TOL as of March 21, 2010:-
Climbing a Wall of Worries
As we bump along nicely ( maybe due to Window Dressing activities ), I'm being reminded of the old saying above.
Anyway, a strong catalyst for a steep correction has not really materialized. Dubai was strong but not strong enough. Greece is also strong but again maybe not strong enough unless it becomes a contagion and also spreads to say Spain.
Could the "third top" be in the form of a higher USD ? Or an unexpected rate hike in the US or China? Or a collapse of Commodities due to an unwinding of speculative positions, possibly from a higher USD or new legislation ?
The week in review:-
1) Oil - US$80.60 from US$81.24 last week. The strong USD has affected the price of Oil. The cold weather is also almost over. And when would the Iraqi Oil be coming online ?
2) Gold - US$1107 from US$1102 last week. The strong USD has also affected Gold. And there's still no news on who would be buying those IMF gold ..
3) Other Commodities - Waiting for the 50% retracement.
4) Shanghai Equities - 3068 from 3014 last week. Strong Support @ 2750. Two strong headwinds ie. higher interest rates & reduced liquidity. Expecting the market to be trend-less..
5) HK Equities - 21371 from 21210 last week. Strong Support at 19500. Low volume. Position in AMVIG and added to Fosun. Bought & Sold Shineway Pharma. It's now earnings season so I need to make hay while the sun is shining
6) HK IPO - Applied for Huiyi. Did not apply for Flyke and Zhongsheng
7) Spore Equities - 2916 from 2881 last week. Support at 2625. Bought and Sold Capital Malls Asia this week ( my third trade on this counter ). Sold Starhill and also sold some Hotung.
8) US Equities - 1160 from 1150. Support at 1035. Stronger than expected but on low volume. Still sitting on my S&P Inverse ETF. Let's hoped that this "Position Trade" will not turn into a "Long Term Buy & Hold"
9) Japan Equities - 10825 from 10751 last week. Support @ 9850. Yen is going up on the repatriation of overseas profit before the end of March. Will it affect the market ?
10) Emerging Markets - Stronger than expected again.
11) Properties ( HK, China & Singapore) - Some Chinese SOEs have been told to exit the Property eg. Sino Ocean
12) Iran - When will sanctions starts ?
13) US & Japanese Interest Rates - When will the sudden spike happen ? India started raising interest rates last week. Who's next ?
14) USD - 80.76 from 79.84 last week. Unexpected strength. Maybe we will get the 50% retracement of 82 after all.
15) European Contagion - How big can it become ?
16) Mutual Fund - Cash levels are very low at < 3%. If there's a prolonged correction, there will not be anymore fire-power to support prices. And any redemption will also force prices lower...
17) Risks Out There - Please see the "Risks Out There" thread
18) Window Dressing- Was the unexpected strength in the past two weeks due to window dressing activities ?
I'll probably start worrying about the Market Direction after the Window Dressing activities. In the meantime, I'll continue to enjoy the party. I'm now positioning myself close to the doors. When the fire starts, everyone will be running to the door at the same time. Only the nimble will be able to get out ..
Some smart individuals may have already positioned themselves for the fire. They could also be the ones who will light the fire. Thereafter, they will spread it through Newsletters, Analyst Reports, Blogs, CNBC, Bloomberg, Magazines, Newspapers, Forums etc..
The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk. Please do also feel free to provide me with your kind thoughts and comments.
Please Note:-
Support the forum button - We would appreciate your kind support to defray the expenses of maintaining the forum. The Sin$600 Hosting Fees is due soon and our advertizement revenue till date is less than Sin$15.
Second Opinion - Please see the "Second Opinion" thread in the "Useful Reference" section, located just below the Miscellaneous Section.
Private Messages ( PM ) - Please do check your Inbox for any PMs. The Inbox is located on the top left hand corner of the Index Page.
Active Topics: Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index Page.