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

[winston]

TOL @ Oct 11, 2020

Earnings.jpg

US 3Q Earnings

We will be heading into US 3Q Earnings next Tuesday.

The consensus is that US 3Q Earnings will again surprise on the upside.

Of the 67 companies that have issued earnings guidance for the third quarter, only 22 have issued negative guidance.

According to FactSet, the S&P 500’s third-quarter earnings is expected to decline by an average of 21.8%.

However, third-quarter revenue is only forecast to dip an average 3.8%, thanks to the weak USD.

In view of the above, maybe it is not a good idea to be too bearish on the US markets, despite the expected volatility before the US election.

As for myself, I'm still forcing myself to take a "Trading Break" and to not pursue any investment ideas, unless it has a very convincing story.

For next week, I will be watching:-
1. Malaysia: Oct 13: Anwar is supposedly meeting the King
2. US: Oct 13 - Beginning of US 3Q Earnings


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (25% from 29% last week from 27% two weeks ago, of Liquid Assets)
Goal: 5% exposure to Equities before the next crash; Maximum 30%;

2. To Diversify From Asian Equities: Progress (81% from 88% from 92%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Progress (21 from 22 from 22)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks: Progress; (72% from 75% from 74% Value Stocks).
Goal: Exposure to 50% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (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: 6 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 9 (Safe 1: 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; Iran;

Total: 55 out of 70 (79%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$40.55 from US$36.97 last week from US$40.05 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1936 from US$1904 from US$1864;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Flat; US$3.08 from US$2.98 from US$2.98;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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

1. US Equities - Higher; 3477 from 3348 last week from 3298 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. Bought Draft Kings (DKNG)

2. HK Equities - Higher. 24119 from 23459 from 23235;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. Sold China Life

3. Shanghai Equities - Higher; 3272 from 3218 from 3219;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Higher; 2533 from 2496 from 2472;
Resistance 3850
a. Sold Riverstone
b. Sold Jardine Strategic
c. Sold 1/3 Wilmar

5. Japan Equities - Higher. 23620 from 23030 from 23205;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Higher; 1530 from 1500 from 1509;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Bought Hume Industries
c. Sold 2/3 MUI Properties


Currencies: Risk-On (Data from XE.com on Oct 10 @ 6.00 PM)

1. USD to JPY - JPY Flat; 105.63 from 105.60 last week from 105.25 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Umlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0545 from 3.0459 from 3.0306;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7238 from 0.7162 from 0.7069;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.1831 from 1.1717 from 1.1669;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Strong. 7.7502 from 7.7499 from 7.7500;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger. 4.1388 from 4.1609 from 4.1667;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3550 from 1.3661 from 1.3747;
a. High 1.70 (2004); Low 1.20 (2011)
b. Uncomfortable holding the currency of a small country where a catastrophe can wipe them out; But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.6947 from 6.7905 from 6.8179;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Stronger; 1.3048 from 1.2858 from 1.2767;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Stronger; 5.3994 from 5.3500 from 5.3214;

11. Dollar Index - USD Weaker; 93.06 from 93.86 from 94.26;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 0.78% from 0.67% last week from 0.67% two weeks ago

Yield on 2 Year Treasuries - Higher; 0.16% from 0.13% from 0.14%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 104.15 from 103.18 from 105.16;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 84.95 from 83.83 from 83.10;

Baltic Dry Index - Higher; 1892 from 1725 from 1605; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

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

[winston]

TOL @ Oct 18, 2020

Beating Expectations.jpg

Is Beating Expectations Enough Nowadays?

The US markets has not gone anywhere since the beginning of 3Q Earnings Season.

I'm starting to think that maybe, beating expectations may no longer be adequate, to propel the markets much higher.

The markets have gone up a lot since the March low while:-
1. The Economy is now much weaker
2. The Unempoyment Rate is now much higher
3. The Covid19 situation is still not under control
4. The Political & Social en[url][/url]vironment is not getting better
5. Rolling Lockdowns, Travel Restrictions etc.
6. Coming Winter Flu Season
7. Trade War, Cold War and Hot War, simmering in the background
etc.

However, various Strategists still believe that the markets can fly higher:-
1. There's US$1t Cash sitting on the sidelines
2. They think that another Stimulus Bill in the US is possible
3. The Excess Liquidity from Unlimited QE (US$7t) is still sloshing in the system
4. Post US Election will remove an uncertainty for the markets
5. A Vaccine is on the way. (It does not matter that it may not be safe or will need years to reach 8b doses).
6. China: First In, First Out; Growth
etc.

As for myself, I'm still on an extended Trading Break. I'm still forcing myself not to trade unless there's an extremely convincing story.

For next week, we have the following:-
1. US: Oct 22: Final Presidential Debate; (Does that look like a debate to you?)


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (28% from 25% lst week from 29% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Worse (83% from 81% from 88%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: No Progress (21 from 21 from 22)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks: Progress; (68% from 72% from 75% Value Stocks).
Goal: Exposure to 50% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (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: 6 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 9 (Safe 1: 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; Iran;

Total: 55 out of 70 (79%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$40.77 from US$40.55 last week from US$36.97 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1903 from US$1936 from US$1904;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Lower; US$3.06 from US$3.08 from US$2.98;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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

1. US Equities - Higher; 3484 from 3477 last week from 3348 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. No Trade

2. HK Equities - Higher. 24387 from 24119 from 23459;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. No Trade

3. Shanghai Equities - Higher; 3336 from 3272 from 3218;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Higher; 2533 from 2496 from 2472;
Resistance 3850
a. Traded Wilmar

5. Japan Equities - Lower. 23411 from 23620 from 23030;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Lower; 1504 from 1530 from 1500;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Added to Hume Industries


Currencies: Risk-Off (Data from XE.com on Oct 16 @ 3.30 PM)

1. USD to JPY - JPY Stronger; 105.31 from 105.63 last week from 105.60;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Umlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0556 from 3.0545 from 3.0459;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7092 from 0.7238 from 0.7162;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.1710 from 1.1831 from 1.1717;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Strong. 7.7501 from 7.7502 from 7.7499;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker. 4.1526 from 4.1388 from 4.1609;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3593 from 1.3550 from 1.3661;
a. High 1.70 (2004); Low 1.20 (2011)
b. Uncomfortable holding the currency of a small country where a catastrophe can wipe them out; But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.7143 from 6.6947 from 6.7905;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Weaker; 1.2912 from 1.3048 from 1.2858;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Weaker; 5.3621 from 5.3994 from 5.3500;

11. Dollar Index - USD Stronger; 93.77 from 93.06 from 93.86;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Lower; 0.73% from 0.78% last week from 0.67% two weeks ago

Yield on 2 Year Treasuries - Lower; 0.14% from 0.16% from 0.13%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 105.34 from 104.15 from 103.18;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 84.73 from 84.95 from 83.83;

Baltic Dry Index - Higher; 1561 from 1892 from 1725; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

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

[winston]

TOL @ Oct 25, 2020

buy-sell-or-hold.jpg

"Buy, Sell or Hold" Before The US Election?

The US Markets have not gone anywhere in the second week of 3Q Earnings.

As mentioned last week, I think that beating expectations this quarter, may not be enough to send a stock much higher.

And if a stock does fly higher, profit taking would probably set in.

I think that everybody knows that Valuation is very stretched now but people continue to hold, in view of the perceived Liquidity sloshing in the system.

However, that Liquidity can also very quickly disappear, if there's a "sudden huge external violent shock" to the system.

Having said that, I think that the US Markets would not crash before the US election.

There's a vested interest to keep the US Markets elevated and it does not require a huge slush fund to control the indices, through the 6 Big Techs, by buying a huge amount of expiring Call Options.

The consensus now is that the markets would probably rise after the election as a major uncertainty is being removed (provided that it's a straight-forward win).

Thereafter, if the rise is a bit too much, reality would probably set in, together with some tax-loss selling, by the end of the year.

Anyway, I think that there are too many moving parts now so I'm not spending much time on such issues.

For next week, we have the following:-
1. Oct 26: Malaysia: Emergency Rule? And would the markets really crash if there's Emergency Rule as proclaimed by Tun M?
2. Oct 26: Malaysia; Mr DIY IPO
3. Oct 26-29: China; CPCCC Meeting; Which sector will benefit?
4. Oct 29: US; Jul-Sep GDP Numbers


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (32% from 28% last week from 25% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Worse (85% from 83% from 81%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be repegged)

5. To Reduce Number Of Counters: Worse (25 from 21 from 21)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks: Progress; (64% from 68% from 72% Value Stocks).
Goal: Exposure to 50% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (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: 6 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 9 (Safe 1: 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; Iran;

Total: 55 out of 70 (79%); (Safe: 60%; Danger: 85%)


Commodities: Mixed (Data from Commodities Live every Saturday)

1. WTI Oil - Lower. US$39.75 from US$40.77 last week from US$40.55 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Flat. US$1904 from US$1903 from US$1936;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Higher; US$3.14 from US$3.06 from US$3.08;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


Equities - Mixed (Data as of Saturday every week)

1. US Equities - Lower; 3465 from 3484 last week from 3477 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. No Trade

2. HK Equities - Higher. 24918 from 24387 from 24119;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. Bought Vinda

3. Shanghai Equities - Lower; 3278 from 3336 from 3272;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Higher; 2537 from 2533 from 2496;
Resistance 3850
a. Added to Wilmar

5. Japan Equities - Higher. 23517 from 23411 from 23620;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Lower; 1495 from 1504 from 1530;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Bought Hartalega
c. bought Supermax
d. Bought Top Glove


Currencies: Risk-On (Data from XE.com on Oct 23 @ 2.15 PM)

1. USD to JPY - JPY Stronger; 104.72 from 105.31 last week from 105.63 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Umlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0577 from 3.0556 from 3.0545;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7107 from 0.7092 from 0.7238;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.1794 from 1.1710 from 1.1831;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Strong. 7.7501 from 7.7501 from 7.7502;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Flat. 4.1529 from 4.1526 from 4.1388;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3582 from 1.3593 from 1.3550;
a. High 1.70 (2004); Low 1.20 (2011)
b. Uncomfortable holding the currency of a small country where a catastrophe can wipe them out; But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.6860 from 6.7143 from 6.6947;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Stronger; 1.3056 from 1.2912 from 1.3048;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Stronger; 5.4213 from 5.3621 from 5.3994;

11. Dollar Index - USD Weaker; 93.08 from 93.77 from 93.06;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 0.85% from 0.73% last week from 0.78% two weeks ago

Yield on 2 Year Treasuries - Higher; 0.15% from 0.14% from 0.16%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 105.40 from 105.34 from 104.15;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 84.77 from 84.73 from 84.95;

Baltic Dry Index - Lower; 1401 from 1561 from 1892; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

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

[winston]

TOL @ Nov 01, 2020

nov.jpg

New Money From The New Month

It's a new month again so new money should be flowing into the markets next week.

However, we do have the US Election on Nov 03, so the market participants may be a bit cautious until the results are being announced.

The consensus is that the US Markets will go up after the election, no matter who wins, as a huge uncertainty would have being removed (as long as it's a clear cut win and there are no challenges).

As for myself, I have being slowly buying on the dips. Hopefully, I would be able to pare some of my positions when it does rise after the US election before tax-loss selling at the end of the year.

At the same time, China is recovering well from the Covid19 so I should be pivoting my portfolio towards that area.

For next week, we have the following:-
1. Nov 3, 2020: US Presidential Election; I'm expecting Biden to win;
2. Nov 4, 2020: US FOMC Meeting
3. Nov 6: Malaysian Budget; Which sector will be affected?


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (35% from 32% last week from 28% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Progress(82% from 85% from 83%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be pegged)

5. To Reduce Number Of Counters: Worse (29 from 25 from 21)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks: Worse; (66% from 64% from 68% Value Stocks).
Goal: Exposure to 50% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (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: 5 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 8 (Safe 1: 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; Iran;

Total: 52 out of 70 (74%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Lower. US$35.77 from US$39.75 last week from US$40.77 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1879 from US$1904 from US$1903;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Lower; US$3.05 from US$3.14 from US$3.06;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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


1. US Equities - Lower; 3270 from 3465 last week from 3484 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. Bought SAP
c. Bought Twitter

2. HK Equities - Lower. 24107 from 24918 from 24387;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. Bought China Life
d. Bought China Mobile
e. Added to ASM Pacific
f. Traded CICC

3. Shanghai Equities - Lower; 3225 from 3278 from 3336;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Lower; 2424 from 2537 from 2533;
Resistance 3850
a. Traded Riverstone

5. Japan Equities - Lower. 22977 from 23517 from 23411;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Lower; 1467 from 1495 from 1504;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. No Trade


Currencies: Risk-Off (Data from XE.com on Oct 31 @ 7.45 PM)

1. USD to JPY - JPY Stronger; 104.66 from 104.72 last week from 105.31 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0400 from 3.0577 from 3.0556;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7029 from 0.7107 from 0.7092;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.1646 from 1.1794 from 1.1710;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.7520 from 7.7501 from 7.7501;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Flat. 4.1535 from 4.1529 from 4.1526;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3663 from 1.3582 from 1.3593;
a. High 1.70 (2004); Low 1.20 (2011)
b. Uncomfortable holding the currency of a small country where a catastrophe can wipe them out; But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.6926 from 6.6860 from 6.7143;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Weaker; 1.2951 from 1.3056 from 1.2912;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Weaker; 5.3792 from 5.4213 from 5.3621;

11. Dollar Index - USD Stronger; 94.04 from 93.08 from 93.77;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 0.87% from 0.85% last week from 0.73% two weeks ago

Yield on 2 Year Treasuries - Higher; 0.16% from 0.15% from 0.14%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 104.30 from 105.40 from 105.34;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 83.88 from 84.77 from 84.73;

Baltic Dry Index - Lower; 1283 from 1401 from 1561; Low 290; High 2330 (2013)

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

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

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


Please Note:-

The above is to 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

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

Support The Forum - 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. The buttom is at the top right hand corner.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

[winston]

TOL @ Nov 08, 2020

Selling Opportunity.jpg

Sell Into The Strength?

The markets have been strong over the past week and I've been selling into the strength.

I was actually planning to wait for the results of the US election first before selling but the rise was just too fast and furious.

If the market rises further next week, I will probably continue to sell some more, to raise some Cash.

Intuitively, I think that there would be a "Great Reset", starting with the Biden Win, as well as better Covid19 tests, treatments and a vaccine (hopefully safe) later.

The "K" shaped rebound has been spectacular and I need to make a judgement on whether it can continue further, without a major decline of say 15% to 20%.

A Biden Win would be good for humanity. The question is whether Trump will leave quietly or will start a Civil War. Dont forget that everyone is armed in the US, some with automatic assault weapons. A 50% support for Trump shows that the US is deeply divided and full of hatred.

In Singapore now, they now have a 15 minutes Covid19 tests before they allow people onto their "Cruise To Nowhere". I can see this Covid19 test being used in the future, at Airports, Stadiums, Trade Expos, Casinos etc. That means that there could be more opening up of the global economies.

For next week, we have the following:-
1. Nov 13, 2020: HK Hang Seng Index Constituents
2. US Presidential Election: Peaceful Handover or Civil War?


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (30% from 35% last week from 32% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Worse (84% from 82% from 85%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be pegged)

5. To Reduce Number Of Counters: Progress (26 from 29 from 25)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks
Goal: Exposure to 25% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 6 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

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

6. Valuation; 8 (Safe 1: 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; Iran;

Total: 52 out of 70 (74%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$37.46 from US$35.77 last week from US$39.75 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1952 from US$1879 from US$1904;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Higher; US$3.15 from US$3.05 from US$3.14;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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

1. US Equities - Higher; 3509 from 3270 last week from 3465 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. Sold Silver ETF (SLV)

2. HK Equities - Higher. 25713 from 24107 from 24918;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. Sold China Mobile
d. Sold Sunny Optical
e. Sold 1/2 Vinda
f. Traded Alibaba
g. Traded CICC

3. Shanghai Equities - Higher; 3312 from 3225 from 3278;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Higher; 2579 from 2424 from 2537;
Resistance 3850
a. Bought Capitaland
c. Sold 1/4 Wilmar

5. Japan Equities - Higher. 24325 from 22977 from 23517;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Higher; 1520 from 1467 from 1495;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Sold Hartalega
c. Traded Supermax


Currencies: Risk-On (Data from XE.com on Nov 06 @ 4.40 PM)

1. USD to JPY - JPY Stronger; 103.46 from 104.66 last week from 104.72 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0684 from 3.0400 from 3.0577;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7271 from 0.7029 from 0.7107;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.1846 from 1.1646 from 1.1794;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.7527 from 7.7520 from 7.7501;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger. 4.1358 from 4.1535 from 4.1529;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3477 from 1.3663 from 1.3582;
a. High 1.70 (2004); Low 1.20 (2011)
b. Uncomfortable holding the currency of a small country where a catastrophe can wipe them out; But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.6179 from 6.6926 from 6.6860;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Stronger; 1.3141 from 1.2951 from 1.3056;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Stronger; 5.4344 from 5.3792 from 5.4213;

11. Dollar Index - USD Weaker; 92.49 from 94.04 from 93.08;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Lower; 0.77% from 0.87% last week from 0.85% two weeks ago

Yield on 2 Year Treasuries - Lower; 0.15% from 0.16% from 0.15%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 106.47 from 104.30 from 105.40;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 85.53 from 83.88 from 84.77;

Baltic Dry Index - Lower; 1194 from 1283 from 1401; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

[winston]

TOL @ Nov 15, 2020

IE.jpg

Irrational Exuberance?

The Dow shot up 1500+ on the Pfizer announcement. Thereafter, there was also another announcement that a vaccine would be available around April 2021.

I'm not sure why people would be so excited with such a news and would be running off to buy the Airlines, Cruise Companies and to a smaller extent, the Energy Companies and Banks.

Perhaps they were short these companies so have to cover their position very quickly.

Logically, would you really be buying something, after it has gone up 30% in a day?

Anyway, didn't Trump mentioned before, that a vaccine would be available around the US election? So isn't April 2021 about 6 months later than what Trump had said?

And wouldn't the vaccine be only available to the masses only around Summer 2021, as they still need some time to ramp up their production and to distribute the vaccine through their "Four Phases"?

Assuming that the vaccine is "safe", wouldn't that be still around 6-9 months away? And in the meantime, are you not still having rolling lockdowns, record number of daily Covid-19 cases etc.?

Perhaps people can now see the light at the end of the long tunnel. And Sir John Templeton did mentioned before, that the "smart people" would be buying about 3-6 months before the upturn.

And with a Biden Presidency, they think that the Covid19 can now be controlled once and for all, probably after a 2 months lock-down, with compulsory mask wearing and social distancing.

Anyway, let me remind you that around March 2020, the "experts" were saying that this Covid19 would be over by Summer 2020. So we are now about a year off from what the "experts" were telling you.

So where does this lead us to?

When the Dow spiked up +1500 points with the US Big Techs being whacked on Monday, as people thought that there would be a "Great Rotation" from "Growth into Value", I used that opportunity to sell some of my Laggards and to rebuilt my position in the Chinese Big Techs and the Gloves Maker.

I chose to increase my exposure to China as they have managed to control the Covid19 better than the US. China is also relatively more "stable" at this point in time, despite the "noise" from their recent "New Micro-Financing Reserving Basis" and "Anti-Monopoly" regulations.

As for the Rubber Glove Makers, it's for a quick short-term trade. Although, I think that their ASPs may not rise that much in 2021, I think that they would still be printing a lot of money until the "New Supply" is on stream, probably sometime in 2H 2022. In the meantime, the world's Healthcare workers will not suddenly stop wearing gloves even when there's a vaccine in Summer 2021.

IMHO, I think that a "Great Rotation" from "Growth to Value", may materialise only later, say in Summer 2021. So the time to buy some US "Value" stocks would be around Spring 2021.

This is assuming that there would be a peaceful transition of power from Trump to Biden in January 2021 and there would not be a Civil War in the worst case scenario.

And in the case of a Civil War, I'm not sure that the Unlimited QE would be able to save the markets this time.

I also need to plan for the declining US Dollar. I'm not sure that Gold and Silver would be good hedges if things are unstable. That includes my HKG, which could be depegged if the USD crashes.

Finally, I have to also think about my exposure to the Emerging Market Currencies ie. MYR and SGD. (I have already sold my AUD in view of the current diplomatic situation between Australia and China).

In times of uncertainty, it does not hurt to raise some Cash when there are buyers that would be willing to pay a good price to you. When things go downhill quickly, you will not have the chance to run in time.

For people who has never experienced a Crash like 1987, 1997, Dot.com, Nikkei Crash, Asian Financial Crisis, Finanical Tsunami, you wouldn't know what I'm talking about. i would suggest that you googled and read about those events. March 2020 is nothing compared to those events.


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (30% from 30% last week from 35% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Worse (84% from 84% from 82%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be pegged)

5. To Reduce Number Of Counters: No Progress (26 from 26 from 29)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Glove Makers
d. Heavy exposure to China Big Tech
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks
Goal: Exposure to 25% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 6 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

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

6. Valuation; 8 (Safe 1: 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; Iran;

Total: 52 out of 70 (74%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$40.12 from US$37.46 last week from US$35.77 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1888 from US$1952 from US$1879;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Higher; US$3.18 from US$3.15 from US$3.05;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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

1. US Equities - Higher; 3585 from 3509 last week from 3270 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. Sold SAP
c. Sold Twitter

2. HK Equities - Higher. 26157 from 25713 from 24107;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. Bought Tencent
d. Bought Alibaba
e. Bought 3033 (Technology ETF)
f. Sold Soho China
g. Sold Fosun Pharma
h. Sold China Life
i. Sold 1/2 ASM Pacific
j. Traded JD.com
k. Traded Meituan

3. Shanghai Equities - Lower; 3310 from 3312 from 3225;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Higher; 2711 from 2579 from 2424;
Resistance 3850
a. Bought Riverstone
b. Sold Capitaland

5. Japan Equities - Higher. 25386 from 24325 from 22977;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Higher; 1590 from 1520 from 1467;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Bought Hartalega
c. Bought Supermax
d. Bought Top Glove
e. Sold Hume Industries


Currencies: Risk-On (Data from XE.com on Nov 13 @ 9.30 PM)

1. USD to JPY - JPY Weaker; 104.90 from 103.46 last week from 104.66 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0564 from 3.0684 from 3.0400;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7249 from 0.7271 from 0.7029;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.1824 from 1.1846 from 1.1646;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker. 7.7539 from 7.7527 from 7.7520;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger. 4.1229 from 4.1358 from 4.1535;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3489 from 1.3477 from 1.3663;
a. High 1.70 (2004); Low 1.20 (2011)
b. Uncomfortable holding the currency of a small country where a catastrophe can wipe them out; But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.6105 from 6.6179 from 6.6926;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Stronger; 1.3169 from 1.3141 from 1.2951;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Weaker; 5.4292 from 5.4344 from 5.3792;

11. Dollar Index - USD Stronger; 92.91 from 92.49 from 94.04;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 0.87% from 0.77% last week from 0.87% two weeks ago

Yield on 2 Year Treasuries - Higher; 0.18% from 0.15% from 0.16%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 106.10 from 106.47 from 104.30;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 85.15 from 85.53 from 83.88;

Baltic Dry Index - Lower; 1124 from 1194 from 1283; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

[winston]

TOL @ Nov 22, 2020

ignorance.jpg

Ignorance & Arrogance

In the past, I have written about the 4 emotions that can destroy a Trader, Speculator, Investor, Gambler or whatever that you like to call yourself.

Again, those 4 emotions are Fear, Greed, Ignorance and Arrogance.

Today, I would like remind myself of Ignorance and Arrogance.

When the markets spiked up on the vaccine news from Pfizer and Moderna, I dont quite understand why people would be so excited with the news and bought shares of Energy Companies, Banks, Airlines, Cruise Companies etc, even after they have gapped up 30%.

(Holding on the shares that have spiked up, is also equivalent to buying that counter at the current elevated price).

Did they really think that they could travel again very soon, take a cruise, visit the Casino, as in 2019?

In the past, for a vaccine to be declared safe, it takes about 6 months of testing on animals and another year of testing on humans, before it can be declared safe.

With this Covid19, I dont think they have gone thru the 1.5 years of testing but I can accept that there could be steps that they can eliminate.

So is this Covid19 Vaccine safe? I sincerely hoped that is, as they would be giving it first to the Healthcare workers. If there's any problem later, all the Healthcare workers would be affected.

For the flu season last year, the flu vaccine was only 30% effective. If that is the case, why are people assuming that the Covid 19 vaccine would now be 90% effective?

Just because the Covid19 vaccine is effective against the original Covid19 virus, can't the original Covid19 virus mutate like the flu? (My understanding is that there are already 5 strains of Covid19 now).

And how long can the Covid19 vaccine last? Do you need a new jab every year like the flu?

I know that I dont know enough about this Covid19 so I'm asking a lot of questions.. Are people also asking the same questions or are they now the "expert" on Covid19 just because they have read a few articles on it?

For next week, I would be watching the following:-
1. Malaysia: Nov 26: Vote on Budget
2. Malaysia: Dec 3: New constituents on Bursa; Will Supermax be included?

Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (28% from 30% last week from 30% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Progress (82% from 84% from 84%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be pegged)

5. To Reduce Number Of Counters: Progress (25 from 26 from 26)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Glove Makers
d. Heavy exposure to China Big Tech
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks
Goal: Exposure to 25% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;


3. Recession: 9 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 6 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

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

6. Valuation; 8 (Safe 1: 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; Iran;

Total: 52 out of 70 (74%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$42.44 from US$40.12 last week from US$35.77 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1870 from US$1888 from US$1952;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Higher; US$3.29 from US$3.18 from US$3.15;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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

1. US Equities - Lower; 3558 from 3585 last week from 3509 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. Sold 1/2 Draftkings

2. HK Equities - Higher. 26452 from 26157 from 25713;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. Bought China Overseas Land
d. Sold Tencent
e. Sold Meituan
f. Sold 1/2 Vinda

3. Shanghai Equities - Higher; 3378 from 3310 from 3312;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Higher; 2813 from 2711 from 2579;
Resistance 3850
a. No Trade

5. Japan Equities - Higher. 25527 from 25386 from 24325;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Higher; 1594 from 1590 from 1520;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Traded Hartalega
c. Traded Supermax


Currencies: Risk-On (Data from XE.com on Nov 20 @ 9.20 PM)

1. USD to JPY - JPY Stronger; 103.83 from 104.90 last week from 103.46 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0467 from 3.0564 from 3.0684;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7310 from 0.7249 from 0.7271;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.1864 from 1.1824 from 1.1846;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Stronger. 7.7529 from 7.7539 from 7.7527;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger. 4.0921 from 4.1229 from 4.1358;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3431 from 1.3489 from 1.3477;
a. High 1.70 (2004); Low 1.20 (2011)
b. Uncomfortable holding the currency of a small country where a catastrophe can wipe them out; But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.5684 from 6.6105 from 6.6179;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Stronger; 1.3268 from 1.3169 from 1.3141;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Weaker; 5.4294 from 5.4292 from 5.4344;

11. Dollar Index - USD Weaker; 92.33 from 92.91 from 92.49;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Lower; 0.83% from 0.87% last week from 0.77% two weeks ago

Yield on 2 Year Treasuries - Lower; 0.16% from 0.18% from 0.15%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 107.27 from 106.10 from 106.47;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.08 from 85.15 from 85.53;

Baltic Dry Index - Higher; 1134 from 1124 from 1194; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

[winston]

TOL @ Nov 29, 2020

December.jpg

New Money From The New Month

It's going to be a new month again so new money would be flowing into the markets again. Therefore, we should get a spike in the markets next week.

Thereafter, the Bulls are saying that the markets can continue to grind higher, for the following reasons:-
1. "Election Uncertainty" is now removed
2. "Santa Rally" is not too far away (normally the last 5 days of Dec and first two days of Jan)
3. "Year End Window Dressing" is also coming up
4. Various positive announcements on Covid19 Vaccines
5. Another "Stimulus Check" and various Stimulus Programs under Biden later
6. Yellen and Powell will be working well together
7. China, the second largest economy, is recovering
8. About US$20t is sloshing through the global system
etc.

On the other hand, the Bears are looking at the following:-
1. Handover Uncertainty
2. Trump's Scorched Earth Policy - more disruptions, sanctions, pardons etc.
3. Record Covid19 cases; Cases spiking from US Election, Europe and coming Winter;
4. High Equities Valuation
5. Inflation; Weak USD; Higher Food Prices; How will it affect the Unlimited QE?
6. High Unemployment, Millions of Evictions, Soaring Bankruptcies etc.
7. Tax Loss Selling; Selling in anticipation of higher Capital Gains Tax in 2021?
8. Record global debt of US$277t; 350% of Global GDP
9. Rebalancing of Portfolios from Equities into Bonds: US$300b?
etc.

As for myself, I think that it does not hurt to put some money into your pockets, especially when there's a "bigger fool" out there that is willing to buy from you, in this "extended" markets.

And if there's any dip later, those Cash should then be redeployed as interest rates are so low.

For next week, I would be watching the following:-
1. OPEC: Dec 1: Probably Non-Event; The Consensus View is that Biden will be regulating the Fracking Industry to death, so Oil should be rising slowly
2. Malaysia: Dec 3: New constituents on Bursa; Would Supermax be added?
3. Malaysia: Round Two of the Budget Vote ?


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (22% from 28% last week from 30% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Worse (91% from 82% from 84%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be pegged)

5. To Reduce Number Of Counters: Progress (23 from 25 from 26)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Glove Makers
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks
Goal: Exposure to 25% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 6 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

5. Inverted Yield: 4 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020

6. Valuation; 8 (Safe 1: 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: 52 out of 70 (74%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$45.53 from US$42.44 last week from US$40.12 two weeks ago;
Support: Resistance: US$29; US$45 (R1); US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1783 from US$1870 from US$1888;
Support: $1240; $1050; Resistance: $1775; $1830;
a. They cant print gold
b. Gold will probably rally after the current physical selling
c. In a crisis (cash crunch), gold will also be sold
d. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Higher; US$3.40 from US$3.29 from US$3.18;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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

1. US Equities - Higher; 3638 from 3558 last week from 3585 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 2820; 2740; 1930 (2016); Resistance: 3385
b. Bought SLV
c. Sold Draftkings

2. HK Equities - Higher. 26895 from 26452 from 26157;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 22000; 21600; 19500; 16800
b. Resistance: 25400; 26800; 28000; 29000; 31600;
c. Sold Alibaba
d. Sold JD.com

3. Shanghai Equities - Higher; 3407 from 3378 from 3310;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3300; 3600
b. No Trade

4. Spore Equities - Higher; 2856 from 2813 from 2711;
Resistance 3850
a. Sold 4/5 Keppel

5. Japan Equities - Higher. 26645 from 25527 from 25386;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance 25000
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Higher; 1608 from 1594 from 1590;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Bought Top Glove


Currencies: Risk-On (Data from XE.com on Nov 27 @ 2.00 PM)

1. USD to JPY - JPY Weaker; 103.92 from 103.83 last week from 104.90 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0430 from 3.0467 from 3.0564;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7378 from 0.7310 from 0.7249;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.1927 from 1.1864 from 1.1824;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Stronger. 7.7511 from 7.7529 from 7.7539;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger. 4.0730 from 4.0921 from 4.1229;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3384 from 1.3431 from 1.3489;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.5812 from 6.5684 from 6.6105;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Stronger; 1.3373 from 1.3268 from 1.3169;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Stronger; 5.4463 from 5.4294 from 5.4292;

11. Dollar Index - USD Weaker; 91.91 from 92.33 from 92.91;
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 0.86% from 0.83% last week from 0.87% two weeks ago

Yield on 2 Year Treasuries - Flat; 0.16% from 0.18% from 0.15%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 107.53 from 107.27 from 106.10;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.27 from 86.08 from 85.15;

Baltic Dry Index - Higher; 1219 from 1134 from 1124; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

[winston]

TOL @ Dec 6, 2020

Warning.jpg

Warning Signs

The markets have been strong and everyone around me is so confident that the markets would continue to go grind higher.

Therefore, it's timely to remind myself of the various warning signs:-
1. The S&P 500 has closed above it's "Monthly Bollinger Band"
2. The "US Put To Call Ratio, 5 Day Average" has slumped to a 20 year low
3. 93% of stocks in the S&P 500 are trading above their 200-day MA
4. The Nasdaq 100 is about two std deviations above its 50-day MA
5. The Schiller's US "Cyclically Adjusted PE Ratio" are back above their peak seen in 1929
6. Treasury Yields continue to march higher
7. The TLT (20 Year+ Treasury Bond Index) is forming a base
8. The VIX is forming a base
9. The Dollar Index is forming a base
10. IPO Mania
11. Strong Participation Of Retail Investors and Inexperienced Newbies
12. Porn Stars are pitching Trading Seminars
13. “Buffett Indicator” (total market value of stocks relative to the overall size of the economy) is at the upper end
14. FOMO and Complacency is the new normal
15. Bitcoin is at historical highs
16. Stretched Valuations eg. PEG
17. Rampant Speculation on Penny Stocks and Derivatives
18. Record number of infection and deaths from Covid19
19. Millions of people would be losing their homes in the coming months
20. High unemployment rate
21. High number of bankruptcies especially the SMEs
22. High number of people in the US are on foodstamps or using food banks
23. Record Global Debt US$277t (365% Global GDP)
24. A Great Wealth Divide is Causing Social Unrest
25. Social Security and Medicare Will be Bankrupt Soon
etc.

Yada yada ... Now that I have frighthened myself, do I Buy, Sell or Hold from here?

Intuitively, I think that this is a "Trading Market". That means that there could be trading opportunities but one must be able to run quickly when the trade does not perform to expectation.

At the same time, I'm quite aware that I could be very wrong and that this bull market can continue to grind higher for a long time to come. And in that case, a "buy & hold" strategy would be the way to go.

However, I do consider "holding a stock" to be equivalent to "buying the stock at the current price" (excluding the discussions on capital gains tax and commissions).

So the only reason that I would hold a stock, is that I'm very confident that it would continue to rise much further, especially after a long run. And trading it would be a waste of time and energy, as I would need to get things correct twice ie. when selling it and then buying it back again at a lower price.

Anyway, before I buy anything nowadays, I would force myself to look at the long term charts first. That's to remind myself of how much that stock has run up over the years.

And if I can accept the run-up, only then would I look at the shorter term charts, to see whether there's any trading opportunity.

In the meantime, the markets continue to grind higher and if I'm buying or holding, it's because I'm hoping that there's a bigger fool out there.

For the coming week, I would be watching the following:-
1. US: Dec 8; Deadline for Resolving US Election Disputes
2. Start of Window Dressing season


Weekly Risk Management Progress Report:-

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (21% from 22% last week from 28% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Progress (86% from 91% from 82%)
Goal: To reduce the percentage of Asian Equities to around 70%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be pegged)

5. To Reduce Number Of Counters: Progress (22 from 23 from 25)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Glove Makers
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks
Goal: Exposure to 25% Value Stocks only


Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 6 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

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

6. Valuation; 8 (Safe 1: 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; Iran;

Total: 52 out of 70 (74%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$46.09 from US$45.53 last week from US$42.44 two weeks ago;
Support: US$29; Resistance: US$77 (2018);
a. Demand is down about 20%?
b. Supply is up about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1842 from US$1783 from US$1870;
Support: 1780; 1700; 1490; 1240; 1050; Resistance: 1890; 1950: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Higher; US$3.53 from US$3.40 from US$3.29;
a. Copper Inventory at LME at 15 year lows
viewtopic.php?f=33&t=5598&p=231237#p231237


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

1. US Equities - Higher; 3699 from 3638 last week from 3558 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3270; 2820; 2740; 1930 (2016); Resistance: 3750
b. Bought Salesforce
b. Sold SLV

2. HK Equities - Higher. 26895 from 26452 from 26157;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 24050; 22000; 21600; 19500; 16800
b. Resistance: 28000; 29000; 31600;
c. Bought Meituan
d. Traded Sino Biopharma
e. Sold ASM Asia Pacific

3. Shanghai Equities - Higher; 3407 from 3378 from 3310;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3600
b. No Trade

4. Spore Equities - Higher; 2856 from 2813 from 2711;
Resistance 3850
a. Sold Keppel
b. Bought Prime Reit

5. Japan Equities - Higher. 26645 from 25527 from 25386;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance; 29 Year High
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Higher; 1608 from 1594 from 1590;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Sold Supermax


Currencies: Risk-On (Data from XE.com on Dec 6 @ 8.00 PM)

1. USD to JPY - JPY Flat; 103.96 from 103.92 last week from 103.83 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0470 from 3.0430 from 3.0467;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7420 from 0.7378 from 0.7310;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger. 1.2166 from 1.1927 from 1.1864;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Strong. 7.7509 from 7.7511 from 7.7529;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger. 4.0602 from 4.0730 from 4.0921;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.3325 from 1.3384 from 1.3431;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.5323 from 6.5812 from 6.5684;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Stronger; 1.3477 from 1.3373 from 1.3268;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Stronger; 5.4728 from 5.4463 from 5.4294;

11. Dollar Index - USD Weaker; 90.58 from 91.91 from 92.33;
a. Expecting the USD to weaken
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 0.93% from 0.86% last week from 0.83% two weeks ago

Yield on 2 Year Treasuries - Flat; 0.16% from 0.16% from 0.18%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 107.83 from 107.53 from 107.27;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.49 from 86.27 from 86.08;

Baltic Dry Index - Higher; 1189 from 1219 from 1134; Low 290; High 2330 (2013)

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

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

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


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:-

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

Support The Forum - 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. The buttom is at the top right hand corner.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

[winston]

TOL @ Dec 13, 2020

Windows Dressing.jpg

Window Dressing

We are touching mid-December and it's Window Dressing season again.

This is when the Fund Managers sell stocks with large losses and buys more of the high-flying stocks, to improve the appearance of the fund’s performance, before presenting it to clients or shareholders.

This is normally a strong period for the stock markets. So if one is trying to time the market, one would normally try to hold the momentum stocks till early January.

The "Santa Claus Rally" also usually starts with the first trading session after Christmas day and ends on the 2nd day of next year.

However, before we run off to buy some stocks, it's timely to be aware that the "CNN Greed & Fear Index" is now at "Extreme Greed". Therefore, one may want to be a bit more careful. That does not mean that the markets will crash tomorrow as "Extreme Greed" can last for a "long period" too.

As for myself, I will try to hold my Momentum Stocks till late December while trying to limit my new purchases. However, it's always easier said than done. Very likely, I would be selling my momentum stocks for small profits in the next week or two and will also probably be continuing my trading.

BTW, Jeffrey Gundlach just mentioned that the FAANGs are losing momentum. But Jeffrey is the "Bond King". I have never heard anyone call him the "Stock King". However, it does not hurt to listen to what he's saying as I do consider the "bond players" to be "sharper" than the "stock players".

For next week, I will be noting the following:-
1. Dec 19: Malaysia - UMNO General Assembly
2. Window Dressing Season


Weekly Risk Management Progress Report:-[b/]

1. To Monitor NET Exposure To Equities (Long Less Shorts):- Safe (24% from 21% last week from 22% two weeks ago, of Liquid Assets)
Goal: 10% exposure to Equities before the next crash; Maximum 40%;

2. To Diversify From Asian Equities: Worse (87% from 86% from 91%)
Goal: To reduce the percentage of Asian Equities to around 60%

3. To Buy Inverse ETFs and Puts before the next crash:-
Current Position:-
a. TZA (Inverse Russell 3x)
b. SOXS (Inverse Semiconductor 3x)
Goal: To have a sizable short position going into the next crash / recession

4. To Increase "USD/HKD/Gold/Silver" - Progress (26% from 25% from 26%).
Goal: To be in the safe havens before next recession; (HKD may be pegged)

5. To Reduce Number Of Counters: Worse (24 from 22 from 23)
Goal: To focus on maximum 16 counters from 4 countries at any one time.

6. To Minimize Industry / Sector Risk / Country Risk
a. Heavy exposure to Asian Based Equities
b. Heavy exposure to Asian Based Currencies
c. Heavy exposure to Glove Makers
d. Heavy exposure to China Tech
Goal: To diversify across various Sectors, Countries and Currencies

7. To diversify from "Value" into "Momentum" stocks
Goal: Exposure to 25% Value Stocks only


[b]Market Risk Indicators

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

2. Credit Problems: 9 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;

3. Recession: 9 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;

4. Liquidity: 6 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;

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

6. Valuation; 8 (Safe 1: 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; Iran;

Total: 52 out of 70 (74%); (Safe: 60%; Danger: 85%)


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

1. WTI Oil - Higher. US$46.55 from US$46.09 last week from US$45.53 two weeks ago;
Support: US$29; Resistance: US$77 (2018);
a. Demand is down about 15%?
b. Supply is also up by about 15%?
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1844 from US$1842 from US$1783;
Support: 1780; 1700; 1490; 1240; 1050; Resistance: 1890; 1950: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Is Silver a better bet due to the current high Gold/Silver ratio?
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Copper - Flat; US$3.53 from US$3.53 from US$3.40;
viewtopic.php?f=33&t=5598&p=231237#p231237


Equities - Risk-Off (Data as of Saturday every week)
CNN Fear & Greed Index: 77 from 85 last week; Extreme Greed

1. US Equities - Lower; 3663 from 3699 last week from 3638 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3270; 2820; 2740; 1930 (2016); Resistance: 3750
b. No Trade

2. HK Equities - Lower. 26506 from 26895 from 26452;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 24050; 22000; 21600; 19500; 16800
b. Resistance: 28000; 29000; 31600;
c. Bought Alibaba
d. Bought JD.com
e. Bought China Mobile

3. Shanghai Equities - Lower; 3347 from 3407 from 3378;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 3600
b. No Trade

4. Spore Equities - Lower; 2822 from 2856 from 2813;
Resistance 3850
a. No Trade

5. Japan Equities - Flat. 26653 from 26645 from 25527;
viewtopic.php?f=10&t=7138&start=200
a. Forward PE 13
b. Support 15575 (2016); Resistance; 29 Year High
c. BOJ owns > Half government bonds and 75% of ETFs
d. Breakeven on BOJ's ETF at 19,500
e. With the stronger Yen, would the Nikkei be correcting?
f. No Trade

6. Malaysian Equities; Higher; 1685 from 1608 from 1594;
viewtopic.php?f=10&t=6292&start=30
a. Short-Selling ban extended to Dec 31, 2020
b. Sold 1/3 Top Glove


Currencies: Risk-Off (Data from XE.com on Dec 11 @ 9.30 PM)

1. USD to JPY - JPY Weaker; 104.13 from 103.96 last week from 103.92 two weeks ago;
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0303 from 3.0470 from 3.0430;
a. Would they devalue the SGD because of the Recession?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7532 from 0.7420 from 0.7378;
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. How will China further retaliate against Australia?
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker. 1.2120 from 1.2166 from 1.1927;
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Strong. 7.7510 from 7.7509 from 7.7511;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. Strong HKD: Money flowing into HK, possibly for the IPOs
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger. 4.0518 from 4.0602 from 4.0730;
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.3371 from 1.3325 from 1.3384;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Weaker; 6.5458 from 6.5323 from 6.5812;
viewtopic.php?f=32&t=7720&start=90

9. GBP to USD:- GBP Weaker; 1.3148 from 1.3477 from 1.3373;
a. Brexit
viewtopic.php?f=32&t=333&start=80

10. GBP to MYR:- GBP Weaker; 5.3269 from 5.4728 from 5.4463;

11. Dollar Index - USD Weaker; 91.02 from 90.58 from 91.91;
a. Expecting the USD to weaken
viewtopic.php?f=32&t=7616&start=60


Properties:-

1. China Properties:-
viewtopic.php?f=10&t=8150&start=140

2. HK Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=7785&start=150

3. Singapore Properties:-
a. How much will it drop and for how long?
b. Will they be removing the property curbs?
viewtopic.php?f=10&t=7750&start=210

4. Malaysian Properties:-
a. How much will it drop and for how long?
viewtopic.php?f=10&t=4220&start=200


Others

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

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

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

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

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

Yield on 10 Year US Treasuries - Lower; 0.89% from 0.93% last week from 0.86% two weeks ago

Yield on 2 Year Treasuries - Lower; 0.13% from 0.16% from 0.16%;

Interest Rates:-
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 108.15 from 107.83 from 107.53;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.77 from 86.49 from 86.27;

Baltic Dry Index - Lower; 1161 from 1189 from 1219; Low 290; High 2330 (2013)

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

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

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


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


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