Winston's Investment Ideas 05 (May 19 - Dec 24)

by **winston** » Sun Sep 08, 2019 3:10 pm

TOL @ Sep 8, 2019

time.jpg

It's Not The Time To Be Too Negative

The HK market rocketed 1000 points on Wednesday, on rumors that Carrie Lam would be withdrawing the extradition bill.

Although withdrawing that bill was not that big a deal, as there were 4 other demands from the protesters, the shorts panicked and were busily covering their positions.

This episode tells me that there's still a lot of money on the sidelines, just waiting to buy. Therefore, it does not pay to be too negative at this point in time.

One can be cautious in this type of market but when the trading opportunity presents itself, one should also not be too afraid to take it.

This is similar to the case last week when the US markets rocketed on two supposedly non-existent phone calls from China to the US, begging the US to go back to the negotiating table.

On the horizon, we have the FOMC Meetings on Sept 17-18.. Everyone is expecting a 25 bps rate cut. And if we do get a 50 bps cut, people would be wondering whether the US economy is indeed in a bad shape.

We would also be seeing the 3Q Window Dressing activities at work if they have not already begun.

In view of the above, I think that the markets should be quite "safe" for the next three weeks until early October, unless it becomes too "euphoric".

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Safe (Net 13% of Liquid Assets from 15%)
Goal: 5% exposure to Equities before the next recession (2020-2021?); Maximum 20%;

2. To Diversify From Asian Equities: Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - Bought 7500 (HK 2x Inverse)
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Progress (15 from 17 counters)
Goal: To focus on about 5 to 8 counters only, that have convincing stories

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 8 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 7 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 8 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 7 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia

Total: 53 out of 70 (76%); (Safe: 50%; Danger: 85%)

Commodities: Risk-On (Data from Commodities Live on Sep 6 @ 6.00PM)

1. WTI Oil - Higher. US$56.24 from US$55.16 last week from US$55.42 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined); Heavy Oil;
e. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd;
k. Venezeula: -400k bpd to 875k bpd, -17%; Max Production: 2.2m bpd
l. Iran: 2.6m bpd; -400k bpd
m. US Summer Driving season winding down
n. OPEC: Heavier Crude; More Processing; +200k bpd
o. US: Lighter Crude and Lower Sulphur; Glut Gasoline; +1m bpd; 2018 Production +17% yoy;
p. EV: -350k bpd?
q. Libya: 950k out of 1.65m bpd potential
r. US Break-Even; Permian: US$35 to US$50; Shale: US$50
s. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
t. Russia: Oil Contamination; -500k bpd
u. US: Stockpiles: Reducing?
v. Shale Debt: 9b maturing in 2019; $137b to mature between 2020-2022
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lowerr. US$1515 from US$1529 from US$1505;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Higher; US$2.63 from US$2.56 from US$2.56;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

Equities - Mixed (Data as of Saturday every week)

1. US Equities - Higher. 2926 from 2847 last week from 2889 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b. Traded Alphabet (GOOG)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 26691 from 25725 from 26179;
a. Support: 25000, 24500, 23500;
b. Resistance: 31200, 31600;
c. Sold Tencent 0700
d. Sold China Mengniu 2319
e. Bought 7500 (Inverse Hang Seng 2x)
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 3000 from 2886 from 2897;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3148 from 3107 from 3110;
a. Resistance 3850
b. Traded JMH
c. Traded JSH
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 21200 from 20704 from 20711;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1604 from 1612 from 1609;
a. Sold Supermax
b. Added to MNRB
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-On (Data from XE.com on Sep 6 @ 4.45 PM)

1. USD to JPY - JPY Weaker; 107.03 from 106.29 last week from 1.0663 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0217 from 3.0208 from 3.0146;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.6832 from 0.6731 from 0.6755;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger. 0.9447 from 0.9348 from 0.9371;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger; 2.8543 from 2.8311 from 2.8305;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1040 from 1.1056 from 1.1102;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8394 from 7.8487 from 7.8422;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1783 from 4.2052 from 4.1904;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
c. Just converted some USD to MYR
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3827 from 1.3885 from 1.3872;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 7.1205 from 7.1541 from 7.0814;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2294 from 1.2157 from 1.2214;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.1376 from 5.1125 from 5.1178;

13. Dollar Index - USD Weaker; 98.40 from 98.92 from 98.42;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market Funds (US$4t)
viewtopic.php?f=16&t=8940&start=30

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Higher; 1.59% from 1.50% last week from 1.64% two weeks ago

Yield on 2 Year Treasuries - Higher; 1.56% from 1.50% from 1.63%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: One 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 24%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 108.64 from 108.81 from 108.57;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 87.06 from 87.16 from 86.95;

Baltic Dry Index - Higher; 2499 from 2277 from 2118; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

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viewtopic.php?f=14&t=2823&start=40

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by **winston** » Sun Sep 15, 2019 8:12 am

TOL @ Sep 15, 2019

Window D.jpg

3Q Window Dressing?

The markets have been strong over the past few weeks and I'm expecting the momentum to last till the beginning of October.

So were the buying due to 3Q Window Dressing?

Intuitively, I think that some of the buying were due to 3Q Window Dressing activities as well as the following:-
1. ECB reduced rates further to -0.5% and launched a EUR 20b QE program per month, starting Nov 1, 2019
2. A 25 bps rates cut is expected by the US Feds on Sep 18. Not expecting any QE yet.
3. Fund Managers and Shorts were trying to catch up with the market because they were overweighted in Cash or were shorting the markets, going into this rally
4. Positive sentiment on the trade war front. No stupid tweets over the past few weeks. But you never know what's on the mind of a "bone-head". (He who calls others a "bone-head", can be called a "bone-head" as well.
5. National Team supporting the China market before their 70th Anniversary
6. New Money From The New Month of October

In view of the above, I'm expecting the markets to be "quite safe" over the next few weeks. And if there's any Trading Opportunity, I should take it.

Anyway, I did buy a few counters this week, especially the Jardine counters in Singapore. I think that the selling on them is a bit over-done and if they do drop further then I will be averaging down my position. (Averaging down is not a recommended trading strategy but in this case, I'm not trading but am buying a deeply discounted asset).

BTW, HK Land owns 12 Commercial Building in Central HK. Only 10% of their leases are expiring in 2019 and only another 20% are expiring in 2020. Do you really see this protests extending beyond the 70th Anniversary in Ocober?

It would not surprise me if there is some drastic action to maintain stability and peace after the 70th Anniversary unless there's outright mayhem before the 70th Anniversary.

At the same time, I need to remind myself not to be too confident. This is because whenever I'm over-confident, I tend to get into trouble.

I also need to remind myself to do some selling at the beginning of October or if things get too euphoric" over the next two weeks.

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (Net 17% of Liquid Assets from 13% last week)
Goal: 5% exposure to Equities before the next recession (2020-2021?); Maximum 25%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - Holding 7500 (HK 2x Inverse)
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Worse (20 from 15 counters)
Goal: To focus on about 5 to 8 counters only, that have convincing stories

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 8 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 7 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 8 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 7 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia

Total: 53 out of 70 (76%); (Safe: 50%; Danger: 85%)

Commodities: Mixed (Data from Commodities Live on Sep 13 @ 7.45 PM)

1. WTI Oil - Lower. US$55.20 from US$56.24 last week from US$55.16 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. US Summer Driving season winding down
n. EV: -350k bpd?
0. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1513 from US$1515 from US$1529;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Higher; US$2.67 from US$2.63 from US$2.56;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Higher. 3007 from 2926 last week from 2847 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b. Bought Wendy's (WEN)
c. Sold Johnson & Johnson (JNJ)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 27353 from 26691 from 25725;
a. Support: 25000, 24500, 23500;
b. Resistance: 31200, 31600;
c. No Trade
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 3031 from 3000 from 2886;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3211 from 3148 from 3107;
a. Resistance 3850
b. Bought JMH
c. Bought JSH
d. Bought HK Land
e. Bought Mandarin Oriental
f. Bought Isetan
g. Sold Venture
h. Sold SIA Engineering
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 21200 from 20704 from 20711;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1604 from 1612 from 1609;
a. Bought Axiata
b. Bought Tune Protect
c. Traded Digi
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-On (Data from XE.com on Sep 13 @ 8.00 PM)

1. USD to JPY - JPY Weaker; 107.99 from 107.03 last week from 106.29 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0378 from 3.0217 from 3.0208;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.6877 from 0.6832 from 0.6731;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9436 from 0.9447 from 0.9348;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger; 2,8656 from 2.8543 from 2.8311;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1103 from 1.1040 from 1.1056;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8258 from 7.8394 from 7.8487;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
e. Converted some HKD to MYR
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1685 from 4.1783 from 4.2052;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3722 from 1.3827 from 1.3885;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 7.0787 from 7.1205 from 7.1541;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2453 from 1.2294 from 1.2157;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.1889 from 5.1376 from 5.1125;

13. Dollar Index - USD Weaker; 98.02 from 98.40 from 98.92;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market Funds (US$4t)
n. ECB: Interest rates at -0.5%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Higher; 1.79% from 1.59% last week from 1.50% two weeks ago

Yield on 2 Year Treasuries - Higher; 1.73% from 1.56% from 1.50%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 17%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 108.94 from 108.64 from 108.81;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 87.32 from 87.06 from 87.16;

Baltic Dry Index - Lower; 2331 from 2499 from 2277; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Sep 22, 2019 3:01 pm

TOL @ Sep 22, 2019

somethings-not-right.jpg

Something Is Not Right?

The markets were weaker than expected this week.

There was no follow through, to the buying two weeks ago.

I'm not too sure what is the cause of the weakness:-
1. Oil Spike
2. Lack Of Liquidity in the repo markets
3. Expected 25 bps rates cut
4. China cancelling their trip to the Mid-West
or something else.

So where do we go from here?

I'm still expecting the markets to be "safe" next week, for the following reasons:-
1. Window Dressing activities
2. China's "National Team" supporting the Chinese market, before their 70th Anniversary. That "positivity" should flow into HK as well.
3. No stupid tweets on the Trade War

However, if we do not see much "Window Dressing" activities next week, then it may be time to start thinking about lightening up on Equities again.

This is because we have to also worry about the following:-
1. Retaliation to the bombing in Saudi Arabia
2. Radicals in HK planning something "big" during China's 70th year anniversary
3. China walking away from any "interim" trade deal altogether because they have lost so much face. And if China walks away, what would be their retaliation?

If the situation presents itself next week, I may do some selling and raise some Cash.

At the same time, my exposure to Equities are quite light at 17% of Liquid Assets, so I should be able to coast through any weakness in the markets over the next few weeks.

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (Net 17% of Liquid Assets from 17% last week)
Goal: 5% exposure to Equities before the next recession (2020-2021?); Maximum 25%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - Sold 7500 (HK 2x Inverse)
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Progress (19 from 20 counters last week)
Goal: To focus on about 5 to 8 counters only, that have convincing stories

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
c. Heavy exposure to HK
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 8 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 53 out of 70 (76%); (Safe: 50%; Danger: 85%)

Commodities: Mixed (Data from Commodities Live on Sep 20 @ 9.00 PM)

1. WTI Oil - Higher. US$59.12 from US$55.20 last week from US$56.24 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. US Summer Driving season winding down
n. EV: -350k bpd?
0. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1509 from US$1513 from US$1515;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Lower; US$2.62 from US$2.67 from US$2.63;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Lower. 2992 from 3007 last week from 2926 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b. Sold Wendy's (WEN)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Lower. 26436 from 27353 from 26691;
a. Support: 25000, 24500, 23500; 22000;
b. Resistance: 29000; 31200, 31600;
c. Bought Henderson Land 0012
d. Bought Foxconn International 2038
d. Sold 7500 (Inverse 2x Hang Seng)
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 3006 from 3031 from 3000;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Lower; 3160 from 3211 from 3148;
a. Resistance 3850
b. Traded Mandarin Oriental
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22079 from 21200 from 20704;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1597 from 1604 from 1612;
a. Sold Axiata
b. Traded UEM-Sunrise
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-Off (Data from XE.com on Sep 20 @ 9.15 PM)

1. USD to JPY - JPY Stronger; 107.94 from 107.99 last week from 107.03 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0319 from 3.0378 from 3.0217;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.6782 from 0.6877 from 0.6832;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9334 from 0.9436 from 0.9447;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Weaker; 2.8299 from 2,8656 from 2.8543;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1021 from 1.1103 from 1.1040;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8346 from 7.8258 from 7.8394;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
e. Converted some HKD to MYR
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.1721 from 4.1685 from 4.1783;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Weaker; 1.3763 from 1.3722 from 1.3827;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 7.0917 from 7.0787 from 7.1205;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2482 from 1.2453 from 1.2294;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.2080 from 5.1889 from 5.1376;

13. Dollar Index - USD Stronger; 98.52 from 98.02 from 98.40;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market Funds (US$4t)
n. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Lower; 1.77% from 1.79% last week from 1.59% two weeks ago

Yield on 2 Year Treasuries - Higher; 1.74% from 1.73% from 1.56%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 17%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 109.02 from 108.94 from 108.64;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 87.37 from 87.32 from 87.06;

Baltic Dry Index - Lower; 2192 from 2331 from 2499; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Sep 29, 2019 3:19 pm

TOL @ Sep 29, 2019

October.jpg

New Money From the New Month

It's going to be a new month again so the markets could spike up some time next week.

In addition, there could also be some Window Dressing activities on both Monday and Tuesday.

Thereafter, the Trade Talks will be around October 10.

And after that, it's US Earnings Season again.

In view of the above, the markets should be quite "safe" for the next two weeks unless we have an unexpected event including:-
1. China walking out on the Trade Talks; Probability 35%
2. US banning Chinese companies from being listed in the US; Probability 45%
3. US imposing sanctions on some China SOEs; Probability 45%
4. Retaliation or Follow-Up Attack to the Saudi Aramco bombing; Probability 45%

At the same time, I need to remind myself that October is traditionally a "dangerous" month and there's a need to be a bit more careful especially when we also have the following:-
1. A slowing global economy
2. A tweeting "desperate and erratic" President, who is is facing impeachment
3. A worsening Geopolitical situation in the Middle-East
4. Various Trade Wars across the globe

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (22% of Liquid Assets from 17% last week)
Goal: 5% exposure to Equities before the next recession (2020-2021?); Maximum 30%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - No Progress
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Worse (24 from 19 counters last week)
Goal: To focus on about 5 to 8 counters only, that have convincing stories

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
c. Heavy exposure to HK
d. Heavy exposure to Commercial Property counters
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 8 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 53 out of 70 (76%); (Safe: 50%; Danger: 85%)

Commodities: Risk-Off (Data from Commodities Live on Sep 28 @ 2.30 PM)

1. WTI Oil - Lower. US$56.17 from US$59.12 last week from US$55.20 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. US Summer Driving season winding down
n. EV: -350k bpd?
0. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1503 from US$1509 from US$1513;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Lower; US$2.60 from US$2.62 from US$2.67;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Lower. 2962 from 2992 last week from 3007 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b, No Trade
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Lower. 25955 from 26436 from 27353;
a. Support: 25000, 24500, 23500; 22000;
b. Resistance: 29000; 31200, 31600;
c. Bought Cofco Meat 1610
d. Bought Tencent 0700
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 2932 from 3006 from 3031;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Lower; 3126 from 3160 from 3211;
a. Resistance 3850
b. Bought Venture
c. Bought Hotel Properties Limited
d. Traded Mandarin Oriental
e. Bought JMH
f. Bought JSH
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Lower. 21879 from 22079 from 21200;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1584 from 1597 from 1604;
a. Bought IGBB
b. Added to MAA
c. Sold some MNRB
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-Off (Data from XE.com on Sep 28 @ 2.40 PM)

1. USD to JPY - JPY Flat; 107.92 from 107.94 last week from 107.99 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Flat; 3.0315 from 3.0319 from 3.0378;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.6763 from 0.6782 from 0.6877;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger. 0.9345 from 0.9334 from 0.9436;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger; 2.8329 from 2.8299 from 2,8656;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.0940 from 1.1021 from 1.1103;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8403 from 7.8346 from 7.8258;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.1883 from 4.1721 from 4.1685;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Weaker; 1.3816 from 1.3763 from 1.3722;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 7.1228 from 7.0917 from 7.0787;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.2289 from 1.2482 from 1.2453;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Weaker; 5.1472 from 5.2080 from 5.1889;

13. Dollar Index - USD Stronger; 99.10 from 98.52 from 98.02;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market (US$3.4t); US$3.9 @ Sub-Prime Crisis; Lowes US$2.6t;
n. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Lower; 1.68% from 1.77% last week from 1.79% two weeks ago

Yield on 2 Year Treasuries - Lower; 1.63% from 1.74% from 1.73%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 17%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 108.68 from 109.02 from 108.94;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 87.07 from 87.37 from 87.32;

Baltic Dry Index - Lower; 1857 from 2192 from 2331; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Oct 06, 2019 9:35 am

TOL @ Oct 6, 2019

Water Torture.jpg

Water Torture?

The markets have been dripping down bit by bit, over the past few weeks.

It's like those water torture where they put your fore-head under some dripping water. And after a short while, that drop of water on your fore-head, would feel like a stone.

Anyway, I could feel the fear around me over the past two weeks. Therefore, I have been forcing myself to buy, as one must always trade against one's emotion.

I now have a good position to play any technical rebound in the markets.

In addition, the Central Banksters will probably continue to reduce interest rates and print money, to counter the global slowdown.

In HK, as the 70th Anniversary is now over, the government has more room now to control the situation. I dont think that the situation will deteriorate much further from here. The question now is how high is the rebound and how soon.

As I'm now a bit confident of a technical market rebound, it's timely to remind myself of the following quote: "Whoever that the gods want to destroy, they first make him confident".

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (25% from 22% of Liquid Assets last week)
Goal: 5% exposure to Equities before the next recession (2020-2021?); Maximum 30%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - No Progress
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Worse (29 from 24 counters last week)
Goal: To focus on about 8 to 12 counters only, that have convincing stories

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
c. Heavy exposure to HK
d. Heavy exposure to Commercial Property counters
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 8 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 53 out of 70 (76%); (Safe: 50%; Danger: 85%)

Commodities: Risk-Off (Data from Commodities Live on Oct 4 @ 8.40 PM)

1. WTI Oil - Lower. US$52.98 from US$56.17 last week from US$59.12 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. US Summer Driving season winding down
n. EV: -350k bpd?
0. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1510 from US$1503 from US$1509;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Lower; US$2.54 from US$2.60 from US$2.62;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Lower. 2962 from 2992 last week from 3007 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b, Bought Alibaba (BABA)
c. Sold Ulta Beauty (ULTA)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Lower. 25821 from 25955 from 26436;
a. Support: 25000, 24500, 23500; 22000;
b. Resistance: 29000; 31200, 31600;
c. Bought AVIC (0161)
d. Bought SHK Properties (0012)
e. Sold Tencent 0700
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 2905 from 2932 from 3006;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Lower; 3078 from 3126 from 3160;
a. Resistance 3850
b. Traded Venture
c. Bought Great Eastern
d. Bought Yangzijiang
e. Bought Yanlord Land
f. Added to JSH
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Lower. 21410 from 21879 from 22079;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1558 from 1584 from 1597;
a. No trade
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-Off (Data from XE.com on Oct 4 @ 8.55 PM)

1. USD to JPY - JPY Stronger; 106.94 from 107.92 last week from 107.94 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0332 from 3.0315 from 3.0319;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.6754 from 0.6763 from 0.6782;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9321 from 0.9345 from 0.9334;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Weaker; 2.8273 from 2.8329 from 2.8299;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.0964 from 1.0940 from 1.1021;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8430 from 7.8403 from 7.8346;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1862 from 4.1883 from 4.1721;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3799 from 1.3816 from 1.3763;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 7.1488 from 7.1228 from 7.0917;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2302 from 1.2289 from 1.2482;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.1499 from 5.1472 from 5.2080;

13. Dollar Index - USD Weaker; 98.94 from 99.10 from 98.52;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market (US$3.4t); US$3.9 @ Sub-Prime Crisis; Lowes US$2.6t;
n. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Lower; 1.55% from 1.68% last week from 1.77% two weeks ago

Yield on 2 Year Treasuries - Lower; 1.42% from 1.63% from 1.74%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 17%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 107.34 from 108.68 from 109.02;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 86.16 from 87.07 from 87.37;

Baltic Dry Index - Lower; 1757 from 1857 from 2192; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Oct 13, 2019 2:56 pm

TOL @ Oct 13, 2019

hold.jpg

Time To Hold A Bit Longer?

The market has been strong for the past week and I'm starting to think that it's time to hold on to my positions a bit longer than to take small profits.

In the past, I would not hesitate to take small profits as I believed that it was a "Trading Market".

However, I'm starting to feel that it may be time to hold on a bit longer for the following reasons:-

1. The US-China Trade War has supposedly completed "Phase 1" (whatever that means). Didn't Trump said that Trade Wars are easy to win? So why are they only at "Phase 1" after so many months?

2. US Earnings is just around the corner and expections are extremely low

3. The Central Banksters of the world are lowering interest rates and starting to print money again eventhough some of them do not want to call it QE this time.

The only time that I would sell now, would be if things become euphoric or if there's a huge spike on any given day.

In the meantime, I'm reviewing my notes on Selling eg. PEG, Trailing Stop-Loss, Resistance, RSI etc.

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Safe (35% of Liquid Assets)
Goal: 5% exposure to Equities before the next recession (2020-2021?); Maximum 35%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - No Progress
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Worse (33 from 29 counters last week)
Goal: To focus on about 8 to 12 counters only

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
c. Heavy exposure to HK
d. Heavy exposure to Commercial Property counters
e. Heavy exposure to Insurance industry
f. Heavy exposure to Malaysian Infrastructure projects
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 8 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 7 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 7 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 51 out of 70 (73%); (Safe: 60%; Danger: 85%)

Commodities: Risk-On (Data from Commodities Live on Oct 4 @ 8.40 PM)

1. WTI Oil - Higher. US$54.88 from US$52.98 last week from US$56.17 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -300 bpd; Nigeria -300k bpd; Iraq -200k bpd; Kurdistan -400k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd; Ecuador -1m bod; Net: -3.8m bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. EV: -350k bpd?
n. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1493 from US$1510 from US$1503;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Higher; US$2.62 from US$2.54 from US$2.60;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Higher. 2970 from 2962 last week from 2992 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b, No Trade
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 26308 from 25821 from 25955;
a. Support: 25000, 24500, 23500; 22000;
b. Resistance: 29000; 31200, 31600;
c. Bought AIA (1299)
d. Bought MMG (1208)
e. Sold Cofco Meat (1610)
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 2974 from 2905 from 2932;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3114 from 3078 from 3126;
a. Resistance 3850
b. Sold some HPL
c. Sold Mandarin Oriental
e. Sold Yanlord Land
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 21799 from 21410 from 21879;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1557 from 1558 from 1584;
a. Bought Ann Joo
b. Bought Gabungan AQRS
c. Bought Gamuda
d. Bought Hume Industry
e. Added to Genting Berhad
f. Added to MAA
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-On (Data from XE.com on Oct 12 @ 11.15 AM)

1. USD to JPY - JPY Weaker; 108.38 from 106.94 last week from 107.92 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0332 from 3.0315 from 3.0319;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.6790 from 0.6754 from 0.6763;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Flat. 0.9321 from 0.9321 from 0.9345;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger; 2.8422 from 2.8273 from 2.8329;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1041 from 1.0964 from 1.0940;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8434 from 7.8430 from 7.8403;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1860 from 4.1862 from 4.1883;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3728 from 1.3799 from 1.3816;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 7.0882 from 7.1488 from 7.1228;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2649 from 1.2302 from 1.2289;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.2950 from 5.1499 from 5.1472;

13. Dollar Index - USD Weaker; 98.30 from 98.94 from 99.10;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market (US$3.4t); US$3.9 @ Sub-Prime Crisis; Lowes US$2.6t;
n. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers
7. Insiders Selling: US$26b till date; Highest US$37b in 2000

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Higher; 1.73% from 1.55% last week from 1.68% two weeks ago

Yield on 2 Year Treasuries - Higher; 1.59% from 1.42% from 1.63%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 17%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 108.08 from 107.34 from 108.68;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.77 from 86.16 from 87.07;

Baltic Dry Index - Higher; 1924 from 1757 from 1857; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Oct 20, 2019 8:54 am

TOL @ Oct 20, 2019

Sell When There Are Buyers

The markets have not gone anywhere over past week and I'm starting to wonder whether it's still a "Trading Market" instead of a "Buy & Hold Market".

One could now see the buyers disappearing and the sellers outnumbering the buyers on many counters.

I have had a few counters where I decided to wait one more day to sell and on the next day, there were no longer any buyers.

Therefore, maybe it's still a "Trading Market" and I may need to sell whenever there are buyers.

Anyway, I have been selling some counters over the past few days. This is because there was a formula error in my spreadsheet and my equities exposure was much more than what I thought it was. I only realized this mistake when the Cash levels in my brokerage accounts were very low.

I have since brought my exposure to Equities down to 28% of my Liquid Assets from 37% last week.

I'm still not expecting a plunge in the markets because there's no euphoria yet. In addition, the Central Banksters can still support the markets whenever the economy is weak.

However, the "Water Torture" that we have to endure is a bit uncomfortable and maybe it's best to be a bit cautious.

On the horizon, we have Brexit and the FOMC Meeting on Oct 30-31. I'm expecting both events to be non-eventful.

In the meantime, we also have the circus in the White House, from Syria to Iran to the Impeachment to the Trade Wars and one cant help being numb and fed up with the "noise".

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (28% from 37% of Liquid Assets last week)
Goal: 10% exposure to Equities before the next recession (2020-2021?); Maximum 35%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - No Progress
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Progress (25 from 33 last week)
Goal: To focus on about 8 to 12 counters only

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
c. Heavy exposure to HK
d. Heavy exposure to Commercial Property counters
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 8 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 7 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 7 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 51 out of 70 (73%); (Safe: 60%; Danger: 85%)

Commodities: Risk-On (Data from Commodities Live on Oct 19 @ 9.50 AM)

1. WTI Oil - Lower. US$53.72 from US$54.88 last week from US$52.98 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -300 bpd; Nigeria -300k bpd; Iraq -200k bpd; Kurdistan -400k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd; Ecuador -1m bod; Net: -3.8m bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. EV: -350k bpd?
n. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Flat. US$1493 from US$1493 from US$1510;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Higher; US$2.64 from US$2.62 from US$2.54;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Higher. 2986 from 2970 last week from 2962 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b, Sold Alibaba (BABA)
c. Sold Alphabet (GOOG)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 26720 from 26308 from 25821;
a. Support: 25000, 24500, 23500; 22000;
b. Resistance: 29000; 31200, 31600;
c. Sold AIA
d. Sold Foxconn International
e. Sold Henderson land
f. Sold Sun Hung Kai Properties
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 2938 from 2974 from 2905;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Flat; 3114 from 3114 from 3078;
a. Resistance 3850
b. Traded Venture
c. Traded Yangzijiang
c. Sold 1/2 Jardine Matheson
d. Sold 1/2 Jardine Strategic
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22493 from 21799 from 21410;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Higher; 1571 from 1557 from 1558;
a. Bought Gabungan AQRS Warrants
b. Traded MYEG
c. Sold Gabungan AQRS
d. Sold Gamuda
e. Sold 3/4 MNRB
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-On (Data from XE.com on Oct 19 @ 9.30 AM)

1. USD to JPY - JPY Weaker; 108.41 from 108.38 last week from 106.94 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0675 from 3.0332 from 3.0315;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.6855 from 0.6790 from 0.6754;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger; 0.9351 from 0.9321 from 0.9321;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger; 2.8679 from 2.8422 from 2.8273;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1173 from 1.1041 from 1.0964;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8438 from 7.8434 from 7.8430;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1854 from 4.1860 from 4.1862;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3641 from 1.3728 from 1.3799;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 7.0821 from 7.0882 from 7.1488;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2975 from 1.2649 from 1.2302;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.4283 from 5.2950 from 5.1499;

13. Dollar Index - USD Weaker; 97.28 from 98.30 from 98.94;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market (US$3.4t); US$3.9 @ Sub-Prime Crisis; Lowes US$2.6t;
n. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers
7. Insiders Selling: US$26b till date; Highest US$37b in 2000

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Higher; 1.75% from 1.73% last week from 1.55% two weeks ago

Yield on 2 Year Treasuries - Lower; 1.57% from 1.59% from 1.42%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 17%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 108.47 from 108.08 from 107.34;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 87.09 from 86.77 from 86.16;

Baltic Dry Index - Lower; 1855 from 1924 from 1757; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Oct 20, 2019 8:57 am

TOL @ Oct 20, 2019

sell.png

Sell When There Are Buyers

The markets have not gone anywhere over past week and I'm starting to wonder whether it's still a "Trading Market" instead of a "Buy & Hold Market".

One could now see the buyers disappearing and the sellers outnumbering the buyers on many counters.

I have had a few counters where I decided to wait one more day to sell and on the next day, there were no longer any buyers.

Therefore, maybe it's still a "Trading Market" and I may need to sell whenever there are buyers.

Anyway, I have been selling some counters over the past few days. This is because there was a formula error on my spreadsheet and my equities exposure was much more than what I thought it was. I only realized this mistake when the Cash levels in my brokerage accounts were very low. I have since brought my exposure to Equities down to 28% of my Liquid Assets from 37% last week.

I'm still not expecting a plunge in the markets because there's no euphoria yet. In addition, the Central Banksters can still support the markets whenever the economy is weak.

However, the "Water Torture" that we have to endure is a bit uncomfortable and maybe it's best to be a bit cautious from now on.

On the horizon, we have Brexit and the FOMC Meeting on Oct 30-31. I'm expecting both events to be non-eventful.

In the meantime, we also have the circus in the White House, from Syria to Iran to the Impeachment to the Trade Wars and one is probably a bit numb and fed up with the "noise".

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (28% from 37% of Liquid Assets last week)
Goal: 10% exposure to Equities before the next recession (2020-2021?); Maximum 35%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - No Progress
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Progress (25 from 33 last week)
Goal: To focus on about 8 to 12 counters only

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
c. Heavy exposure to HK
d. Heavy exposure to Commercial Property counters
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 8 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 7 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 7 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 51 out of 70 (73%); (Safe: 60%; Danger: 85%)

Commodities: Risk-On (Data from Commodities Live on Oct 19 @ 9.50 AM)

1. WTI Oil - Lower. US$53.72 from US$54.88 last week from US$52.98 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -300 bpd; Nigeria -300k bpd; Iraq -200k bpd; Kurdistan -400k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd; Ecuador -1m bod; Net: -3.8m bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. EV: -350k bpd?
n. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Flat. US$1493 from US$1493 from US$1510;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Higher; US$2.64 from US$2.62 from US$2.54;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Higher. 2986 from 2970 last week from 2962 two weeks ago;
a. Support: 2750; 2320; Resistance: 2940; 3025; 3260; Fwd PE 16
b, Sold Alibaba (BABA)
c. Sold Alphabet (GOOG)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 26720 from 26308 from 25821;
a. Support: 25000, 24500, 23500; 22000;
b. Resistance: 29000; 31200, 31600;
c. Sold AIA
d. Sold Foxconn International
e. Sold Henderson land
f. Sold Sun Hung Kai Properties
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 2938 from 2974 from 2905;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Flat; 3114 from 3114 from 3078;
a. Resistance 3850
b. Traded Venture
c. Traded Yangzijiang
c. Sold 1/2 Jardine Matheson
d. Sold 1/2 Jardine Strategic
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22493 from 21799 from 21410;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Higher; 1571 from 1557 from 1558;
a. Bought Gabungan AQRS Warrants
b. Traded MYEG
c. Sold Gabungan AQRS
d. Sold Gamuda
e. Sold 3/4 MNRB
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-On (Data from XE.com on Oct 19 @ 9.30 AM)

1. USD to JPY - JPY Weaker; 108.41 from 108.38 last week from 106.94 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0675 from 3.0332 from 3.0315;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.6855 from 0.6790 from 0.6754;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger; 0.9351 from 0.9321 from 0.9321;
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger; 2.8679 from 2.8422 from 2.8273;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1173 from 1.1041 from 1.0964;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8438 from 7.8434 from 7.8430;
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1854 from 4.1860 from 4.1862;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3641 from 1.3728 from 1.3799;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 7.0821 from 7.0882 from 7.1488;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2975 from 1.2649 from 1.2302;
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.4283 from 5.2950 from 5.1499;

13. Dollar Index - USD Weaker; 97.28 from 98.30 from 98.94;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Negative Yield on some European JUNK Bonds
m. Money Market (US$3.4t); US$3.9 @ Sub-Prime Crisis; Lowes US$2.6t;
n. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers
7. Insiders Selling: US$26b till date; Highest US$37b in 2000

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Higher; 1.75% from 1.73% last week from 1.55% two weeks ago

Yield on 2 Year Treasuries - Lower; 1.57% from 1.59% from 1.42%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. Argentina's Intertest Rate: 60%
d. Turkey's Interest Rate: 17%
e. Ukraine's Interest rate: 18%
f. German 10-year bunds at -0.167% as of May 30, 2019
g. Japanese 10-year JGB at -0.1% as of May 30, 2019
h. 6 Developed market and 13 EM central banks to ease in 2H 2019
i. Greek's 10 Years Bonds are about 2%, less than US 10 Years Treasuries
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 108.47 from 108.08 from 107.34;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 87.09 from 86.77 from 86.16;

Baltic Dry Index - Lower; 1855 from 1924 from 1757; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Oct 27, 2019 8:55 am

TOL @ Oct 27, 2019

Bearish.jpg

Bearish Sentiments?

The following was from "Daily Weath", which mentioned that sentiment now is extremely bearish:-

1. Bank of America's monthly "Fund Manager Survey" shows that money managers are cautious on the stock market and the macroeconomic environment. Their cash allocations rose from 4.7% to 5%. That is an extremely high level of cash.

2. According to the American Association of Individual Investors ("AAII"), optimism recently fell to its lowest level in three and a half years. Pessimism was "unusually" high as well.

3. According to the Investment Company Institute, "US Domestic Equity Mutual Funds" saw outflows of $11.16 billion for the week ending October 2, "Global Equity Funds" saw outflows of $2.6 billion and "Domestic Bond Funds" saw inflows of $5.2 billion.

The article then asked you to bet against the crowd ie. to buy when everyone is so bearish.

However, I have been struggling with such recommendations over the years.

"Contrarian Investing" does work but one will need a longer time frame for it. In the meantime, are you prepared to sit on a losing position for a long time?

In this case, I would prefer to stand aside and wait for a "catalyst" to emerge, that may encourage people to be less bearish including:-
1. Better than expected earnings
2. Central Banksters printing a lot of money for a long time
3. Phase Two of the US-China Trade Truce signed as well
4. Emergence of a less erratic US President, who does not use Twitter everyday

In the meantime, you still have to contend with the following:-
1. The global economy is slowing
2. Businesses are not that willing to invest or expand
3. Individuals are not that willing to spend on big ticket items
4. Baby-Boomers slowly cashing out of their Equities for their retirement
5. Riots emerging throughout the world

Under such a situation, I would prefer to do the following:-
1. Limit my exposure to Equities; Maximum 35% for the time being
2. Raise Cash
3. Having my Cash in strong currencies eg. USD

However, it's still not the time to aggresively short the markets yet. Things are not euphoric and there are a lot of Cash on the sidelines.

Anyway, trading the market nowadays is a a bit difficult. This is because the pool of "inexperienced retail investors" have shrunk. And the people that are in the market nowadays, are more experienced and better informed. Maybe that's also the reason why so many Hedge Funds are closing shop nowadays.

On the horizon, we have the following:-
1. Oct 28 - 31: CPCCC Meeting in Beijing; Probably Non-Event
2. Oct 30 - 31; FOMC Meeting; Probably a 25 bps interest rate cut
3. Oct 31; Brexit; What a circus!

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (25% from 37% of Liquid Assets two weeks ago)
Goal: 10% exposure to Equities before the next recession (2020-2021?); Maximum 35%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - No Progress
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Progress (24 from 33 two weeks ago)
Goal: To focus on about 8 to 12 counters only

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Jardine Group
c. Heavy exposure to HK Equities
d. Heavy exposure to Commercial Property counters
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 8 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 7 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 7 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 51 out of 70 (73%); (Safe: 60%; Danger: 85%)

Commodities: Risk-On (Data from Commodities Live on Oct 19 @ 9.50 AM)

1. WTI Oil - Higher. US$56.66 from US$53.72 last week from US$54.88 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars will reduce demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?; Heavy Oil
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India and Japan combined); Heavier;
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer) - Reserve life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Brazil +200k bpd; Canada -300 bpd; Nigeria -300k bpd; Iraq -200k bpd; Kurdistan -400k bpd; Libya -500k bpd; Russia -500k bpd; Venezeula: -400k;
Iran: 2.6m bpd; -400k bpd; Ecuador -1m bod; Net: -3.8m bpd
k. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
l. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut); Fiscal Break-Even US$85;
m. EV: -350k bpd?
n. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1507 from US$1493 from US$1493;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Higher; US$2.68 from US$2.64 from US$2.62;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Higher. 3023 from 2986 last week from 2970 two weeks ago;
a. Support: 2750; 2320; Resistance: 3025; 3260; PE 18
b, Bought Twitter (TWTR)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Lower. 26667 from 26720 from 26308;
a. Support: 25500, 24500, 23500; 22000;
b. Resistance: 27300; 29000; 31600;
c. Sold 1/2 Xiomi
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 2955 from 2938 from 2974;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3185 from 3114 from 3114;
a. Resistance 3850
b. Bought Venture
c. Sold Yangzijiang
c. Sold Jardine Matheson
d. Sold HPL
e. Sold 1/2 Jardine Strategic
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22780 from 22493 from 21799;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1570 from 1571 from 1557;
a. Traded MNRB
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-Off (Data from XE.com on Oct 25 @ 5.30 PM)

1. USD to JPY - JPY Weaker; 108.61 from 108.41 last week from 108.38 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0716 from 3.0675 from 3.0332;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.6827 from 0.6855 from 0.6790;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker; 0.9305 from 0.9351 from 0.9321;
a. The range is 0.98 (2016) to 1.36 (2012)

5. AUD to MYR - AUD Weaker; 2.8577 from 2.8679 from 2.8422;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1118 from 1.1173 from 1.1041;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8379 from 7.8438 from 7.8434;
a. USD Peg band: 7.75 to 7.85
b. Will they remove the peg to the USD during the next crisis?
c. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.1864 from 4.1854 from 4.1860;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3631 from 1.3641 from 1.3728;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catatrophe can wipe them out but Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 7.0707 from 7.0821 from 7.0882;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.2836 from 1.2975 from 1.2649;
a. Brexit
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Weaker; 5.3736 from 5.4283 from 5.2950;

13. Dollar Index - USD Stronger; 97.60 from 97.28 from 98.30;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Money Market (US$3.4t); US$3.9 @ Sub-Prime Crisis; Lowes US$2.6t;
m. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers
7. Insiders Selling: US$26b till date; Highest US$37b in 2000

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Higher; 1.79% from 1.75% last week from 1.73% two weeks ago

Yield on 2 Year Treasuries - Higher; 1.62% from 1.57% from 1.59%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. 6 Developed market and 13 EM central banks to ease in 2H 2019
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 108.86 from 108.47 from 108.08;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 87.39 from 87.09 from 86.77;

Baltic Dry Index - Lower; 1785 from 1855 from 1924; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

by **winston** » Sun Nov 03, 2019 9:26 am

TOL @ Nov 3, 2019

nov.jpg

New Money From The New Month

It's a new month again so new money would be flowing into the markets again.

Therefore, we should see a spike in the markets next week unless the fund managers have already spent their cash in advance. (Dont forget that the Cash Levels at most US Mutual Funds are very high, at 4% to 5%).

Thereafter, the markets are hoping that:-
1. Phase One of the Trade War would be signed on Nov 17
2. US Earnings would keep the rally going and
3. If there's a plunge, QEs by the US Fed, ECB and BoJ, will save the markets

I would not be surprised if the PPT has been pumping the markets up recently as there is a need to divert public attention from the botched strategy of withdrawing from Northern Syria and the current impeachment process.

My strategy remains cautious:-
1. Selling into the rally
2. Raising Cash
3. Managing Risk
4. Monitoring Position Size
5. Monitoring Trailing Stop Loss
6. Having a Time Expiry on trades
etc.

I'm fully aware that I missed out on some small gains (especially when we may have the traditional Santa Rally) but it's a risk that I'm willing to take, in view of the following:-
1. Worsening global economy
2. Erratic US President
3. Various geopolitical issues (including any revenge by ISIS, Iran)
4. Brextit (probably a non-event as the UK economy is now only a fraction of it's past)
5. Various trade wars (China, EU, Japan-Korea etc)
6. Impeachment Of Trump
etc.

This not mean that I will not be trading any convincing story. It only means that I will be thinking a few times before I pull my next trigger. It also means that I may not think twice about pocketing any small profits.

Weekly Risk Management Progress Report:-

1. To Monitor Exposure To Equities: Neutral (22% from 37% of Liquid Assets three weeks ago)
Goal: 10% exposure to Equities before the next recession (2020-2021?); Maximum 30%;

2. To Diversify From Asian Equities: No Progress
Goal: To reduce percentage of Asian Equities to around 50%

3. To Buy Inverse ETFs and Puts - Bought 7500 (Inverse HK 2x)
Goal: To have a sizable short position going into the next recession

4. To Increase "USD/HKD/Gold" - No progress. Still at about 30%.
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Progress (19 from 33 three weeks ago)
Goal: To focus on about 8 to 12 counters only

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
Goal: To diversify across various sectors and countries

Market Risk Indicators

1. Euphoria: 8 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;

2. Credit Problems: 7 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 7 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 7 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 7 (Safe 1: PE15; Danger 10) PE S&P, Nadsaq; Revenue; USD; Tax Reform; Deregulation

7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia; Iran;

Total: 51 out of 70 (73%); (Safe: 60%; Danger: 85%)

Commodities: Risk-Off (Data from Commodities Live on Nov 1 @ 9.00 PM)

1. WTI Oil - Lower. US$54.75 from US$56.66 last week from US$53.72 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105;
a. Trade Wars reducing demand for Oil; -1m bpd?
b. US: Stockpiles: Reducing?
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years;
d. US imports 8m bpd (Total demand of India & Japan combined);
e. US: Lighter Crude and Lower Sulphur; 2018 Production +17% yoy;
f. US Break-Even; Permian: US$35 to US$50; Shale: US$50
g. US Shale Debt: US$9b maturing in 2019; US$137b to mature between 2020-2022
h. China (4th largest producer; largest importer); Reserve Life dropped from 10 to 6 years; Ban on Petrochemical Cars in 5-10 years? Quotasj
i. China: SPR 51/90 days; 2019 imports to decrease?
j. IEA: Glut in 2020
k. Saudi: Aramco's IPO; -1.3m bpd (35% cut); Fiscal Break-Even US$85;
l. EV: -350k bpd?
m. Opec: Cut 2.3m bpd since Nov 2018; 9 months extension (April 2020)
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1510 from US$1507 from US$1493;
Support: $1240; $1150; $1050; Resistance: $1575; $1775; $1830;
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. China: PBOC has been buying gold over the past few months
e. Demand from Muslim countries as Gold is now a halal investment
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. China: Jewelry: +3% yoy; Industrials -10% yoy; PBOC: 2.4% forex reserves vs US 74%; Retail; Safe Haven: RMB lost 1/3 vs Gold since Jun 2007;
k. Global Demand: China +5%; India -8%;
l. Central Banks: +70% yoy; 33k tons; Poland, Turkey, Khazakhstan & India
m. U.S. government holds 260m ounces at book value of only US$42m
n. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy; Added 100 tons since Dec 2018
o. Russia: US$109b worth of gold
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Copper - Lower; US$2.64 from US$2.68 from US$2.64;
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

4. No longer monitoring Palladium, Cobalt, Uranium, Silver, Platinum and Zinc on a weekly basis

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

1. US Equities - Higher. 3067 from 3023 last week from 2986 two weeks ago;
a. Support: 2750; 2320; Resistance: 3025; 3260; PE 18
b, Sold Kraft Heinz (KHC)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 27101 from 26667 from 26720;
a. Support: 25500, 24500, 23500; 22000;
b. Resistance: 27300; 29000; 31600;
c. Bought 7500 (2x Inverse Hang Seng)
d. Sold 1/2 MMG (1208)
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 2958 from 2955 from 2938;
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3229 from 3185 from 3114;
a. Resistance 3850
b. Bought HPL
c. Sold Venture
d. Sold Jardine Strategic
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22851 from 22780 from 22493;
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Higher; 1593 from 1570 from 1571;
a. Sold Genting Malaysia
b. Sold 1/4 Genting Berhad
c. Sold Hume Industry
d. Sold Gabungan AQRS Warrants
viewtopic.php?f=10&t=6292&start=30

Currencies - Risk-Off (Data from XE.com on Nov 01 @ 8.50 PM)

1. USD to JPY - JPY Stronger; 108.19 from 108.61 last week from 108.41 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0666 from 3.0716 from 3.0675;
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.6892 from 0.6827 from 0.6855;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger; 0.9361 from 0.9305 from 0.9351;
a. The range is 0.98 (2016) to 1.36 (2012)

5. AUD to MYR - AUD Stronger; 2.8709 from 2.8577 from 2.8679;
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1131 from 1.1118 from 1.1173;
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8372 from 7.8379 from 7.8438;
a. USD Peg band: 7.75 to 7.85
b. Will they remove the peg to the USD during the next crisis?
c. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1653 from 4.1864 from 4.1854;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

9. USD to SGD:- SGD Stronger; 1.3584 from 1.3631 from 1.3641;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catatrophe can wipe them out but Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 7.0418 from 7.0707 from 7.0821;
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.2941 from 1.2836 from 1.2975;
a. Brexit
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.3909 from 5.3736 from 5.4283;

13. Dollar Index - USD Weaker; 97.44 from 97.60 from 97.28;
viewtopic.php?f=32&t=7616&start=60

Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$247t, 320% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. US Social Security & Medicare Short-Fall: US$100t; 2034 Bankrupt; US$3t US Treasuries
i. NPLs at European Banks: EUR$1t
j. China's Bond Market: US$12t (third largest)
k. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
l. Japanese government’s debt highest in the world: 1.1 QUADRILLION yen (about USD $10 trillion), twice the size of its entire economy.
m. US Student Debt: US$1.7t
viewtopic.php?f=16&t=8930&start=140

Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$16t as of Aug 16, 2019)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities US$600b Cash
l. Money Market (US$3.4t); US$3.9 @ Sub-Prime Crisis; Lowes US$2.6t;
m. ECB: Interest rates at -0.05%; QE: Eur 20b/ month starting Nov 2019;
viewtopic.php?f=16&t=8940&start=30

Warning Signs
1. Bearish Divergence - Small Caps
2. Narrow Participation - New Highs
3. Inverted Yield
4. Weak Transportation Numbers - Dow Theory
5. Strong Precious Metal Sector
6. Weak Manufacturing Numbers
7. Insiders Selling: US$26b till date; Highest US$37b in 2000

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants
viewtopic.php?f=16&t=7547&start=120

Properties
a. I'm no longer closely monitoring Properties in HK, China, Malaysia and Singapore.
b. I believe that the properties in these countries will not be going anywhere over the next few years.

Yield on 10 Year US Treasuries - Lower; 1.70% from 1.79% last week from 1.75% two weeks ago

Yield on 2 Year Treasuries - Lower; 1.55% from 1.62% from 1.57%;

Interest Rates:-
a. About US$13t or about 1/3 of the world’s bonds have negative yields
b. US Rate Hike: Two more 25 bps cut by end 2019?
c. 6 Developed market and 13 EM central banks to ease in 2H 2019
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 108.19 from 108.86 from 108.47;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 86.81 from 87.39 from 87.09;

Baltic Dry Index - Lower; 1731 from 1785 from 1855; Low 290; High 2330 (2013)

The above is to from help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do feel free to provide me with your kind thoughts and comments

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.
viewtopic.php?f=14&t=2823&start=40

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
search.php?search_id=active_topics

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