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What the charts say

How technical indicators fared in a volatile 2011 Add to ...

Let’s look back on the performance of the 52 stocks submitted last year for the weekly column “What the Charts Say.” As usual, this report will cover a 12-month period from the beginning of December, 2010, to the same point in 2011, to allow the most recent suggestions time to mature.

2011 was a volatile year for North American stock markets. The U.S. market, as measured by the S&P 500 index, rallied 12.9 per cent to late-April, declined 19.2 per cent to Oct. 4, and then rallied 13.4 per cent to Dec. 1, to close up 3.4 per cent for this period. At the same time, the Toronto market, as measured by the S&P/TSX composite index, rose 9.0 per cent, declined by 22.0 per cent and rallied by 9.2 per cent to close the period with a loss of 7.2 per cent.

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Twenty-nine of the 48 “buy” recommendations were closed out during the period. Six of these appreciated for an average of 10.2 per cent, while the others were kept at a reasonably minimum loss (an average of -5.5 per cent) due to the proficient use of stop-loss measures. Our stop-loss system worked impeccably when the Sino-Forest position was stopped out at $25.31 (an almost 9-per-cent gain) before it collapsed and was delisted.

Among the remaining 19 positions, 15 are well ahead for an average gain of 6.9 per cent, and only four are currently at a loss (statistics do not include dividends).

Of the four “sell” recommendations (all U.S. stocks), three were closed out for a 9-per-cent average gain and the fourth lost 4 per cent.

Where will the ideas come from in 2012? Both markets had significant lows last October and have risen ever since. January was an especially strong month in New York; it could well be the harbinger for this year. The Dow Jones industrial average has already hit a 3½ year high and numerous stocks in the information technology (Intel, Microsoft, Dell ) and the health care sector (Bristol-Myers Squibb, Merck ) show improved activity.

At the same time, the Toronto market is still lagging, since neither the energy nor the financial sectors currently provide leadership – although this will probably change – as there are technical signs suggesting renewed strength in Cenovus Energy, Imperial Oil and Penn West Petroleum. Other candidates may come from utilities such as Emera, Enbridge and Fortis.

Happy investing for 2012!

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‘Buy’ Recommendations

Date

Company

Ticker

Price

Price 31/1/12

Price when closed

Date closed

Gain/Loss

2010-12-04

Corus Ent.

CJR.B-T

21.76

20.83

22.35

2011-02-25

2.7%

2010-12-11

Bank of Nova Scotia

BNS-T

56.00

51.53

58.95

2011-05-20

5.3%

2010-12-18

Siemens

SI-N

122.34

94.29

127.57

2011-06-10

4.3%

2010-12-24

Aurizon Mines

ARZ-T

7.22

5.58

6.97

2011-01-07

-3.5%

2012-01-01

Bristol-Myers Squibb

BMY-N

26.48

32.24

  

21.8%

2011-01-08

AT&T

T-N

28.85

29.41

  

1.9%

2011-01-15

American Tower

AMT-N

49.85

62.04

  

24.5%

2011-01-22

National Bank

NA-T

69.68

72.76

75.74

2011-07-29

8.7%

2011-01-29

Bemis

BMS-N

32.37

31.28

30.89

2011-08-03

-4.6%

2011-02-05

Suncor

SU-T

40.61

34.54

39.39

2011-05-13

-3.0%

2011-02-12

CCL Industries

CCL.B-T

33.80

31.73

31.24

2011-08-02

-7.6%

2011-02-19

Cdn. Natural Res.

CNQ-T

47.25

39.72

45.44

2011-04-13

-3.8%

2011-02-26

Valspar

VAL-N

38.20

43.24

36.82

2011-06-06

-3.6%

2011-03-05

Westjet Airlines

WJA-T

15.48

12.50

14.25

2011-06-10

-7.9%

2011-03-12

Brinker Int'l

EAT-N

24.79

25.85

23.31

2011-08-03

-6.0%

2011-03-19

Sino-Forest

TRE-T

23.28

0.00

25.31

2011-05-13

8.7%

2011-03-26

Foot Locker

FL-N

19.86

26.24

  

32.1%

2011-04-02

Toll Brothers

TOL-N

19.76

21.81

19.20

2011-08-03

-2.8%

2011-04-09

JC Penney

JCP-N

37.20

41.55

35.04

2011-06-01

-5.8%

2011-04-16

Wolverine World Wide

WWW-N

38.22

39.09

37.12

2011-08-03

-2.9%

2011-04-23

Stantec

STN-T

29.78

27.90

27.90

2011-08-02

-6.3%

2011-04-30

IGM Financial

IGM-T

48.67

44.80

46.06

2011-08-05

-5.4%

2011-05-07

Centerra Gold

CG-T

18.60

19.85

18.50

2011-12-15

-0.5%

2011-05-14

Progress Energy

PRQ-T

13.01

10.62

12.72

2011-08-09

-2.2%

2011-05-21

Amcol Int`l

ACO-N

35.27

28.56

32.05

2011-07-22

-9.1%

2011-05-28

AT&T

T-N

31.29

29.41

  

-6.5%

2011-06-04

Canadian Tire

CTC.A-T

61.36

64.26

59.80

2011-07-26

-2.5%

2011-06-11

Royal Dutch Shell

RDS.A-N

68.80

71.36

64.58

2011-08-04

-6.1%

2011-06-18

Kimberly-Clark

KMB-N

66.22

71.56

  

8.1%

2011-06-25

Minefinders

MFL-T

11.91

14.19

15.65

2011-09-23

31.4%

2011-07-02

General Mills

GIS-N

37.35

39.83

  

6.6%

2011-07-09

Mastec

MTZ-N

21.15

16.29

18.01

2011-08-04

-14.8%

2011-07-16

Jean Coutu Group

PJC.A-T

11.88

13.38

  

12.6%

2011-07-23

ABB Ltd.

ABB-N

24.57

20.83

21.95

2011-08-04

-10.7%

2011-07-30

Valero Energy

VLO-N

25.12

23.99

23.26

2011-08-03

-7.4%

2011-08-06

McGraw-Hill

MHP-N

41.72

46.00

  

10.3%

2011-09-03

Centerra Gold

CG-T

20.98

19.85

20.07

2011-12-14

-4.3%

2011-09-10

Unilever

UN-N

31.37

33.35

  

6.3%

2011-09-17

Rogers Communication

RCI.B-T

37.22

38.55

  

3.6%

2011-09-24

TransAlta

TA-T

21.81

20.36

  

-6.6%

2011-10-08

Vista Gold

VGZ-T

3.53

3.79

  

7.4%

2011-10-15

Alimentation Couche-Tard

ATD.B-T

30.35

30.45

  

0.3%

2011-10-22

Aurico Gold

AUQ-T

9.18

9.49

8.92

2011-11-16

-2.8%

2011-10-29

Yamana Gold

YRI-T

15.40

17.35

  

12.7%

2011-11-05

Tesoro

TSO-N

28.80

25.03

  

-13.1%

2011-11-12

eBay

EBAY-Q

31.76

31.60

  

-0.5%

2011-11-19

American Electric Power

AEP-N

38.56

39.56

  

2.6%

2011-11-26

McDonalds

MCD-N

92.10

99.05

  

7.5%



‘Sell’ recommendations

Date

Company

Ticker

Price

Price 31/1/12

Price when closed

Date closed

Gain/Loss

2011-08-13

Canadian Pacific

CP-T

59.1

71.84

52.27

2011-10-07

11.6%

2011-08-20

Citigroup

C-N

26.77

31.97

27.84

2011-10-11

-4.0%

2011-08-27

Bonterra Oil & Gas

BNE-T

48.99

54.50

44.09

2011-10-04

10.0%

2011-10-01

National Bank

NA-T

69.89

76.35

66.50

2011-12-01

4.9%

Source: Phases & Cycles Inc.





Monica Rizk is the senior technical analyst for Phases & Cycles Inc. ( www.phases-cycles.com). Ron Meisels is a contributor to the www.NA-marketletter.com website. They may hold shares in companies profiled. Please see the site for a glossary.

Follow us on Twitter: @RonsBriefs, @Monicarizk1

 
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