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Three top picks from TimingTheMarket.com’s Don Vialoux

Freelance columnist Don Vialoux

J.P. MOCZULSKI/j.p. moczulski The Globe and Mail

Don Vialoux is a technical analyst with TimingTheMarket.ca & EquityClock.com. His focus is technical analysis and seasonal investing.

Top Picks:

iShares Transportation Average (IYT-N)

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The current period of seasonal strength for the sector is from the beginning of October to the first week in January. Technical parameters currently are positive (upward intermediate trend, positive strength relative to the S&P 500 Index, positive short term momentum). The sector will benefit from lower fuel costs.

Market Vectors Agribusiness ETF (MOO-N)

The current period of seasonal strength is from the beginning of October to the first week in January. Technical parameters currently are positive (upward intermediate trend, positive strength relative to the S&P 500 Index, positive short term momentum). The sector will benefit from a recovery on grain prices.

BMO Equally Weighted Global Metals ETF (ZMT-T)

The current period of seasonal strength is positive from the middle of November to at least the first week in January. Technical parameters currently are positive (upward intermediate trend, positive strength relative to the S&P 500 Index, short term momentum indicators are trending up). The sector will benefit from higher base metal prices triggered by greater demand from China.

Past Picks: Oct. 14, 2016

iShares Global Agriculture ETF (COW-T)

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Then: $34.29 Now: $35.39 3.20% Total return: 3.20%

United State Natural Gas Fund (UNG-N)

Then: $9.43 Now: $7.59 -19.51% Total return: -19.51%

First Trust U.S. Technology ETF (FHQ-T)

**Did not start trading until Oct. 17**

Then: $23.30 Now: $24.17 3.73% Total return: 3.73%

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Total Return Average: -4.19%

Market outlook:

[Tuesday] is an important day for North American equity indexes. Three possibilities available: Hillary wins and equity markets move higher, Trump wins and equity markets move lower, results of the election are contested due to a variety of reasons (recounts, terrorist interference, claims of voter interference) and equity market move lower.

The more important question is what happens after the initial market response. History shows that U.S. equity markets move higher (on average 3 per cent) between the day after Election Day and Inauguration Day (Jan. 20) when investors anticipate at least partial approval of the President's new mandate by Congress. However, reality strikes shortly after when investors realize that Congressional action on the mandate will not come quickly. U.S. equity markets move lower into late January/March. Thereafter, U.S. equity markets have a history of moving higher.

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