Winston's Investment Ideas 05 (May 19 - Jul 22)

[winston]

TOL @ Mar 6, 2022

Big Picture.jpg

The Big Picture (Update)

As the markets have been quite weak, it's time to review the "big picture" again.

1. Interest Rates:- The US cannot afford to raise interest rates by too much as they have a huge debt to service. Therefore, Powell will try to increase rates as little as possible. The Ukraine War is a good excuse for him this time. His previous excuse of "transitory inflation" was a disaster.

2. Inflation:- Depending on how the Ukraine War unfolds, Consumer Demand and Inflation may drop. Stagflation is a possibility now.

3. USD:- If US interest rates are not rising that quickly then the USD will also not be rising that quickly. However, there's now a flight to safety and the USD is relatively strong without any interest rates increase.

4. Commodities:- There's now a "tug of war" between the perceived "Supply Decrease of Commodities" versus the "High USD". Normally, a higher USD will mean lower Commodity prices. However, Commodity prices are now relatively high because there's a perception that supply could be affected due to the Ukraine War eg. Oil, Natural Gas, Aluminum, Nickel, Wheat, Palladium etc. I will not be chasing commodities at the current prices as the speculators are waiting to lock in some of their handsome profits.

5. Liquidity:- The Margin Calls are coming in and things will probably be uglier before they get better.

6. Global Economy:- Muddling through on Covid19 Rolling Lockdowns and now, the Ukraine War. I think that things will only recover in 1Q, 2023. Stagflation is now a possibility.

7. Market Sentiment:- CNN Fear Greed Index at 22 (Extreme Fear). The "expert" Contrarians thinks that the markets are oversold and there could be a Technical Rebound in the markets. As for myself, I think that there could be another leg down after the technical rebound, so it may not be the time to buy unless you are able to "hit & run" quickly.

8. US Earnings:- For the first quarter of 2022, the year-over-year growth rate is estimated by S&P to be 10.4%. It's not that great but it's not unreasonable either.

9. US Stock Market:- Very volatile. Will avoid unless there's a very strong "Conviction Buy".

10. HK Stock Market:- Very volatile too. Will also avoid unless there's also a strong "Conviction Buy".

11. Trading Tactic:- No Change. The Market Direction is not in favor of being long Equities. Therefore, I should try to avoid any more buying and should also try to lighten my exposure to Equities for the next two months. If not, I should try to hedge, by buying some Inverse ETFs or Leveraged Put Warrants, over the next few weeks.

BTW, it's so funny to see that in just a matter of days, the whole world no longer thinks that they would be dying from Covid19. Instead, they are now focusing on whether they would be dying from a Nuclear War. Time to buy the manufacturers of those Potassium Iodide tablets?


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (34% from 35% last week from 33% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 18% (4 Counters); Boring Market
b. HK: 30% (10 Counters); Bear Market
c. US: 27% (8 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 25% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Techs eg. BABA, Meituan, Tencent, HS Tech (3033), Uber, Grab, SEA, ASM Pacific and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-On (Data from Commodities Live every Saturday)

1. WTI Oil - Higher. US$115.03 from US$91.93 last week from US$91.80 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$105 (2014);
a. When will Iranian Oil be available?
b. Will the US permit Oil to exceed US$85 for an extended period?
c. US and China SPR: < 1 Day of Demand
d. Will Omicron really reduce demand for Oil?
e. Saudi Instability? King Salman is 86 years old
f. U.S. Environmental Regulations And Infrastructure Legislation
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1974 from US$1891 from US$1901;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX, GDXJ
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Higher. US$25.90 from US$24.31 from US$23.95;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
viewtopic.php?f=33&t=10086&start=80

4. Copper - Higher. US$4.92 from US$4.48 from US$4.52;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonnes by 2024
d. Supply: 14 years for operational new mine
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$48.50 from US$43.00 from US$43.25;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.

6. Bitcoin: Risk-On; Lower. US$38872 from US$39330 from US$40018 @ 9.35 AM on March 5, 2022)
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

CNN Fear & Greed Index: "Extreme Fear 22" from "Fear 31" last week from "Fear 37" two weeks ago.

1. US Equities - Lower; 4329 from 4385 from 4349;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 40; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Traded GRAB
f. Bought SEA (SE)

2. HK Equities - Lower. 21908 from 22767 from 24328;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 21600; 19500; 16800
b. Resistance: 31200; 33500
c. Traded Tencent

3. Shanghai Equities - Lower; 3448 from 3451 from 3491;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Lower; 3296 from 3429 from 3429;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 25985 from 26477 from 27122;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Lower; 1592 from 1603 from 1579;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Sold Oriental Holdings
b. Sold Hume Cement


Curencies: Risk-Off (Data from XE.com on Mar 4 @ 1.25 PM)

1. USD to JPY - JPY Weaker; 115.43 from 115.28 last week from 115.19 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0805 from 3.1024 from 3.1147;
a. Would they devalue the SGD because of the slowdown?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7362 from 0.7195 from 0.7204;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.1032 from 1.1174 from 1.1361;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8157 from 7.8076 from 7.8004;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger; 4.1843 from 4.2001 from 4.1861;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3583 from 1.3538 from 1.3439;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.3193 from 6.3153 from 6.3285;
viewtopic.php?f=32&t=7720&start=90

10. Dollar Index - USD Stronger; 97.89 from 97.15 from 95.84;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Fear
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Lower; 1.51% from 1.79% from 1.94%;

Yield on 2 Year US Treasuries - Higher; 1.56% from 1.49% from 1.59%;

Interest Rates:-
1. Argentina to raise interest rates to 42.5%
2. Russian Central Bank Lifts Key Rate to 20%
3. https://finance.yahoo.com/news/argentin ... 16796.html
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 103.55 from 103.65 from 103.24;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 83.08 from 83.14 from 82.77;

Baltic Dry Index - Lower; 2104 from 2187 from 1886; Low 290; High 11,400 (2008)

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiqiud counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind thoughts and comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ Mar 12, 2022

Circus.jpg

From One Circus To Another?

Over the past two years, it has been "strange" watching the "Covid Circus".

"Democratic Free Countries" can just give "Authoritarian Power" to the "Health Czar", to impose whatever he wants eg. Masks, Vaccines, Vaccine Passports, Lockdowns, Quarantines, Travel Restrictions etc without much transparent data, verifiable scientific research, parliamentary debate etc.

And after two years of misinformation, disinformation, manipulation etc, we now have the following statistics on the "Covid Circus":-

1. Till date, about 450m people in the world (out of a global population of 8 billion people) have been infected by Covid. This is about 6% of the world's population. In comparison, the Spanish Flu infected about 30% of the world's population.

2. There are about 6m deaths among the 450m people that are infected. That is a death rate of about 1.3%. In comparison, the death rate for Spanish Flu was about 10%.

3. The 6m Covid deaths over two years, is about 8200 deaths per day. In comparison, before Covid came, about 150,000 people would die everyday in the world anyways.

4. 60% of the world's population is now supposedly vaccinated. That means about 3 billion people in the world are still not vaccinated. How come this 3 billion unvaccinated people are not dying like flies if Covid is so dangerous?

5. If the 6m Covid deaths are all unvaccinated (a big if), that means the death rate among the unvaccinated is still only about 0.2% ( 6/450) or 2 in 1000. Does that justify the "Kiasi Mass Hysteria" that we have seen over the past two years? (The sheeps will always be led because they dont know how to think for themselves).

Enough said on this "Covid Circus" and since it's now leaving town (except for HK and Singapore), I will no longer spend much time on this issue anymore. Suffice to say that if a Cabal does really exist, they are still very much in control of this world.

So let's look at the next Circus that is coming, the "Russian-Ukraine Circus". Every TV channel is now talking about this new circus as if there's no other news in the world.

If they start using Nuclear, Chemical or Biological weapons etc. then this Circus can have 24/7 of the airwaves on all channels. If not, then it should not dominate all news channels 24/7. Who cares how many mistresses Putin has or where his children are living etc.

At the same time, I can understand the various concerns from the Ukraine Invasion including:-
1. High prices of Oil, Natural Gas, Palladium, Nickel, Wheat, Aluminum, Copper, Cobalt etc.
2. The Semiconductor industry being affected by the shortage of Neon
3. Millions of Ukrainian refugees fleeing into Europe
4. Many deaths, injuries etc.
5. Many destroyed buildings, vehicles, properties, infrastructure etc.
6. "Unintended Consequences" from sanctioning Russia
etc.

However, I need to remind myself to be not spending too much time on this new Circus. As long as they dont use Nuclear weapons, the world will continue spinning.

I should also use this opportunity to clean up my Watch-List. In the next few months, I think that there would be a generational buying opportunity, so I should not waste this coming precious buying opportunity.

To help with my timing, I saw a helpful article in Yahoo Finance recently, titled "5 things need to happen before the market turns around":-
1. Improvement in Growth Stocks. (Valuation has decreased).
2. The Fed to change their hawkish stance. (The Ukrainian Invasion is a good excuse).
3. Institutional Buying to Resume. (Some bottom fishing).
4. Sentiment to reach extreme bearishness. (CNN Greed Fear Index at 14 Extreme Fear)
5. A resolution with Russia and Ukraine. (Maybe in a few more weeks).

Finally, for next week, we have the following:-

1. March 15 & 16: US FOMC Meeting; A 25 bps hike in interest rates expected

2. March 16: Celebrated Astrologer, Abhigya Anand, aged 16, is calling for a Market Crash on this day. BTW, he was very accurate on calling the Bitcoin collapse a while back, to the exact day. Please do watch his latest Youtube video below if you are interested:- https://www.youtube.com/watch?v=EJmnwtrAtDg

3. March 16 - 19: Malaysia - UMNO General Assembly; Non-event


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (35% from 34% last week from 35% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 18% (4 Counters); Boring Market
b. HK: 32% (12 Counters); Bear Market
c. US: 24% (7 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 25% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Techs eg. BIDU, BABA, Meituan, Tencent, HS Tech (3033), Uber, Grab, ASM Pacific, DIDI and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Mixed (Data from Commodities Live every Saturday)

1. WTI Oil - Lower. US$109 from US$115 last week from US$92 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. When will Iranian Oil be available?
b. Will the US permit Oil to exceed US$85 for an extended period?
c. US and China SPR: < 1 Day of Demand
d. Will Omicron really reduce demand for Oil?
e. Saudi Instability? King Salman is 86 years old
f. U.S. Environmental Regulations And Infrastructure Legislation
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1992 from US$1974 from US$1891;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Flat. US$26 from US$26 from US$24;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
viewtopic.php?f=33&t=10086&start=80

4. Copper - Lower. US$4.61 from US$4.92 from US$4.48;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$51.00 from US$48.50 from US$43.00;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.

6. Bitcoin: Higher. US$39108 from US$38872 from US$39330 @ 9.10 AM on March 12, 2022)
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

CNN Fear & Greed Index: "Extreme Fear 14" from "Extreme Fear 22" last week from "Fear 31" two weeks ago.

1. US Equities - Lower; 4204 from 4329 from 4385;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Added to GRAB
f. Traded SEA (SE)
g. Traded JD.com
h. Sold GDXJ

2. HK Equities - Lower. 20554 from 21908 from 22767;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19500; 16800
b. Resistance: 31200; 33500
c. Bought Baidu
d. Bought JD
e. Traded CNOOC

3. Shanghai Equities - Lower; 3310 from 3448 from 3451;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Lower; 3250 from 3296 from 3429;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 25163 from 25985 from 26477;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Lower; 1568 from 1592 from 1603;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Traded Hibiscus


Currencies: Risk-Off (Data from XE.com on Mar 12 @ 10.17AM)

1. USD to JPY - JPY Weaker; 117.36 from 115.43 last week from 115.28 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0747 from 3.0805 from 3.1024;
a. Would they devalue the SGD because of the slowdown?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7295 from 0.7362 from 0.7195;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.0901 from 1.1032 from 1.1174;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8295 from 7.8157 from 7.8076;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.1931 from 4.1843 from 4.2001;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3634 from 1.3583 from 1.3538;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.3397 from 6.3193 from 6.3153;
viewtopic.php?f=32&t=7720&start=90

10. Dollar Index - USD Stronger; 99.12 from 97.89 from 97.15;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Extreme Fear
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 1.99% from 1.51% from 1.79%;

Yield on 2 Year US Treasuries - Higher; 1.75% from 1.56% from 1.49%;

Interest Rates:-
1. Argentina to raise interest rates to 42.5%
2. Russian Central Bank Lifts Key Rate to 20%
3. The spread between the 10-year and 2-year Treasury yields is 0.25 from 0.23 last week. When it goes negative (circled in the chart), recession has followed (between 6 and 24 months) all but one time dating back to 1955.
https://finance.yahoo.com/news/argentin ... 16796.html
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 100.75 from 103.55 from 103.65;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 80.93 from 83.08 from 83.14;

Baltic Dry Index - Higher; 2718 from 2104 from 2187; Low 290; High 11,400 (2008)

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind thoughts and comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ Mar 19, 2022

monster.jpg

Fighting The Four-Headed Monster?

In the past week, we have witnessed extreme volatility in the markets ie. individual stocks can fluctuate > 30% in a day, both on the downside and upside.

I have newer seen such volatility in a very long time and it's very difficult to trade under such circumstances.

I have been forcing myself to buy whenever it's crashing and to sell whenever it's rebounding strongly.

This is not the best of strategy though, as you could be catching a falling piano and selling too soon, even if something has risen 30%. (DIDI rose another 50% on the second day after the 30% rise in the previous day).

Anyway, if I want to play in this market, I need to be aware of the "Four-Headed Monster" lurking nearby:-

1. Inflation - Oil, Food, Minerals etc. As long as they dont rise or drop too much suddenly, this risk is still manageable.

2. Rising Rates - I think this one has been telegraphed well. Whether it's four times or eight, it's probably manageable.

3. Covid Lockdowns - I think this one is winding down and will probably be over by 2H next year. Therefore, it should be a manageable risk.

4. Ukraine War - This one is a bit tricky. As long as they dont use Nuclear weapons, it's a manageable risk.


Therefore, if stocks does crash over the next few weeks because of this "Four-Headed Monster", it could be a good buying opportunity.

In the meantime, to help you panic, we also have the "experts" talking of the following:-

1. "Death Cross" ie. every time the 50-day SMA (Simple Moving Average) has fallen through the 200-day SMA, the S&P has seen a substantial pullback. The exception is the 2020 bear market, which happened suddenly.

2. Every 50% rise in crude has led to a recession.

3. Every time, the price for producers rises as high as it has this past week, a recession follows

4. An inverted yield always spells trouble

I dont know which way the markets will go. However, I have been raising Cash over past few weeks in case it wants to go South.

My Cash Level is now 72% from a low of 62% at the beginning of this week.

Finally, I need to remind myself that the reason why one is sitting on Cash is to have the ability to buy whenever there's a crash. So if a crash does come, it's imperative that those Cash be deployed with certainty.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (28% from 35% last week from 34% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 20% (4 Counters); Boring Market
b. HK: 31% (10 Counters); Trading Market
c. US: 19% (6 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 29% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Techs eg. BABA, Meituan, Tencent, HS Tech (3033), Uber, Grab, ASM Pacific and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-On (Data from Commodities Live every Saturday)

1. WTI Oil - Lower. US$105 from US$109 last week from US$115 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. Will Omicron in China, really reduce demand for Oil? China uses about 12m barrels per day.
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produced about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. Sold 1/2 RH Petrogas; Sold Hibiscus
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1922 from US$1992 from US$1974;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX; Sold GDXJ
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Lower. US$25 from US$26 from US$26;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
c. Sold SLV
viewtopic.php?f=33&t=10086&start=80

4. Copper - Higher. US$4.72 from US$4.61 from US$4.92;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Not vested
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$55.00 from US$51.00 from US$48.50;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Higher. US$41820 from US$39108 from US$38872 @ 7.20 AM on March 19, 2022)
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

CNN Fear & Greed Index: "Fear 38" from "Extreme Fear 14" last week from "Extreme Fear 22" two weeks ago.

1. US Equities - Higher; 4463 from 4204 from 4329;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Sold 1/2 GRAB
f. Sold DIDI Global
g. Traded SOXS (Inverse 3x Semiconductors)

2. HK Equities - Higher. 21412 from 20554 from 21908;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19500; 16800
b. Resistance: 31200; 33500
c. Traded Baidu
d. Traded JD
e. Traded Smoore
f, Traded Meituan
g. Traded Tencent
h. Traded 7502 (Inverse 2x Tech ETF)

3. Shanghai Equities - Lower; 3251 from 3310 from 3448;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Lower; 3331 from 3250 from 3296;
Resistance 3850
a. Traded RH Petrogas

5. Japan Equities - Higher; 26827 from 25163 from 25985;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Lower; 1591 from 1568 from 1592;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. No Trade


Currencies: Risk-On (Data from XE.com on Mar 18 @ 4.10PM)

1. USD to JPY - JPY Weaker; 118.92 from 117.36 last week from 115.43 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0986 from 3.0747 from 3.0805;
a. Would they devalue the SGD because of the slowdown?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7377 from 0.7295 from 0.7362;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.1073 from 1.0901 from 1.1032;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Stronger. 7.8193 from 7.8295 from 7.8157;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.2005 from 4.1931 from 4.1843;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3554 from 1.3634 from 1.3583;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.3608 from 6.3397 from 6.3193 ;
viewtopic.php?f=32&t=7720&start=90

10. Dollar Index - USD Weaker; 98.13 from 99.12 from 97.89;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Extreme Fear
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 2.15% from 1.99% from 1.51%;

Yield on 2 Year US Treasuries - Higher; 1.94% from 1.75% from 1.56%;

Interest Rates:-
1. Argentina to raise interest rates to 42.5%
2. Russian Central Bank Lifts Key Rate to 20%
3. The spread between the 10-year and 2-year Treasury yields is 0.21% from 0.25% last week from 0.23% two weeks ago. When it goes negative, recession has followed (between 6 and 24 months) all but one time dating back to 1955.
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 102.70 from 100.75 from 103.55;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 82.53 from 80.93 from 83.08;

Baltic Dry Index - Lower; 2588 from 2718 from 2104; Low 290; High 11,400 (2008)

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind thoughts and comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ Mar 27, 2022

Bulls Bears.jpg

Bulls vs Bears

We have seen a strong "V" rebound over the past week. So where do we go from here?

Bulls like Bill Miller (ex-Legg Mason) thinks that it's still a good buying opportunity:-
1. Shift has begun in market leadership to Value from Growth
2. Energy is a bargain, whose prices do not reflect oil even in the $70s, much less at over $100 now
3. Chinese stocks is a bargain, whose valuations appear too low, particularly when the government is easing and says it wants to help the market
4. Financials is attractive and benefitting from rising rates
5. Travel-related names, such as airlines and cruise ships, should see years of strong demand, due to robust consumer balance sheets and a solid economy
6. Long-term bargains - stocks that have dropped 50% or more from their 52-week highs.

At the same time, we have Carl Icahn who is a bit bearish:-
1. Kept everything hedged for the last few years
2. Wont even try to predict short term movements
3. Dont think that the Feds can engineer a soft landing
4. Thinks that there is going to be a rough landing

If the top names in the business are so divergent in their thinking, on where the markets are heading, what chance do I really have? Am I really that smart to be able to see things clearer than these 'experts"?

In view of the above, I have used the current "V" rebound to further lighten my exposure to Equities. My exposure is now down to 23% from about 40% two weeks ago.

However, I will probably be deploying the Cash over the next few weeks. And I need to remind myself to be more patient and to wait for the catalyst and set-up first, before buying. In addition, I should also try to aim for the 25th percentile of the trading range and or RSI <30.

Finally, the four-headed monster (Inflation, Rising Interest Rates, Covid19 and Ukraine) is still lurking around. Therefore, I need to constantly monitor this monster, in case it gets agitated and suddenly spew a large ball of fire at me and burn a large hole in my retirement portfolio.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (23% from 28% last week from 35% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)

a. Singapore: 17% (3 Counters); Boring Market
b. HK: 29% (9 Counters); Trading Market
c. US: 23% (6 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 31% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Techs eg. BABA, Meituan, HS Tech (3033), Uber, Grab, ASM Pacific and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-On (Data from Commodities Live every Saturday)

1. WTI Oil - Lower. US$113 from US$105 last week from US$109 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. Will Omicron in China, really reduce demand for Oil? China uses about 12m barrels per day.
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produced about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. Vested in RH Petrogas
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1958 from US$1922 from US$1992;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Higher. US$26 from US$25 from US$26;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
c. Sold SLV
viewtopic.php?f=33&t=10086&start=80

4. Copper - Flat. US$4.69 from US$4.72 from US$4.61;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Not vested
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$57.50 from US$55.00 from US$51.00;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Higher. US$44222 from US$41820 from US$39108 @ 2.25PM on March 25, 2022)
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-On (Data as of Saturday every week)

CNN Fear & Greed Index: "Neutral 46" from "Fear 38" last week from "Extreme Fear 14" two weeks ago.

1. US Equities - Higher; 4543 from 4463 from 4204;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. No Trade

2. HK Equities - Flat. 21405 from 21412 from 20554;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19500; 16800
b. Resistance: 31200; 33500
c. Sold 1/2 Alibaba
d. Sold Tencent

3. Shanghai Equities - Lower; 3212 from 3251 from 3310;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Higher; 3414 from 3331 from 3250;
Resistance 3850
a. Sold 1/2 Wilmar
b. Sold Riverstone

5. Japan Equities - Higher; 28150 from 26827 from 25163;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Higher; 1603 from 1591 from 1568;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Sold 1/2 IGB


Currencies: Mixed (Data from XE.com on Mar 25 @ 2.10PM)

1. USD to JPY - JPY Weaker; 121.76 from 118.92 last week from 117.36 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.1107 from 3.0986 from 3.0747;
a. Would they devalue the SGD because of the slowdown?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7531 from 0.7377 from 0.7295;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.1028 from 1.1073 from 1.0901;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8244 from 7.8193 from 7.8295;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.2182 from 4.2005 from 4.1931;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3561 from 1.3554 from 1.3634;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.3624 from 6.3608 from 6.3397;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 98.52 from 98.13 from 99.12;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Extreme Fear
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 2.36% from 2.15% from 1.99%;

Yield on 2 Year US Treasuries - Higher; 2.15% from 1.94% from 1.75%;

Interest Rates:-
1. Argentina to raise interest rates to 42.5%
2. Russian Central Bank Lifts Key Rate to 20%
3. The spread between the 10-year and 2-year Treasury yields is 0.21% from 0.21% last week from 0.25% two weeks ago. When it goes negative, recession has followed (between 6 and 24 months) all but one time dating back to 1955.
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 101.93 from 102.70 from 100.75;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 81.91 from 82.53 from 80.93;

Baltic Dry Index - Lower; 2567 from 2588 from 2718; Low 290; High 11,400 (2008)


Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind thoughts and comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ Apr 3, 2022

April.png

New Money From The New Month

It's a new month again and new money would be flowing into the markets again.
Therefore, we should have a spike in the markets next week unless the Fund
Managers have already spent their money in advance this week.

Thereafter, the markets could be directionless until the US Earnings Season.

In the meantime, Barron's has a fairly negative article on the markets:-
1. Inflation is accelerating
2. Profit growth is slowing and
3. Bond yields are rising

However, BoFA said that $13.2 billion was moved into Cash last week and cash positions by Fund Managers earlier this month reached their highest levels since
the pandemic market crash of March 2020. Therefore, those cash on the side-lines could be buying on any steep dips.

Anyway, many "experts" are now saying that Value is better than Growth in this
type of markets. Coincidentally, "Wealthy Retirement" recently had a useful article
on identifying a Value stock:-

1. Market leader: Ask yourself whether the company in question is selling a
particular type of product at a higher volume than its competitors.

2. Several Streams Of Income: Does this company have other ways of generating revenue beyond its initial product offering? What other products/services does it offer?

3. Big Backlogs (if manufacturing): Does it have a lot of future orders that have
not been filled? The forecast of future service/parts ordered will be an accurate forecast for orders in the year ahead.

4. Strong Cash-Generating Capability: Does the company consistently produce
cash flows from its ongoing operations?

5. Established Operations: Does the company have sound systems in place so it
runs like a well-oiled machine?

6. Large institutional ownership: The company should have a substantial amount
of stock owned by large entities that manage funds on the behalf of others.

As to Geographical Allocations, Goldman Sach sees the S&P 500 ending the year at 4,700, up just 2% from its recent level. It expects a gain of 6% in European stocks
and 14% in Asian stocks over the next year.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (25% from 23% last week from 28% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 15% (3 Counters); Boring Market
b. HK: 25% (8 Counters); Trading Market
c. US: 30% (6 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 30% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies eg. HKD, MYR and SGD
c. Heavy exposure to Techs eg. BABA, HS Tech (3033), Uber, Grab, ASM Pacific and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-On (Data from Commodities Live every Saturday)

1. WTI Oil - Lower. US$99 from US$113 last week from US$105 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. Will Omicron in China, really reduce demand for Oil? China uses about 12m bpd
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produced about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: 1m bpd for 6 months
e. Vested in RH Petrogas
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1924 from US$1958 from US$1922;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Lower. $25 from US$26 from US$25;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
viewtopic.php?f=33&t=10086&start=80

4. Copper - Flat. US$4.71 from US$4.69 from US$4.72;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Not vested
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$58 from US$57 from US$55;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Higher. US$46754 from US$44222 from US$41820 @ 9.53 AM on April 2, 2022
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Russia-Ukraine War
f. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-On (Data as of Saturday every week)

CNN Fear & Greed Index: "Neutral 49" from "Neutral 46" last week from "Fear 38" two weeks ago.

1. US Equities - Flat; 4546 from 4543 from 4463;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Added to Grab

2. HK Equities - Higher. 22040 from 21405 from 21412;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19500; 16800
b. Resistance: 31200; 33500
c. Sold Meituan

3. Shanghai Equities - Higher; 3283 from 3212 from 3251;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Higher; 3419 from 3414 from 3331;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 27666 from 28150 from 26827;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Flat; 1602 from 1603 from 1591;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. No trade


Currencies: Mixed (Data from XE.com on Apr 3 @ 9.00 AM)

1. USD to JPY - JPY Weaker; 122.51 from 121.76 last week from 118.92 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.1021 from 3.1107 from 3.0986;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7488 from 0.7531 from 0.7377;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.1051 from 1.1028 from 1.1073;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8338 from 7.8244 from 7.8193;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger; 4.2090 from 4.2182 from 4.2005;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3568 from 1.3561 from 1.3554;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.3631 from 6.3624 from 6.3608;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 98.63 from 98.52 from 98.13;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Extreme Fear
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 2.36% from 2.15% from 1.99%;

Yield on 2 Year US Treasuries - Higher; 2.46% from 2.39% from 2.15%;

Interest Rates:-
1. Argentina to raise interest rates to 42.5%
2. Russian Central Bank Lifts Key Rate to 20%
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 102.15 from 101.93 from 102.70;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 81.95 from 81.91 from 82.53;

Baltic Dry Index - Lower; 2357 from 2567 from 2588; Low 290; High 11,400 (2008)

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind thoughts and comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ Apr 10, 2022

Earnings.jpg

US Q1 Earnings Season

It's going to be US Earnings Season soon and the following are some info from Fact Sets:-

1. Estimated earnings growth for the S&P is at 4.7%. (By the way, if that is the actual growth rate, it will be the lowest rate since Q4 of 2020.)

2. At the sector level, six sectors witnessed a decrease in their bottom-up EPS estimate for CY 2022 from December 31 to March 31, led by the Communication Services (-3.0%) and Industrials (-3.0%).

2. Five sectors witnessed an increase in their bottom-up EPS estimates for CY 2022 during this time, led by the Energy sector (+35.9%).

3. Analysts are most optimistic on the Energy (66%), Information Technology (64%), and Communication Services (62%) sectors.

4. Analysts are most pessimistic on the Consumer Staples (41%) and Utilities (49%).

Anyway, I have been keeping my powder dry and waiting for a catalyst before buying (maybe US Earnings Season could be that catalyst).

However, before I get too confident, I need to first remind myself of the following from the Stock Almanac:-

1. Liquidity normally dries up from May till November.

2. Next month also begins the half-year ahead of the midterm elections, the weakest six months for stocks in the Presidential Cycle.

3. And the worst of these have come during the first term of Democratic Presidents.

In addition, BofA Securities, observed recently that the dollar amount of first-quarter S&P 500 company buyback announcements as a percentage of market capitalization were 50% below their five-year pre-Covid average—0.4% versus 0.8%.

Barron's also mentioned recently that the "Animal Spirits" are waning. The Animal Spirits Index (ASI) slid deeper into negative territory in March, falling to -0.24 from -0.22 in February. On a basic level, an ASI value above zero indicates optimism, while a value below zero suggests pessimism.

In conclusion, my trading strategy over the next few weeks, would still be to remain cautious, taking into account the following:-
a. Historically, the next 6 months could be a weak period for the market
b. US Buybacks are now declining
c. US Market Sentiment are also weak as measured by the "Animal Spirit" index
d. The four-headed monster (Rising Interest Rates, Inflation, Covid-19 and Ukraine) is still lurking around

There are now many negative news nowadays and any of them can derail the markets easily. However, Cash levels are also very high and they could be buying on any steep dips. So if things can go from "bad" to "less bad" (as defined by Daily Wealth), maybe the markets can also stabilize and stage a meaningful rebound.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (29% from 25% last week from 23% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 13% (3 Counters); Boring Market
b. HK: 24% ( Counters); Trading Market
c. US: 38% (7 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 25% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies eg. HKD, MYR and SGD
c. Heavy exposure to Techs eg. BABA, HS Tech (3033), Uber, Grab, DIDI, ASM Pacific and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-Off (Data from Commodities Live every Saturday)

1. WTI Oil - Lower. US$98 from US$99 last week from US$113 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. Will Omicron in China, really reduce demand for Oil? China uses about 12m bpd
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produced about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: 1m bpd for 6 months
e. Vested in RH Petrogas
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1948 from US$1924 from US$1958;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Flat. $25 from $25 from US$26;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
viewtopic.php?f=33&t=10086&start=80

4. Copper - Flat. US$4.73 from US$4.71 from US$4.69;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Not vested
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$60 from US$58 from US$57;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Lower. US$42443 from US$46754 from US$44222 @ 9.06 AM on April 9, 2022
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Russia-Ukraine War
f. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

CNN Fear & Greed Index: "Neutral 48" from "Neutral 49" last week from "Neutral 46" two weeks ago.

1. US Equities - Lower; 4488 from 4546 from 4543;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Bought SMH (Semiconductor ETF)
f. Bought DIDI Global
g. Traded Grab

2. HK Equities - Lower. 21872 from 22040 from 21405;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19500; 16800
b. Resistance: 31200; 33500
c. Bought Tencent

3. Shanghai Equities - Lower; 3252 from 3283 from 3212;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Lower; 3383 from 3419 from 3414;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 26986 from 27666 from 28150;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Higher; 1607 from 1602 from 1603;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Sold Malayan Cement


Currencies: Risk-Off (Data from XE.com on Apr 9 @ 9.40 AM)

1. USD to JPY - JPY Weaker; 124.29 from 122.51 last week from 121.76 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0954 from 3.1021 from 3.1107;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7448 from 0.7488 from 0.7531;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.0874 from 1.1051 from 1.1028;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8392 from 7.8338 from 7.8244;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.2186 from 4.2090 from 4.2182;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3635 from 1.3568 from 1.3561;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.3593 from 6.3650 from 6.3631;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 99.80 from 98.63 from 98.52;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Neutral
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 2.70% from 2.36% from 2.15%;

Yield on 2 Year US Treasuries - Higher; 2.52% from 2.46% from 2.39%;

Interest Rates:-
1. Argentina to raise interest rates to 42.5%
2. Russian Central Bank Lifts Key Rate to 20%
3. Zimbabwe has world’s highest interest rate at 80%
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 99.98% from 102.15 from 101.93;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 80.24 from 81.95 from 81.91;

Baltic Dry Index - Lower; 2055 from 2357 from 2567; Low 290; High 11,400 (2008)

Inflation:-
a. Peru - curfew; violent inflation protests
b. Sri Lanka - protests; power cuts, food shortages, line ups for gasoline
c. Kenya - fuel shortage as government delays subsidy; long line ups;
d. Turkey - 61% rise in inflation at 20 year high
e. Zimbabwe, Venezuela, Argentina and Lebanon: situation worsening
viewtopic.php?f=16&t=6950&start=110

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind thoughts and comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ Apr 16, 2022

Bears.jpg

Where Are The Bulls?

The markets have been weak for the past week and the Bears are getting louder:-

1. Jamie Dimon:-
The ongoing war in Ukraine, high inflation and the Feds' hawkish stance on monetary policy, could combine to significantly increase the chances of a recession.

2. Jeffery Gundlach:-
The S&P 500 has been “massively juiced” by QE and low rates.

3. Larry Summers:-
‘The odds on a hard landing within the next 2 years are certainly better than half, and quite possibly two-thirds or more’.

While the Bears are getting louder, I have not seen any Bullish comment on the markets this week.

In view of the above, I'm wondering whether the markets are oversold and can only go up, when things go from "bad" to "less bad". Cash levels are also elevated as everyone is so bearish.

And if you look at what the 3 "experts" above are saying, there's really nothing new.

Who does not know that interest rates are rising, inflation is high, there's a war in Ukraine, China is under lock-down, Commodities prices are high etc.?

Anyway, there's nothing much over the next two weeks except for the US 1Q Earnings Season. My trading strategy remains "Cautiously Bullish".

I will continue to buy "undervalued" stocks on steep dips but will also take quick profits. If it does not rebound, I will just sit on it for the "medium term".

I still think that things will go from "bad" to "less bad" from 2H. I also think that the long list of known risks can be mitigated.

And while I'm getting a bit confident, I need to also remind myself that the "Great Vampire Squid", Goldman Sachs, has been selling billions in stocks for the 3rd quarter in a row.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (31% from 29% last week from 25% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 12% (3 Counters); Boring Market
b. HK: 25% (10 Counters); Trading Market
c. US: 40% (7 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 23% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies eg. HKD, MYR and SGD
c. Heavy exposure to Techs eg. Tencent, BABA, Baidu, HS Tech (3033), Uber, Grab, DIDI, ASM Pacific, SMH (Semiconductor ETF) and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Mixed (Data from Commodities Live every Saturday)

1. WTI Oil - Higher. US$107 from US$98 last week from US$99 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. What's the Demand reduction in China? China uses about 12m bpd
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produce about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: 1m bpd for 6 months
e. Vested in RH Petrogas
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1973 from US$1948 from US$1924;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Higher. $26 from $25 from $25;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
c. Vested in SLV
viewtopic.php?f=33&t=10086&start=80

4. Copper - Flat. US$4.72 from US$4.73 from US$4.71;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Not vested
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$64 from US$60 from US$58;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Lower. US$40638 from US$42443 last week from US$46754 two weeks ago @ 9.50 AM on April 16, 2022
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Russia-Ukraine War
f. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

CNN Fear & Greed Index: "Fear 42" from "Neutral 48" last week from "Neutral 49" two weeks ago.

1. US Equities - Lower; 4393 from 4488 from 4546;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Bought SLV (Silver ETF)

2. HK Equities - Lower. 21518 from 21872 from 22040;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19500; 16800
b. Resistance: 31200; 33500
c. Bought Baidu
d. Traded Gangfeng Lithium

3. Shanghai Equities - Lower; 3211 from 3252 from 3283;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Lower; 3336 from 3383 from 3419;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 27093 from 26986 from 27666;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Lower; 1589 from 1607 from 1602;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. No Trade


Currencies: Risk-Off (Data from XE.com on Apr 16 @ 9.55 AM)

1. USD to JPY - JPY Weaker; 126.44 from 124.29 last week from 122.51 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.1207 from 3.0954 from 3.1021;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7395 from 0.7448 from 0.7488;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.0812 from 1.0874 from 1.1051;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8443 from 7.8392 from 7.8338;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.2355 from 4.2186 from 4.2090;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3572 from 1.3635 from 1.3568;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.3713 from 6.3593 from 6.3650;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 100.50 from 99.80 from 98.63;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Neutral
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 2.83% from 2.70% from 2.36%;

Yield on 2 Year US Treasuries - Lower; 2.46% from 2.52% from 2.46%;

Interest Rates:-
1. Russian Central Bank Lifts Key Rate to 20%
2. Zimbabwe has world’s highest interest rate at 80%
3. Argentina raises key rate to 47% as inflation hits 20-year high
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Flat: 99.92% from 99.98% from 102.15;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Flat; 80.23 from 80.24 from 81.95;

Baltic Dry Index - Higher; 2137 from 2055 from 2357; Low 290; High 11,400 (2008)

Inflation:-
a. Peru - curfew; violent inflation protests
b. Sri Lanka - protests; power cuts, food shortages, line ups for gasoline
c. Kenya - fuel shortage as government delays subsidy; long line ups;
d. Turkey - 61% rise in inflation at 20 year high
e. Zimbabwe, Venezuela, Argentina and Lebanon: situation worsening
viewtopic.php?f=16&t=6950&start=110

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ Apr 24, 2022

Big Picture.jpeg

The Big Picture (Update)

The markets were weak recently due to:-
1. The speech by Xi at the Boao forum
2. The speech by Jay Powell at the IMF panel
3. Both the World Bank and IMF cutting their outlooks for global growth
4. Goldman Sachs mentioning that there’s a 35% chance that the U.S. economy will go into recession within two years

In view of the fragile sentiment in the markets, it's time to review the "Big Picture" again.

1. Interest Rates:- The US cannot afford to raise interest rates by too much as they have a huge debt to service. Therefore, Powell will try to increase interest rates as little as possible. At the same time, he has to manage "inflation expectations". Hence, he has been sounding very hawkish while one of his boys even talked about a 75 bps rise. Suddenly, a 50 bps rise is now acceptable by the markets.

2. Inflation:- Depending on how the Ukraine War unfolds, Consumer Demand may drop. Stagflation is a real possibility now.

3. USD:- The USD has been quite strong due to the expected 50 bps rise. It would be interesting to see whether the USD can continue it's rise after the 50 bps rise.

4. Commodities:- There was a broad drop in Commodities. Some "experts" were saying that it's due to China buying less Commodities due to their lockdown. Others says that it's due to the high USD. As for myself, I think that it's just plain old fashion "profit-taking". Hence, I may buy some Commodities companies if the price is right.

5. Liquidity:- The Margin Calls are coming in and things will probably be uglier before they get better. At the same time, there's a lot of Cash on the sidelines, waiting to buy any deep plunge.

6. Global Economy:- Muddling through on Covid19, Inflation, Rising Rates and the Ukraine War.

7. Market Sentiment:- Extremely weak. The Wells Fargo "Animal Spirits Index" and the AAII survey is very weak. Both are good "Contrarian Indicators".

8. US Earnings:- For Q1 2022 (with 20% of S&P 500 companies reporting actual results), 79% of S&P 500 companies have reported a positive EPS surprise and 69% of S&P 500 companies have reported a positive revenue surprise. People are now focusing on forward guidance to see how bad things will be later in the year.

9. US Stock Market:- Starting to get attractive with the plunge. Will buy whenever the opportunity presents itself.

10. HK Stock Market:- Very volatile too. Have started to replenish my inventory this week.

11. Trading Tactic:- I'm starting to buy whenever there's a plunge. I could be a bit early as the "Market Direction" is not in favor. However, I have been sitting on quite a bit of Cash and it's time to slowly deploy some of them.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (38% from 31% last week from 29% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 10% (3 Counters); Boring Market
b. HK: 38% (15 Counters); Trading Market
c. US: 31% (9 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 20% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies eg. HKD, MYR and SGD
c. Heavy exposure to Techs eg. Tencent, BABA, Baidu, JD, Meituan, HS Tech (3033), Uber, Grab, DIDI, ASM Pacific, SMH (Semiconductor ETF) and FB
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-Off (Data from Commodities Live every Saturday)

1. WTI Oil - Lower. US$102 from US$107 last week from US$98 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. What's the Demand reduction in China? China uses about 12m bpd
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produce about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: 1m bpd for 6 months
e. Vested in RH Petrogas
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1933 from US$1973 from US$1948;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Lower. $24 from $26 from $25;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
c. Vested in SLV
viewtopic.php?f=33&t=10086&start=80

4. Copper - Lower. US$4.58 from US$4.72 from US$4.73;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Not vested
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Lower; US$62 from US$64 from US$60;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Lower. US$39593 from US$40638 last week from US$42443 two weeks ago @ 4.25 PM on April 23, 2022
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Russia-Ukraine War
f. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

1. US Equities - Lower; 4272 from 4393 last week from 4488 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Traded Netflix

2. HK Equities - Lower. 20639 from 21518 from 21872;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19500; 16800
b. Resistance: 31200; 33500
c. Bought JD
d. Bought Meituan
e. Bought Zijin
f. Bought China Merchants Bank
g. Bought CICC
h. Added to 3033 (Hang Seng Tech ETF)

3. Shanghai Equities - Lower; 3087 from 3211 from 3252;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Higher; 3361 from 3336 from 3383;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 27105 from 27093 from 26986;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Higher; 1602 from 1589 from 1607;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. No Trade


Currencies: Risk-Off (Data from XE.com on Apr 23 @ 4.35 PM)

1. USD to JPY - JPY Weaker; 128 from 126 last week from 124 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.15 from 3.12 from 3.10;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.72 from 0.74 from 0.74;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Flat. 1.08 from 1.08 from 1.09;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8467 from 7.8443 from 7.8392;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.33 from 4.24 from 4.22;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.37 from 1.36 from 1.36;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.50 from 6.37 from 6.36;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 101.22 from 100.50 from 99.80;
viewtopic.php?f=32&t=7616&start=60



Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Extreme Fear
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 2.91% from 2.83% from 2.70%;

Yield on 2 Year US Treasuries - Higher; 2.68% from 2.46% from 2.52%;

Interest Rates:-
1. Russian Central Bank Lifts Key Rate to 20%
2. Zimbabwe has world’s highest interest rate at 80%
3. Argentina raises key rate to 47% as inflation hits 20-year high
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 98.79 from 99.92 from 99.98;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 79.26 from 80.23 from 80.24;

Baltic Dry Index - Higher; 2307 from 2137 from 2055; Low 290; High 11,400 (2008)

Inflation:-
a. Peru - curfew; violent inflation protests
b. Sri Lanka - protests; power cuts, food shortages, line ups for gasoline
c. Kenya - fuel shortage as government delays subsidy; long line ups;
d. Turkey - 61% rise in inflation at 20 year high
e. Zimbabwe, Venezuela, Argentina and Lebanon: situation worsening
viewtopic.php?f=16&t=6950&start=110

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ May 1, 2022

bsh.jpg

Is It Time To Buy?

The markets have been very volatile and I'm starting to SLOWLY deploy my Cash.

There are various "contrarian indicators" that indicates that the markets may have been oversold and is due for a bounce:-

1. The five-day average Put / Call ratio stood at 0.94. CNN Business interprets it as “Extreme Fear.” A normal reading is around 0.7.

2. The Relative Strength Index of the S&P had just sunk to nearly oversold conditions at 32.

3. Only 16.4% of the AAII (American Association of Individual Investors) members felt bullish about where the market will be in six months. A whopping 59.4% were bearish, with the remainder neutral. This was the most bearish that investors have been in the last 12 months. It’s also double the average level of bearishness, which comes in at 30.5%.

4. Margin Debts is down nearly 15% to $800b from the high of $936b that Wall Street had borrowed as of Oct. 21, 2021.

And from US Earnings Season so far, 50% of the S&P 500 have now reported for Q1, with 80% beating estimates. Even with rising costs, profit margins are still strong, at 12.2% (the fifth highest since 2008).

Anyway, if you are the "Buy and Hold" type, then I would not suggest that you play in this type of "Trading Market". This market is only for nimble traders only, who have no problem getting in quickly and then getting out fast, with small profits.

I will only "Buy and Hold" in a market that wants to continue to go in one direction only, as in the case after March 2020 to about November 2021.

For next week, we have the FOMC Meeting. I think that it will be a 50 bps increase. If it's at 75 bps, the market will probably tank and then rebound. If it's at 25 bps, it could go up a bit and then fade.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (35% from 38% last week from 31% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 11% (3 Counters); Boring Market
b. HK: 38% (12 Counters); Trading Market
c. US: 30% (9 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 21% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies eg. HKD, MYR and SGD
c. Heavy exposure to Techs eg. Tencent, BABA, HS Tech (3033), Uber, Grab, DIDI, ASM Pacific, SMH (Semiconductor ETF) and AMZN
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-Off (Data from Commodities Live every Saturday)

1. WTI Oil - Higher. US$104 from US$102 from US$107 last week from US$98 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. What's the Demand reduction in China? 10%? 1.2m bpd / 12m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produce about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: 1m bpd for 6 months
e. Vested in RH Petrogas
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1897 from US$1933 from US$1973;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX; Zijin (50% Gold)
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Lower. $23 from $24 from $26;
a. Attractive "Silver to Gold" ratio 80
b. Industrial Demand
c. Vested in SLV
viewtopic.php?f=33&t=10086&start=80

4. Copper - Lower. US$4.39 from US$4.58 from US$4.72;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Vested in Zijin (50% Copper)
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Lower; US$53 from US$62 from US$64;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Lower. US$38689 from US$39593 last week from US$40638 two weeks ago @ 2.55 PM on April 30, 2022
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Russia-Ukraine War
f. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

CNN Fear & Greed Index: "Fear 27" from "Fear 40" last week from "Fear 42" two weeks ago.

1. US Equities - Lower; 4132 from 4272 last week from 4393 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 19
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. Bought AMZN
f. Traded FB
g. Traded DIDI Global

2. HK Equities - Lower. 21089 from 20639 from 21518;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19900; 19500; 16800
b. Resistance: 31200; 33500
c. Added to China Merchants Bank
d. Sold JD
e. Sold Meituan
f. Sold Baidu
g. Sold 1/3 3033 (Hang Seng Tech ETF)

3. Shanghai Equities - Lower; 3047 from 3087 from 3211;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Lower; 3357 from 3361 from 3336;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 26848 from 27105 from 27093;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Lower; 1600 from 1602 from 1589;
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. No Trade


Currencies: Risk-Off (Data from XE.com on Apr 30 @ 3.00 PM)

1. USD to JPY - JPY Weaker; 130 from 128 last week from 126 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Flat; 3.15 from 3.15 from 3.12;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.71 from 0.72 from 0.74;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.05 from 1.08 from 1.08;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Flat. 7.8466 from 7.8467 from 7.8443;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.36 from 4.33 from 4.24;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.38 from 1.37 from 1.36;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.61 from 6.50 from 6.37;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 102.96 from 101.22 from 100.50;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Neutral
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 2.94% from 2.91% from 2.83%;

Yield on 2 Year US Treasuries - Higher; 2.73% from 2.68% from 2.46%;

Interest Rates:-
1. Russian Central Bank Lifts Key Rate to 20%
2. Zimbabwe has world’s highest interest rate at 80%
3. Argentina raises key rate to 47% as inflation hits 20-year high
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 97.61 from 98.79 from 99.92;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 78.53 from 79.26 from 80.23;

Baltic Dry Index - Higher; 2404 from 2307 from 2137; Low 290; High 11,400 (2008)

Inflation:-
a. Peru - curfew; violent inflation protests
b. Sri Lanka - protests; power cuts, food shortages, line ups for gasoline
c. Kenya - fuel shortage as government delays subsidy; long line ups;
d. Turkey - 61% rise in inflation at 20 year high
e. Zimbabwe, Venezuela, Argentina and Lebanon: situation worsening
viewtopic.php?f=16&t=6950&start=110

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics

[winston]

TOL @ May 8, 2022

Slow Motion Crisis.jpg

Slow-Motion Crisis?

There are more and more bearish news and some "experts" are now calling it a "slow-motion crisis":-

1. Strategas: Expecting a slide for the S&P 500 towards the 3,500-3,700 area, a range that encompasses the gauge’s 200-week moving average and the midpoint of its entire rally from the 2020 pandemic bottom. A drop to 3,500 would represent a 15% loss from yesterday's close.

2. Morgan Stanley: Risk of S&P 500 falling to 3,460 should "estimated profit growth" start to turn negative, amid recession concerns.

3. MKM Partners: Fund Managers have started to re-price stocks using recession-like multiples. If that is the case, we are still over-valued.

4. DataTrek Research: If the market discounts a 50% chance of a recession, the S&P would only be considered “cheap” were it to fall another 20% from current levels.

5. Fact-Set Forward Guidance: Increasing number of companies are discussing macroeconomic headwinds for the next few quarters. Highest percentages of companies citing “inflation” and “supply chain” on earnings calls, going back to at least 2010.

6. Sentiment Trader: Carnage in the Nasdaq:
a. More than 45% of stocks down 50%
b. More than 22% of stocks down 75%
c. More than 5% of stocks down 90%.

7. In the month through April 27, equity-focused funds saw US$30 billion of outflows.

At the same time, Investor Place is saying that this could be buying opportunity in "divergence stocks" as outlined below:-
a. Investors start to panic about a recession.
b. Stocks begin to drop on those recession fears.
c. Most stocks keep dropping because as the economy slows, they will suffer from declining revenues and earnings
d, However, certain high-quality growth stocks don't suffer from declining revenues and earnings.
e. Instead, those fundamentals keep growing at a rapid rate because their growth drivers are so powerful that they're "recession-proof."
f. The result is a massive divergence between the price of those stocks and the relative revenues and earnings.
g. This divergence always corrects itself. And that sends those high-quality growth stocks significantly higher within a short time -- even if the market keeps crashing.

The above is a very good reminder for me, to start looking out for some "divergence stocks" and not to allow the bearishness in the markets, to freeze me like a "deer watching the headlights of a car".


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (38% from 35% last week from 38% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)

a. Singapore: 10% (3 Counters); Boring Market
b. HK: 40% (13 Counters); Trading Market
c. US: 30% (9 Counters); Large Caps & ETFs @ Time Difference
d. Malaysia: 20% (9 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" - Around 26%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

4. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies eg. HKD, MYR and SGD
c. Heavy exposure to Ride-Hailing Companies: DIDI, Uber, Grab
d. Heavy exposure to Tech: Tencent, BABA, HS Tech (3033), ASM Pacific, SMH (Semiconductor ETF) and AMZN
Goal: To diversify across various Sectors, Countries and Currencies


Commodities: Risk-Off (Data from Commodities Live every Saturday)

1. WTI Oil - Higher. US$111 from US$104 last week from US$102 two weeks ago;
Support: US$73; US$62, US$29; Resistance: US$126;
a. What's the Demand reduction in China? 10%? 1.2m bpd / 12m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil be available? Iran can produce about 4m bpd.
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: 1m bpd for 6 months
e. Vested in RH Petrogas
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1883 from US$1897 from US$1933;
Support: 1785; 1700; 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX; Zijin (50% Gold)
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Lower. US$22 from US $23 from US$24;
a. Attractive "Silver to Gold" ratio
b. Industrial Demand eg. Solar
c. Vested in SLV
viewtopic.php?f=33&t=10086&start=80

4. Copper - Lower. US$4.25 from US$4.39 from US$4.58;
Support: 4.00; 3.08 (S2); 3.52 (S3); 2.25 (S5); Resistance: 4.75;
a. Is the rebound in the Global Economy for real?
b. Demand: +40% over next 10 years
c. Deficit: -0.5m tonne by 2024
d. Supply: 14 years for operational new mine
e. Vested in Zijin (50% Copper)
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$55 from US$53 from US$62;
Support: 14 (2016); Resistance: 50; 73 (2011); 140 (2007);
a. Sprott Physical Uranium Trust ( SRUUF) to purchase up to $1 billion in additional uranium in the next few months.
b. Pandemic: decrease in production and related services.
c. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
d. Not vested

6. Bitcoin: Lower. US$36029 from US$38689 last week from US$39593 two weeks ago @ 9.08 AM on May 7, 2022
a. Record: $69,000 Nov 2021; Support: $29,800
b. BITO - US Listed Bitcoin ETF
c. Cost of Mining Bitcoin: US$5000 to US$8500
d. US$1m Target by Cathie Woods by 2030
e. Russia-Ukraine War
f. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as of Saturday every week)

CNN Fear & Greed Index: "Fear 31" from "Fear 27" last week from "Fear 40" two weeks ago.

1. US Equities - Lower; 4123 from 4132 last week from 4272 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3600; 3270; 2237 (Mar 2020); 1930 (2016); Resistance: 4750
b. S&P 500: Forward PE 18
c. S&P 500 CAPE Ratio; Current = 38; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 215% (highest); >140 is Expensive
e. No Trade

2. HK Equities - Lower. 20002 from 21089 from 20639;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 19900; 19500; 16800
b. Resistance: 31200; 33500
c. Bought Baidu
d. Added to 3033 (Hang Seng Tech ETF)

3. Shanghai Equities - Lower; 3002 from 3047 from 3087;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)

4. Spore Equities - Lower; 3292 from 3357 from 3361;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 27004 from 26848 from 27105;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. No Trade

6. Malaysian Equities: Lower; 1564 from 1600 from 1602:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. No Trade


Currencies: Risk-Off (Data from XE.com on May 7 @ 9.15 AM)

1. USD to JPY - JPY Weaker; 131 from 130 last week from 128 two weeks ago;
a. 52 week range is 76 to 131
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Flat; 3.15 from 3.15 from 3.15;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Flat; 0.71 from 0.71 from 0.72;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.06 from 1.05 from 1.08;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.8499 from 7.8466 from 7.8467;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.37 from 4.36 from 4.33;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.39 from 1.38 from 1.37;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.67 from 6.61 from 6.50;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 103.66 from 102.96 from 101.22;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
a. Cap of 40% for loans to Developers by banks; Low Cost Rental projects excluded;
b. Cap of 32.5% for mortgage loans by banks
c. Developers' M&A loans not limited by the "three red lines" policy
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. Stronger than expected
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=20


Others

Market Sentiment - Fear
viewtopic.php?f=16&t=9099&start=90

Headwinds:-
viewtopic.php?f=16&t=8930&p=231225#p231225

Tailwinds:-
viewtopic.php?f=16&t=8940&p=231226#p231226

Warning Signs:-
viewtopic.php?f=16&t=9909&p=231227#p231227

Risk Management:-
viewtopic.php?f=16&t=7547&p=231228#p231228

Yield on 10 Year US Treasuries - Higher; 3.14% from 2.94% from 2.91%;

Yield on 2 Year US Treasuries - Flat; 2.73% from 2.73% from 2.68%;

Interest Rates:-
1. Russian Central Bank Lifts Key Rate to 20%
2. Zimbabwe has world’s highest interest rate at 80%
3. Argentina raises key rate to 47% as inflation hits 20-year high
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 96.37 from 97.61 from 98.79;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 77.59 from 78.53 from 79.26;

Baltic Dry Index - Higher; 2718 from 2404 from 2307; Low 290; High 11,400 (2008)

Inflation:-
a. Peru - curfew; violent inflation protests
b. Sri Lanka - protests; power cuts, food shortages, line ups for gasoline
c. Kenya - fuel shortage as government delays subsidy; long line ups;
d. Turkey - 70% rise in inflation at 20 year high
e. Zimbabwe, Venezuela, Argentina and Lebanon: situation worsening
viewtopic.php?f=16&t=6950&start=110

Covid19 Notes:-
viewtopic.php?f=25&t=5657&start=150

US Slowdown - How Deep & How Long?
viewtopic.php?f=11&t=9039&start=50

Risks Out There:-
posting.php?mode=reply&f=16&t=8930


Please Note:-

The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. For illiquid counters, I may not disclose my trading activity for the week.

Please do use the above at your own risk and please do feel free to provide me with your kind comments

Active Topics - There is an "Active Topics" button on the top right corner.
search.php?search_id=active_topics