In this TSX Breakouts report, there are 47 stocks on the positive breakouts list (stocks with positive price momentum), and 10 securities are on the negative breakouts list (stocks with negative price momentum).
The positive breakout list has a defensive tilt as gold, utilities and consumer staples stocks account for a large part of the list. A notable standout is Toronto-Dominion Bank (TD-T). It is the only bank stock on the positive breakouts list. Year-to-date, TD’s share price is up nearly 14 per cent, compared to negative price returns for Royal Bank of Canada (RY-T), Canadian Imperial Bank of Commerce (CM-T) and Bank of Nova Scotia (BNS-T). Shares of Bank of Montreal (BMO-T) are relatively flat with a small gain. Shares of TD Bank, while not in overbought territory, as reflected by an RSI reading of 70 or higher, may soon face resistance. Based on the average target price of $90.21, the share price is nearly fully valued.
Turning to the negative breakouts list, half of the securities are in oversold territory, as indicated by RSI readings of 30 or below. A standout on the negative breakouts list is Gildan Activewear (GIL-T), which has entered oversold territory. The share price rallied to a record close of $78.42 on Feb. 26. However, since then the share price has tumbled nearly 18 per cent, closing at $64.47 on March 25. The share price may soon find downside support with the stock trading near its 200-day moving average at $64.41.
The Breakouts file is a technical analysis screen intended to identify companies that are technically breaking out. If a stock appears on the positive breakouts list, this indicates positive price momentum, and that a company may be worthwhile for investors to look at the fundamentals in order to determine if the recent price strength is warranted and will continue. Conversely, if a stock appears on the positive breakouts list, it may reflect a stock that is overbought in the near-term and vulnerable to a pause in the price momentum or a pullback, especially if investors decide to take some profits off the table. If a security appears on the negative breakouts list, it indicates negative price momentum, and may signal deteriorating fundamentals or may reflect a buying opportunity if the stock is undervalued by the market.
Securities screened are from the S&P/TSX Composite Index, the S&P/TSX SmallCap Index, as well as Canadian small cap stocks outside of these indices that have a minimum market capitalization of $200-million.
A technical analysis screen does not replace fundamental analysis but can help identify companies worth having a closer look at.
This report should not be considered an investment recommendation for any of the securities listed.
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