I’m seeing a possible support line at $81.34. This was a recent swing low, attained on July 20.
In a recent conversation, a friend of mine whom I’ll refer to as RK, pitched the idea of creating a portfolio consisting entirely of TD (TSX) stocks. RK is favourable to pretty much all Canadian banks, though he believes TD will take off when they start deploying the cash they received from selling off TD Ameritrade.
I agree with RK in that I generally think that Canadian banks are a safe investment and that in the long run they will appreciate in value. I’m also picky compared to RK about timing the entry and exit of my trading positions.
I’m also picky about the trading strategies I use. In the past I’ve tried out various strategies, often jumping from one strategy to the next shiny new strategy of the week. For my long term capital growth portfolio I’ve finally settled on picking stocks from a set list of searches. Every so often I’ll run each of these Capital Growth searches and throw the results into a watchlist. So why were the Canadian banks not showing up in these scans?
It turns out I wasn’t looking closely enough. When I started looking at the filters more closely I found that the Canadian banks were actually passing through the scans. Including TD. They were getting buried in the watchlist with all the other scan results; that’s why I didn’t notice them at first glance. I may be picky about how I choose the stocks I trade, and TD fit my criteria.
I’m also picky about timing my entry into a new position. I generally like to open a new position when the market is trending favourably and the stock of interest is rising in value. I think the current market in Canada is in a weak tend yet still bullish. Hence I view market timing as favourable. TD short term direction not so favourable.
TD market price had been falling for several days and was showing a recent pattern of lower highs. On the one hand, this could be an opportunity to buy TD cheap before its anticipated rally. On the other hand, I’d like to be sure it’s not establishing a new pattern of lower lows.
I’d like to see that TD bounces off this line or reverses its downward course before falling that low, to be sure it isn’t establishing a new pattern of lower lows. I was seeing a possible support line at $81.34. This was a recent swing low, attained on July 20.