQ 1 (CME) Continuous - EMA-2 emini NASDAQ 1 (CME) Continuous - Price Bull trend MACD emini NASDAQ 1 (CME) Continuous - MACD Signal (9) emini NASDAQ 1 (CME) Continuous - MACD Divergence emini NASDAQ 1 (CME) Continuous - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

10 EURO STOXX 5 (EUR) % 7:9:15 AM VWAP: High: Low: Chg: 16.2% EURO STOXX 5 (EUR) - EMA-6 EURO STOXX 5 (EUR) - EMA-2 EURO STOXX 5 (EUR) - Price Bull trend MACD EURO STOXX 5 (EUR) - MACD Signal (9) EURO STOXX 5 (EUR) - MACD Divergence EURO STOXX 5 (EUR) - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May 1 4, 2, 69.12

11 DJ Emerging Total Stock Market % 7:11:5 AM VWAP: High: Low: Chg: 19.4% DJ Emerging Total Stock Market - EMA-6 DJ Emerging Total Stock Market - EMA-2 DJ Emerging Total Stock Market - Price Bull trend MACD DJ Emerging Total Stock Market - MACD Signal (9) DJ Emerging Total Stock Market - MACD Divergence DJ Emerging Total Stock Market - Stochastic %D (3) DJ Emerging Total Stock Market - Stochastic %K (5,3) Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

12 Technical Analysis Global Portfolio Advisory Group TSE/TSX Sector Trends 12

13 S&P TSX Capped / Consumer Discretionary % 12:: AM VWAP: High: Low: Chg: 16.51% S&P TSX Capped / Consumer Discretionary - EMA-6 S&P TSX Capped / Consumer Discretionary - EMA-2 S&P TSX Capped / Consumer Discretionary - Price Bull trend MACD S&P TSX Capped / Consumer Discretionary - MACD Signal (9) S&P TSX Capped / Consumer Discretionary - MACD Divergence S&P TSX Capped / Consumer Discretionary - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

14 S&P TSX Capped / Consumer Staples % 12:: AM VWAP: High: Low: Chg: 6.43% S&P TSX Capped / Consumer Staples - EMA-6 S&P TSX Capped / Consumer Staples - EMA-2 S&P TSX Capped / Consumer Staples - Price 58. Bull trend MACD S&P TSX Capped / Consumer Staples - MACD Signal (9) S&P TSX Capped / Consumer Staples - MACD Divergence S&P TSX Capped / Consumer Staples - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

15 S&P TSX Capped / Financial % 12:: AM VWAP: High: Low: Chg: 18.37% S&P TSX Capped / Financial - EMA-6 S&P TSX Capped / Financial - EMA-2 S&P TSX Capped / Financial - Price Bear trend MACD S&P TSX Capped / Financial - MACD Signal (9) S&P TSX Capped / Financial - MACD Divergence S&P TSX Capped / Financial - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

16 S&P TSX Capped / Energy % 12:: AM VWAP: High: Low: Chg: 13.68% S&P TSX Capped / Energy - EMA-6 S&P TSX Capped / Energy - EMA-2 S&P TSX Capped / Energy - Price Bear trend MACD S&P TSX Capped / Energy - MACD Signal (9) S&P TSX Capped / Energy - MACD Divergence S&P TSX Capped / Energy - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

17 S&P TSX Capped / Industrials % 12:: AM VWAP: High: Low: Chg: 24.84% S&P TSX Capped / Industrials - EMA-6 S&P TSX Capped / Industrials - EMA-2 S&P TSX Capped / Industrials - Price Bull trend MACD S&P TSX Capped / Industrials - MACD Signal (9) S&P TSX Capped / Industrials - MACD Divergence S&P TSX Capped / Industrials - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

18 S&P TSX Capped / Materials % 12:: AM VWAP: High: Low: Chg: 6.45% S&P TSX Capped / Materials - EMA-6 S&P TSX Capped / Materials - EMA-2 S&P TSX Capped / Materials - Price Bear trend MACD S&P TSX Capped / Materials - MACD Signal (9) S&P TSX Capped / Materials - MACD Divergence S&P TSX Capped / Materials - Volume 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

19 S&P TSX Capped / Real Estate % 12:: AM VWAP: High: Low: Chg: 5.18% S&P TSX Capped / Real Estate - EMA-6 S&P TSX Capped / Real Estate - EMA-2 S&P TSX Capped / Real Estate - Price Bull trend waning MACD S&P TSX Capped / Real Estate - MACD Signal (9) S&P TSX Capped / Real Estate - MACD Divergence S&P TSX Capped / Real Estate - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

20 S&P TSX Capped / Telecommunications % 12:: AM VWAP: High: Low: Chg: 29.33% S&P TSX Capped / Telecommunications - EMA-6 S&P TSX Capped / Telecommunications - EMA-2 S&P TSX Capped / Telecommunications - Price Bull trend MACD S&P TSX Capped / Telecommunications - MACD Signal (9) S&P TSX Capped / Telecommunications - MACD Divergence S&P TSX Capped / Telecommunications - Volume 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

21 S&P TSX Capped / Utilities % 12:: AM VWAP: High: Low: Chg: 1.48% S&P TSX Capped / Utilities - EMA-6 S&P TSX Capped / Utilities - EMA-2 S&P TSX Capped / Utilities - Price Bull trend MACD S&P TSX Capped / Utilities - MACD Signal (9) S&P TSX Capped / Utilities - MACD Divergence S&P TSX Capped / Utilities - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

22 S&P TSX Capped / Information Technology % 12:: AM VWAP: High: 6.98 Low: 52.6 Chg: 16.82% S&P TSX Capped / Information Technology - EMA-6 S&P TSX Capped / Information Technology - EMA-2 S&P TSX Capped / Information Technology - Price 66. Bull trend MACD S&P TSX Capped / Information Technology - MACD Signal (9) S&P TSX Capped / Information Technology - MACD Divergence S&P TSX Capped / Information Technology - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

23 S&P TSX Capped / Health Care % 12:: AM VWAP: High: Low: 67.2 Chg: -3.45% S&P TSX Capped / Health Care - EMA-6 S&P TSX Capped / Health Care - EMA-2 S&P TSX Capped / Health Care - Price Bear trend waning MACD S&P TSX Capped / Health Care - MACD Signal (9) S&P TSX Capped / Health Care - MACD Divergence S&P TSX Capped / Health Care - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

24 S&P/TSX Equal Weight Global Gold % 12:: AM VWAP: High: Low: Chg: 5.51% S&P/TSX Equal Weight Global Gold - EMA-6 S&P/TSX Equal Weight Global Gold - EMA-2 S&P/TSX Equal Weight Global Gold - Price Bear trend MACD S&P/TSX Equal Weight Global Gold - MACD Signal (9) S&P/TSX Equal Weight Global Gold - MACD Divergence S&P/TSX Equal Weight Global Gold - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

25 Technical Analysis Global Portfolio Advisory Group S&P Sector Trends 25

26 Consumer Discretionary Select Sector % 12:: AM VWAP: High: Low: Chg: 16.25% Consumer Discretionary Select Sector - EMA-6 Consumer Discretionary Select Sector - EMA-2 Consumer Discretionary Select Sector - Price 95. Bull trend MACD Consumer Discretionary Select Sector - MACD Signal (9) Consumer Discretionary Select Sector - MACD Divergence Consumer Discretionary Select Sector - Stochastic %D (3) Consumer Discretionary Select Sector - Stochastic %K (5,3) 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

27 Consumer Staples Select Sector % 12:: AM VWAP: High: Low: Chg: 11.53% Consumer Staples Select Sector - EMA-6 Consumer Staples Select Sector - EMA-2 Consumer Staples Select Sector - Price Bull trend MACD Consumer Staples Select Sector - MACD Signal (9) Consumer Staples Select Sector - MACD Divergence Consumer Staples Select Sector - Stochastic %D (3) Consumer Staples Select Sector - Stochastic %K (5,3) 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

28 Energy Select Sector % 12:: AM VWAP: High: Low: Chg: 9.24% Energy Select Sector - EMA-6 Energy Select Sector - EMA-2 Energy Select Sector - Price Bear trend MACD Energy Select Sector - MACD Signal (9) Energy Select Sector - MACD Divergence Energy Select Sector - Stochastic %D (3) Energy Select Sector - Stochastic %K (5,3) Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

29 Financial Select Sector % 12:: AM VWAP: High: Low: Chg: 28.24% Financial Select Sector - EMA-6 Financial Select Sector - EMA-2 Financial Select Sector - Price Bear trend pending confirmation MACD Financial Select Sector - MACD Signal (9) Financial Select Sector - MACD Divergence Financial Select Sector - Stochastic %D (3) Financial Select Sector - Stochastic %K (5,3) Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

30 Materials Select Sector % 12:: AM VWAP: High: Low: Chg: 4.4% Materials Select Sector - EMA-6 Materials Select Sector - EMA-2 Materials Select Sector - Price Bull trend MACD Materials Select Sector - MACD Signal (9) Materials Select Sector - MACD Divergence Materials Select Sector - Stochastic %D (3) Materials Select Sector - Stochastic %K (5,3) 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

31 Industrial Select Sector % 12:: AM VWAP: High: Low: Chg: 16.4% Industrial Select Sector - EMA-6 Industrial Select Sector - EMA-2 Industrial Select Sector - Price 7. Bull trend MACD Industrial Select Sector - MACD Signal (9) Industrial Select Sector - MACD Divergence Industrial Select Sector - Stochastic %D (3) Industrial Select Sector - Stochastic %K (5,3) 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

32 Utilities Select Sector % 12:: AM VWAP: High: Low: Chg: 15.53% Utilities Select Sector - EMA-6 Utilities Select Sector - EMA-2 Utilities Select Sector - Price Bull trend MACD Utilities Select Sector - MACD Signal (9) Utilities Select Sector - MACD Divergence Utilities Select Sector - Stochastic %D (3) Utilities Select Sector - Stochastic %K (5,3) 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

33 Technology Select Sector % 12:: AM VWAP: High: Low: Chg: 24.23% Technology Select Sector - EMA-6 Technology Select Sector - EMA-2 Technology Select Sector - Price 58. Bull trend MACD Technology Select Sector - MACD Signal (9) Technology Select Sector - MACD Divergence Technology Select Sector - Stochastic %D (3) Technology Select Sector - Stochastic %K (5,3) Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

34 Health Care Select Sector % 12:: AM VWAP: High: Low: Chg: 8.1% Health Care Select Sector - EMA-6 Health Care Select Sector - EMA-2 Health Care Select Sector - Price Bull trend MACD Health Care Select Sector - MACD Signal (9) Health Care Select Sector - MACD Divergence Health Care Select Sector - Stochastic %D (3) Health Care Select Sector - Stochastic %K (5,3) Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

35 Technical Analysis Global Portfolio Advisory Group Features and Notables 35

36 Crude Oil WTI (NYM $/bbl) Continuous % 7:36:23 AM VWAP: High: Low: Chg: -6.6% Crude Oil WTI (NYM $/bbl) Continuous - EMA-6 Crude Oil WTI (NYM $/bbl) Continuous - EMA-2 Crude Oil WTI (NYM $/bbl) Continuous - Price Bear trend MACD Crude Oil WTI (NYM $/bbl) Continuous - MACD Signal (9) Crude Oil WTI (NYM $/bbl) Continuous - MACD Divergence Crude Oil WTI (NYM $/bbl) Continuous - Volume 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

37 Natural Gas (NYM $/mmbtu) Continuous % 7:37:4 AM VWAP: High: 3.32 Low: 1.94 Chg: 16.91% Natural Gas (NYM $/mmbtu) Continuous - EMA-6 Natural Gas (NYM $/mmbtu) Continuous - EMA-2 Natural Gas (NYM $/mmbtu) Continuous - Price Bull trend MACD Natural Gas (NYM $/mmbtu) Continuous - MACD Signal (9) Natural Gas (NYM $/mmbtu) Continuous - MACD Divergence Natural Gas (NYM $/mmbtu) Continuous - Volume 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

38 Gold (NYM $/ozt) Continuous % 7:35:3 AM VWAP: High: Low: Chg: -.51% Gold (NYM $/ozt) Continuous - EMA-6 Gold (NYM $/ozt) Continuous - EMA-2 Gold (NYM $/ozt) Continuous - Price Bull trend waning MACD Gold (NYM $/ozt) Continuous - MACD Signal (9) Gold (NYM $/ozt) Continuous - MACD Divergence Gold (NYM $/ozt) Continuous - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

39 High Grade Copper (NYM $/lbs) Continuous % 7:36:6 AM VWAP: High: 2.77 Low: 2.8 Chg: -6.52% High Grade Copper (NYM $/lbs) Continuous - EMA-6 High Grade Copper (NYM $/lbs) Continuous - EMA-2 High Grade Copper (NYM $/lbs) Continuous - Price Bear trend MACD High Grade Copper (NYM $/lbs) Continuous - MACD Signal (9) High Grade Copper (NYM $/lbs) Continuous - MACD Divergence High Grade Copper (NYM $/lbs) Continuous - Volume 7/15 1/15 1/16 4/16 7/16 1/16 1/17 4/

40 Canadian Dollar (CME) Continuous % 7:34:53 AM VWAP: High:.77 Low:.74 Chg: -3.9% Canadian Dollar (CME) Continuous - EMA-6 Canadian Dollar (CME) Continuous - EMA-2 Canadian Dollar (CME) Continuous - Price Bear trend MACD Canadian Dollar (CME) Continuous - MACD Signal (9) Canadian Dollar (CME) Continuous - MACD Divergence Canadian Dollar (CME) Continuous - Volume Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May

41 1Y T-Note (CBT) Continuous % 7:38:24 AM VWAP: High: Low: 16.5 Chg: 15.73% 1Y T-Note (CBT) Continuous - EMA-6 1Y T-Note (CBT) Continuous - EMA-2 1Y T-Note (CBT) Continuous - Price MACD 1Y T-Note (CBT) Continuous - MACD Signal (9) 1Y T-Note (CBT) Continuous - MACD Divergence 1Y T-Note (CBT) Continuous - Volume '7 '8 '9 '1 '11 '12 '13 '14 '15 '

42 Global Portfolio Advisory Group Important Disclosures This material does not include or constitute an investment recommendation, and is not intended to take into account the particular investment objectives, financial conditions, or needs of individual clients. Before acting on this material, you should consider whether it is suitable for your particular circumstances and talk to your investment advisor. The author(s) of the report own(s) securities of the following companies. None. The supervisors of the Portfolio Advisory Group own securities of the following companies. None. This report has been prepared by members of the ScotiaMcLeod Portfolio Advisory Group. ScotiaMcLeod is the full service retail division of Scotia Capital Inc General Disclosures The Scotia Wealth Portfolio Advisory Group prepares this report by aggregating information obtained from various sources as a resource for Scotia Wealth Advisors and their clients. Information may be obtained from the Equity Research and Fixed Income Research departments of the Global Banking and Markets division of Scotiabank. Information may be also obtained from the Foreign Exchange Research and Scotia Economics departments within Scotiabank. In addition to information obtained from members of the Scotiabank group, information may be obtained from the following third party sources: Standard & Poor s, Valueline, Morningstar CPMS and Bloomberg. The information and opinions contained in this report have been compiled or arrived at from sources believed reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness. While the information provided is believed to be accurate and reliable, neither Scotia Capital Inc., which includes the Scotia Wealth Management Portfolio Advisory Group, nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of such information. Neither Scotia Capital Inc. nor its affiliates accepts any liability whatsoever for any direct or consequential loss arising from any use of this report or its contents. This report is provided to you for informational purposes only. This report is not intended to provide personal investment advice and it does not take into account the specific investment objectives, financial situation or particular needs of any specific person. Investors should seek advice regarding the appropriateness of investing in financial instruments and implementing investment strategies discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. Nothing contained in this report is or should be relied upon as a promise or representation as to the future. The pro forma and estimated financial information contained in this report, if any, is based on certain assumptions and management s analysis of information available at the time that this information was prepared, which assumptions and analysis may or may not be correct. There is no representation, warranty or other assurance that any projections contained in this report will be realized. Opinions, estimates and projections contained in this report are our own as of the date hereof and are subject to change without notice. Copyright 212 Scotia Capital Inc. All rights reserved 42