Skip to main content

The TSX ticker is shown in Toronto on May 10, 2013. THE CANADIAN PRESS/Frank Gunn

Frank Gunn/The Canadian Press

The S&P/TSX Composite was flat for the trading week ending with Thursday’s close – lower by less than 0.04 per cent. The benchmark stands 2.7 per cent lower for 2018.

In terms of technical analysis, the index’s Relative Strength Index (RSI) of 58.9 leaves it much close to the overbought sell signal of 70 than the oversold RSI buy signal of 30.

There are only two officially oversold, technically attractive index constituents this week in Cineplex Inc. and Chorus Aviation Inc.

Story continues below advertisement

I picked senior care provider Extendicare Inc. as the focus chart even though, with an RSI of 30.6, it’s not quite below the buy signal of 30. The stock has been trading in a narrow-ish band between $7.00 and $10.50 over the past two years.

RSI buy signals have a mixed-to-mediocre record in uncovering profitable buying opportunities for Extendicare. A buy signal in June 2016 worked extremely well as the stock rallied almost 40 per cent to March 2017. Another buy signal in August 2017 marked a slowdown in selling pressure but the price refused to rally.

In November of 2017, the stock did respond to a buy signal but only very briefly before resuming its path lower. A January 2018 buy signal was followed by a similar non-result. At the end of February, a buy signal was followed by a significant rally but the price is now re-testing the recent lows.

The next few trading sessions will be interesting even if past history makes the RSI buy signal unreliable. If the re-test of the end of February low of $8.12 doesn’t end up with price going below that level, there could be a short-term bounce in store.

As always, investors should complete fundamental research before making any market transactions.

There are eight overbought, technically vulnerable index stocks according to RSI this week. Baxtex Energy Corp. is the most overbought stock in the S&P/TSX Composite, followed by Mitel Networks Corp, Celestica inc., Parex Resources Inc., MEG Energy Corp., Parkland Fuel Corp. and Kelt Exploration Ltd.

NAMERSI 14dPX lastMOV_AVG_200DLAST_CLOSE_TRR_1WKLAST_CLOSE_TRR_YTDPE_RATIOBEST_PE_RATIO
CGX-TCINEPLEX INC26.6484528.1736.3497-7.299078-23.173629.2950775321.29251701
CHR-TCHORUS AVIATION INC28.174617.528.71835-6.582123-20.598856.1665172727.408866995
EXE-TEXTENDICARE INC30.624028.119.022825-2.409535-9.66794523.63762917#N/A N/A
NAMERSI 14dPX lastMOV_AVG_200DLAST_CLOSE_TRR_1WKLAST_CLOSE_TRR_YTDPE_RATIOBEST_PE_RATIO
BTE-TBAYTEX ENERGY CORP79.753315.743.72570.701754452.2546436.19532722#N/A N/A
MNW-TMITEL NETWORKS CORP77.8319214.3310.82535-0.278357738.05395#N/A Field Not Applicable11.56203001
CLS-TCELESTICA INC74.4524215.0214.099458.05755413.9605511.678258179.656815066
PXT-TPAREX RESOURCES INC74.2757522.0616.97350.0453514821.4757713.99777362#N/A N/A
MEG-TMEG ENERGY CORP73.249536.995.3504755.90909135.992229.605157614#N/A N/A
PKI-TPARKLAND FUEL CORP73.1493531.3927.275655.69023618.4759829.57933027#N/A N/A
KEL-TKELT EXPLORATION LTD71.38668.426.961752.55785617.10709#N/A N/A101.4457831
NVA-TNUVISTA ENERGY LTD71.358878.767.595452.2170369.22693320.561160624.67605634
CCO-TCAMECO CORP71.3528114.412.137211.1969124.03101#N/A N/A38.5026738
TSGI-TSTARS GROUP INC/THE71.0998842.4429.18056.79416245.0940226.7013109413.84279555

Source: Bloomberg/Scott Barlow

Report an error Editorial code of conduct
Tickers mentioned in this story
Unchecking box will stop auto data updates
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.
Cannabis pro newsletter