Canadian bank review

Thought its time to review the CDN banks again. Typically, I grab one of the best Canadian Bank ETF’s and analyze the technicals for you guys. But this time, I’m going to go through each of the bank charts separately. There’s only a few of them (8). More importantly, there really are some major differences in their chart patterns. So different that some are outright bullish, while others are outright avoid’s.

First, we’ll start with the big-six. That is, TD, CIBC, Scotia, Royal, Bank of Montreal, and National. Then, we’ll do the two second tier banks Canadian Western and Laurentian. Lets get at it.

The Big Six

TD Bank has been stuck in an ever tightening spiral since early 2022. Craig and I trade this one in our platforms once in a while. Its not a stock to buy and hold. But its risk profile is tight enough to encourage those of us willing to move in and out quickly to take that trade.

Years ago I worked with CIBC/Wood Gundy. Back then, the bank was known as the worst managed on the street. New management, fresh ideas, and the bank has turned the corner. Nice break of the downtrend, soon to test its old highs. Momentum indictors suggest a bit overbought.

We hold BNS in our income platform. We’re considering buying it in our Equity Platform, although have not moved on that trade yet. This bank has historically been the dogs breakfast. But now its breaking out – testing resistance near $70. A breakout would target low $80’s. Its a little overbought.

Remember when you were in high school? There were always two kids that were the best looking kids in the school. The girls ogled over some hunky football team star, probably named Chad. The guys were infatuated over a girl who looked like Barbie. Well, the next two banks are Chad and Barbie. Best looking banks in the big bank side.

Royal is testing resistance – and its momentum is rolling over strongly. Sorry Chad. Everyone still likes the way you look, but perhaps there are more eligible bachelors to look at right now…

You too, BMO-Barbie. You’re hard for a young hormone-driven investor to resist. But MFI and MACD suggest there may be a new girl to catch the boys eyes…

When ValueTrend first became independent, we used National Bank as our Custodian. They were, and are, an innovative bank. Sesame Street used to play the game “One of these things is not like the other”. NA is not like the other big banks. Nice breakout! A bit overbought, may pull back, but adherence to the neckline would shout “bullish”!

The two little guys

These guys, like Rodney Dangerfield used to say, “Don’t get no respect”.

Laurentian is a Quebec based bank with all of the “nuances” of being in that province. If you like roller coasters, this one’s for you! Still–for those of us who like a rhythmical sideways chart, this may entice. Nice trader!

Canadian Western Bank is one we hold in the ValueTrend Equity Platform. Its in a volatile uptrend, and the momentum indicators have pulled back. Its testing the 40 week SMA. We’ve been picking it up on pullbacks – legging in. Like now.

Conclusion

Obviously, we like BNS and CWB because we are in them. We also like trading TD, but that’s a game most people aren’t interested in (note we are NOT in it now). I am contemplating on buying NA if it pulls back near the neckline (its overbought as I write). And of course, that yo-yo pattern on LB is tempting the trader who lives inside me.

Overall – a few stocks that need to break major resistance before I would consider them. A couple of traders. And a new candidate (NA-T) for the new Chad/Barbie of the school.

Updates

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4 Comments

  • “TD has been stuck in an ever tightening spiral since early 2022”
    Does this mean the stock will eventually drop & make a New Low?

    Reply
    • Or break out and make new highs. One or the other…eventually.

      Reply
  • Thank you Keith for this. Is there any reason why you don’t consider EQB? It’s done pretty well (about 100% since this rally started).

    Reply
    • Its more known as a lender – coming from a trust background. While its officially a bank, its not considered a significant player amongst the big boys. I just wanted to cover the majors on this blog. Having said that- right you are re the chart.

      Reply

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