Toronto Dominion Bank still an accumulate

Jun 17th, 2015 – Comment

The MACD appears to be turning up which could set the stage for a run back to resistance along the 50-day moving average.


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Good day Lou,

Good article in G&M! I am looking to enter TD and POT – any thoughts?

Sincerely,

Dimitrios

 

Hey Dimitrios,

Thanks for the assignment. I am glad that you are getting value from my efforts. I will cover Toronto Dominion Bank (TD TSX) today and Potash Corporation of Saskatchewan Inc.  (POT TSX) on Friday. This will be the fourth time since 2012 that I inspect the charts for TD. The last was on March 16, 2015 on a request from Tbone. The shares were trading for $53.57 and the dividend yield was 3.81 %. Tbone was thinking of taking a position in the stock and wanted a report on the technical patterns.

The analysis conducted on his behalf indicated that the uptrend line that started in late 2011 when the shares were trading just above $30.00 had been broken as the shares retreated from a high near $57.00 in December of 2014. The pullback had TD test support at $50.00 where it caught a bounce that saw the stock building support along the 50-day moving average near $53.00.

Even though there were no strong indications that TD was about to start a new leg up it was advised to accumulate the shares. In the ensuing months the stocks performance has supported the thesis.

Another inspection of the charts will help identify how you might proceed with this investment.

 

TD

The three-year chart outlines a stock that has been range bound with resistance near $57.00 going back to August of 2014. Support near $52.50 has been evident since June of 2014. Once again there are no clear patterns pointing to a break out from the range.

 

 

 

 

 

 

TD2

Since the beginning of June the six-month chart depicts a stock testing support long the 200-day moving average near $54.00. The MACD appears to be turning up which could set the stage for a run back to resistance along the 50-day moving average. If TD gets over $55.50 it could extend the move to resistance near $56.50.

Given the evidence at hand I still believe that TD should be accumulated over a long term investment horizon. Buy a bit now and regularly. Its not a screaming buy at this juncture but it should be in your portfolio so you can enjoy the 3.76% dividend yield.

I will examine POT on Friday.

Make it a profitable day and happy capitalism!

 

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