Winston's Investment Ideas 06 (Aug 22 - Dec 26)

[winston]

TOL @ Dec 25, 2022

winter.jpg

Year-End Blues?

The markets have not gone anywhere for another week (except for HK).

I think that most of the traders are already away for their holidays and volumes are dwindling down. And with the low volumes, it may be possible to manipulate some prices.

However, I'm not too excited with things and will probably be not trading much over the next two weeks. It could be due to the "year-end blues".

Anyway, there's nothing much to be excited about (looks like it's a half-empty glass of water):-
1. US Interest Rates: May remain elevated longer than expected and only drop around Summer / Autumn 2023
2. Inflation: May also remain elevated longer than expected. Supply can take a long time to materialise. Demand Destruction can lead to unintended consequences eg. severe recession, which could lead to QE and Inflation again.
3. Global Economy: Slowing rapidly. Stagflation. How bad will it be?
4. Stock Markets: Too many moving parts?

Having said that, it's also necessary to look at the "half-full part" of that glass of water;-

While everyone is complaining about the tighter liquidity in the markets, from the change in Japan's "yield curve control", higher global interest rates and the US$95b per month Quantitative Tightening, it's interesting to note that we now have the US$1.7t Omnibus Spending.

This US$1.7t Omnibus Spending is on top of the US$2t already announced ie. Student Debt (US$500b), Chips Act (US$280b), PACT Act (US$400b) and Inflation Reduction Act (US$740b).

With the US$3.7t spending spree above, are we that sure that "Market Liquidity" will be that tight in 2023/ 2024? (US$3.7t is quite close to the US$4t that they printed after the Sub-Prime Crisis).

And if "Market Liquidity" is not going to be that tight, then the focus could shift back to economic activities again. (We have been spending too much time on Inflation, Quantitative Tightening and Interest Rates lately).

While the "experts" are predicting weaker Revenue, Earnings and Margins next year, stock prices do have a habit of going up if they can beat expectations. (And the Analysts do have a habit of lowering earnings before the reporting season).

Therefore, things may not be that bad on both the Liquidity and "Earnings" front. As long as we dont get a "Black Swan"event somewhere, we could actually be humming along quite ok next year.

And if the Ukraine War can end sooner than expected, one major risk of the markets would have been removed.

Finally, I would like to take this opportunity to wish you a very "Merry Xmas" and "Happy Holidays"!


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (23% from 21% last week from 21% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 0% (0 Counter); Boring Market
b. HK: 24% (7 Counters); Trading Market
c. US: 45% (6 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 35% (8 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Mixed (Data from Investing.com on Dec 24 @ 6.05 AM)

1. WTI Oil - Higher. US$79 from US$75 last week from US$72 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Flat. US$1806 from US$1803 from US$1809;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and a Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX; Zijin (50% Gold)
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Higher. US$3.81 from US$3.77 from US$3.86;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Vested in Zijin (50% Copper); Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Flat; US$48 from US$48 from US$48;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin: Lower. US$16794 from US$16690 last week from US$17152 two weeks ago @ 6.11 AM on Dec 24, 2022
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$13,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170

Equities - Risk-Off (Data as every Saturday)


CNN Fear & Greed Index - Worse: "39 Fear" from "43 Fear" last week from "Neutral 54" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Lower; 3845 from 3852 last week from 3934 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. Added to Tesla

2. HK Equities - Higher. 19593 from 19451 from 19901;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33500
c. No Trade

3. Shanghai Equities - Lower; 3046 from 3168 from 3207;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)
c. Zero-Covid Policy vs Reopening 1Q 2023
d. Targeted Stimulus Programs
e. No Trade

4. Spore Equities - Higher; 3258 from 3241 from 3246;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 26235 from 27527 from 27901;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Lower; 1475 from 1479 from 1477:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Bought Hartalega
b. Sold Reneuco
c. Traded Hexstar Industries


Currencies: Mixed (Data from XE.com on Dec 23 @ 9.00 PM)

1. USD to JPY - JPY Stronger; 133 from 137 last week from 136 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.28 from 3.26 from 3.26;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Flat; 0.67 from 0.67 from 0.68;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Flat; 1.06 from 1.06 from 1.06;
a. Winter Energy Crisis?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker; 7.8020 from 7.7819 from 7.7890;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Flat; 4.42 from 4.42 from 4.40;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.35 from 1.36 from 1.35;
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 Flat; 6.98 from 6.97 from 6.96;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Weaker; 104.26 from 104.53 from 104.52;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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; 3.75% from 3.49 % from 3.59%;

Yield on 2 Year US Treasuries - Higher; 4.33% from 4.18% from 4.34%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 90.70 from 92.30 from 91.82;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 74.20 from 75.00 from 75.04;

Baltic Dry Index - Higher; 1650 from 1528 from 1385; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=110

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Jan 01, 2023

January.jpg

New Money From The New Month

It's a new month again so new money would be flowing into the markets again. Therefore, there should be a spike in the markets early next week.

Thereafter, I think that markets would continue to rise due to the "January Effect", where the following stocks would be bought:-
1. Stocks sold for year-end Window-Dressing
2. Stocks sold for Tax-Loss Harvesting
3. Penny Stocks (more risk-taking at beginning of year)
4. High-Beta Stocks (more risk-taking at beginning of year)

And in the middle of January, we would be hitting earnings season again. (As mentioned previously, the majority of the companies would be beating expectations as the Analysts have slyly reduced earnings target before the earnings season).

For the Asian markets, I think that they could also be a spike as it's around this time that the employees would be getting their bonuses and some of those money would also be flowing into the market.

I'm starting to be a bit bullish so I need to remind myself to be a bit more cautious as we are not out the woods yet. There are many grey rhinos around and probably some black swans lurking nearby too. I guess the mantra here is "Be cautious but not pessimistic".

My Cash level is safe but I have a very bad habit of using up my Cash quickly, whenever I see an opportunity. In this type of market, I must remind myself to spread out my Cash utilization over a few months. My trading objective remains the same ie. to survive till 2H 2023.

Finally, I would like to take this opportunity to wish you a very "Happy & Prosperous 2023"!


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (28% from 23% last week from 21% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 0% (0 Counter); Boring Market
b. HK: 37% (9 Counters); Trading Market
c. US: 38% (6 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 27% (8 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Mixed (Data from Investing.com on Dec 24 @ 6.05 AM)

1. WTI Oil - Higher. US$80 from US$79 last week from US$75 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1830 from US$1806 from US$1803;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Will money be flowing out of cryptos into gold?
d. Rising Interest Rates and a Rising USD, would not be good for gold
e. Vested in Gold Coins, GDX; Zijin (50% Gold)
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Higher. US$3.82 from US$3.81 from US$3.77;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Vested in Zijin (50% Copper); Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Flat; US$48 from US$48 from US$48;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin: Lower. US$16603 from US$16794 last week from US$16690 two weeks ago @ 7.45 AM on Dec 31, 2022
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$13,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk=On (Data as every Saturday)

CNN Fear & Greed Index - Worse: "37 Fear" from "39 Fear" last week from "43 Fear" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Lower; 3840 from 3845 last week from 3852 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. No trade

2. HK Equities - Higher. 19781 from 19593 from 19451;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33500
c. Bought Bidu
d. Bought JD
e. Bought Meituan
f. Bought Sensetime

3. Shanghai Equities - Higher; 3089 from 3046 from 3168;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs
e. No Trade

4. Spore Equities - Lower; 3251 from 3258 from 3241;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 26095 from 26235 from 27527;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Higher; 1496 from 1475 from 1479:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Sold Hartalega


Currencies: Risk-On (Data from XE.com on Dec 312 @ 10.25 PM)

1. USD to JPY - JPY Stronger; 131 from 133 last week from 137 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Flat; 3.28 from 3.28 from 3.26;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.68 from 0.67 from 0.67;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Higher; 1.07 from 1.06 from 1.06;
a. Winter Energy Crisis?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker; 7.8132 from 7.8020 from 7.7819;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger; 4.40 from 4.42 from 4.42;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.34 from 1.35 from 1.36;
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country where a catastrophe can wipe them out.
c. But Singapore has been managing it's finances well.
viewtopic.php?f=32&t=136&start=100

8. USD to CNY:- CNY Stronger; 6.90 from 6.98 from 6.97;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Weaker; 103.52 from 104.26 from 104.53;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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

Others

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 3.88% from 3.75% from 3.49%;

Yield on 2 Year US Treasuries - Higher; 4.43% from 4.33% from 4.18%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 90.00 from 90.70 from 92.30;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 73.63 from 74.20 from 75.00;

Baltic Dry Index - Lower; 1515 from 1650 from 1528; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=110

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Jan 08, 2023

pessimism.jpg

Pessimism versus Caution

As mentioned last week, I expect the markets to be fairly strong this month.

Therefore, I need to remind myself to not be too influenced by the Pessimists, Permabears and Doom Gurus out there, who are always talking about super-hurricanes, super-earthquakes, super-depression, super-winter, super-stagflation etc.

It's good to be cautious but not be too pessimistic. If one is too pessimistic, one will not be able to see the Opportunities in the Crisis.

Anyway, "Hypergrowth Investing" listed 10 reasons why the stock-market will boom in 2023:-
1. Awful Years Don’t Repeat
2. Falling Inflation = Rising Stock Prices
3. Fed Pauses = Stock Market Booms
4. Valuations Are Discounted
5. The Economy Will Avert a Deep Recession
6. Sentiment Is Too Negative
7. Positioning Is Too Bearish
8. The Bullish 200-Day Crossover
9. Remember that Big 5% Rally Day?
10. Too Many Stocks Are Showing Relative Strength

Having said that, this is not an easy market to maneuver. There are many potholes and moving-parts. And if one is not careful, one could get into a accident.

So one would need to decide whether one wants to sit out this market and earn 4% pa "risk-free" or whether one would like to try to make 4% in a short time, in this type of trading market.

If one chooses the later, the following are some events to watch in 2023, according to Stormwall.com:
1. Inflation Returns
2. The U.S. Economy Enters Recession
3. European Energy Crisis Worsens
4. Oil, Crypto and Gold Perform
5. Continued Rise of Resource Nationalism
6. Traditional Global Alliances Break, New Ones Form
7. U.S. Dollar Dominance Continues to Erode
8. The West, Weary of Cost of Ukraine War, Sues for Peace
9. Domino Effect of Exposure
10. China Barks but Doesn’t Bite at Taiwan
11. Second-Half Rebound in Economy and Markets
12. More of the Same

My position has not changed much. I still think that it is a "Trading Market". Therefore, I must force myself to buy on any steep dips and thereafter, to also force myself to sell on the technical rebound. This is not a "Buy & Forget" market.

At the same time, I must also try to keep a higher level of Cash, in case the slowdown is deeper than expected and lasts longer than expected (into 2025).

For next week, I would be watching:-
1. Jan 12: US CPI Numbers
2. jan 13: Start of US Earnings Season


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (24% from 28% last week from 23% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 0% (0 Counter); Boring Market
b. HK: 23% (7 Counters); Trading Market
c. US: 40% (6 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 34% (10 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Mixed (Data from Investing.com on Jan 7, 2023 @ 6.30 AM)

1. WTI Oil - Lower. US$74 from US$80 last week from US$79 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1871 from US$1830 from US$1806;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Higher. US$3.92 from US$3.82 from US$3.81;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Vested in Zijin (50% Copper); Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Flat; US$48 from US$48 from US$48;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin: Higher. US$16956 from US$16603 last week from US$16794 two weeks ago @ 6.30 AM on Jan 7, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$13,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-On (Data as every Saturday)

CNN Fear & Greed Index - Better: "46 Neutral" from "37 Fear" last week from "39 Fear" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Higher; 3895 from 3840 last week from 3845 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. No trade

2. HK Equities - Higher. 20991 from 19781 from 19593;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33500
c. Bought 2822 (A50 ETF)
d. Sold BIDU
e. Sold JD
f. Sold Zijin
g. Traded Meituan
h. Traded Sensetime

3. Shanghai Equities - Higher; 3158 from 3089 from 3046;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs

4. Spore Equities - Higher; 3275 from 3251 from 3258;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 25974 from 26095 from 26235;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Lower; 1481 from 1496 from 1475:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Bought Reneuco
b. Bought MYEG


Currencies: Risk-Off (Data from XE.com on Jan 6 @ 11.15 AM)

1. USD to JPY - JPY Weaker; 134 from 131 last week from 133 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.27 from 3.28 from 3.28;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Flat; 0.68 from 0.68 from 0.67;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Lower; 1.05 from 1.07 from 1.06;
a. Winter Energy Crisis?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Stronger; 7.8101 from 7.8132 from 7.8020;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Flat; 4.40 from 4.40 from 4.42;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Flat; 1.34 from 1.34 from 1.35;
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; 6.86 from 6.90 from 6.98;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 105.05 from 103.52 from 104.26;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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; 3.71% from 3.88% from 3.75%;

Yield on 2 Year US Treasuries - Higher; 4.46% from 4.43% from 4.33%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 91.12 from 90.00 from 90.70;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 74.47 from 73.63 from 74.20;

Baltic Dry Index - Lower; 1146 from 1515 from 1650; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=110

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Jan 15, 2023

earnings.png

US Earnings Season

It's the start of the "US Earnings Season" and it's likely to be the catalyst for the markets to grind higher.

This is because the analysts would have reduced their earnings target over the past few months, so that the companies can easily beat those earnings expectations.

According to Forbes, the analysts have gone from expecting 3.5% earnings growth (back in September), to the expectation of a 4.1% decline now.

If -4.1% is the actual decline for the quarter, it will mark the first time that the index has reported a year-over-year earnings decline since Q3 2020 (-5.7%).

In addition, "Investor Place" mentioned that Analysts’ earnings per share (EPS) estimates for calendar year (CY) 2023 are finally seeing cuts, too.

The bottom-up EPS estimate for CY 2023 declined by 4.4% (to $230.51 from $241.20) from September 30 to December 31.

For context, over the last 10 years, the average decline in the bottom-up EPS estimate for the next year during the fourth quarter has been only 1.3%. So, this is a substantial cut.

So what does all these means for my trading activities? As mentioned, I think that earnings season are normally good for stocks.

If they beats earnings, the stock price would normally rise. If they dont beat earnings, the stocks would normally tank and that's a good time to pick up some good quality names for the medium term (assuming that it's still fundamentally sound).

Finally, from "Hypergrowth Investing", the “Breakaway Momentum” has now flashed. (This indicator measures the ratio of the total number of advancing stocks to the total number of declining stocks on the NYSE over a 10-day period. When that ratio exceeds 1.97, this signal is triggered).

According to them, the market is about to break out. And when you add in the following reasons, it's time to buy:-
1. Inflation appears to be crashing
2. The Fed may soon end its rate-hiking campaign
3. The Economy has remained surprisingly resilient
4. Tensions from the Russia-Ukraine war are easing
5. China’s reopening

Finally, for the HK market (where I do the bulk of my trading), I will need to be a bit careful. Chinese New Year is coming up and the China traders would be going on leave for a week. (They may not want to be having a big position while they are off on their holidays). Therefore, it's not so good to chase before CNY but should be ok to trade after CNY due to the low volume, which can be easily manipulated.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (29% from 24% last week from 28% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 0% (0 Counter); Boring Market

b. HK: 32% (8 Counters); Trading Market
c. US: 38% (6 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 30% (10 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Risk-On (Data from Investing.com on Jan 7, 2023 @ 6.30 AM)

1. WTI Oil - Higher. US$80 from US$74 last week from US$80 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1923 from US$1871 from US$1830;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Higher. US$4.22 from US$3.92 from US$3.82;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Vested in Zijin (50% Copper); Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Higher; US$50 from US$48 from US$48;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin: Higher. US$20250 from US$16956 last week from US$16603 two weeks ago @ 8.20 AM on Jan 14, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$13,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-On (Data as every Saturday)

CNN Fear & Greed Index - Better: "63 Greed" from "46 Neutral" last week from "37 Fear" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Higher; 3999 from 3895 lazst week from 3840 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. Bought Northrop Grumman

2. HK Equities - Higher. 21739 from 20991 from 19785;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33500
c. Bought 2822 (A50 ETF)
d. Traded Vitasoy
e. Traded CG Services
f. Traded Smoore
g. Traded Yeahka
h. Traded Sensetime

3. Shanghai Equities - Higher; 3195 from 3158 from 3089;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs

4. Spore Equities - Higher; 3294 from 3275 from 3251;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 26120 from 25974 from 26095;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Higher; 1495 from 1481 from 1496:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Bought Inari
b. Bought Reneuco
c. Traded Destini
d. Traded DNEX
e. Sold MYEG


Currencies: Risk-On (Data from XE.com on Jan 13 @ 8.20 PM)

1. USD to JPY - JPY Stronger; 129 from 134 last week from 131 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.28 from 3.27 from 3.28;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.70 from 0.68 from 0.68;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger; 1.08 from 1.05 from 1.07;
a. Winter Energy Crisis?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker; 7.8106 from 7.8101 from 7.8132;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger; 4.34 from 4.40 from 4.40;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.32 from 1.34 from 1.34;
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; 6.72 from 6.86 from 6.90;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Weaker; 102.20 from 105.05 from 103.52;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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; 3.71% from 3.88% from 3.75%;

Yield on 2 Year US Treasuries - Higher; 4.46% from 4.43% from 4.33%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 93.88 from 91.12 from 90.00;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 76.64 from 74.47 from 73.63;

Baltic Dry Index - Lower; 976 from 1146 from 1515; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=110

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Jan 22, 2023

Big picture.jpg

The Big Picture (Update)

It has been a few months since I looked at the "Big Picture" so it's timely to do one again.

1. Interest Rates:- The US government cannot afford to raise interest rates by too much as they have a huge debt to service. Every 100 bps rise in interest rates, will add about US$285b in additional interest payments.

Therefore, Powell's hands are tied but he will continue to try to frighten the market, to manage "inflation expectations".

Things are already slowing down rapidly in the US. I dont think the US economy can take another 1% rise in interest rates this year.

The next FOMC meeting is on Jan 31st and they are now talking of only a 25 bps hike only.

However, interest rates may stay elevated for some time and will probably not drop until there's a severe slowdown. If the US economy does tank in 2Q 2023, then interest rates could drop only in 3Q 2023.

In view of the above, I should try not to spend all my bullets before 1H 2023.

2. Inflation:- Consumer Demand is already dropping. I think that the future CPI and PPI numbers, would show that inflation is dropping as long as the Ukraine War do not get worse from here.

3. USD:- The USD has been quite strong due to the interest rates rise. Once there's a feeling of "Peak Interest Rates", it should weaken from there. I think that it would only occur around 2Q 2023,

4. Commodities:- When the USD drops, Commodities would start to go up assuming that there's no sharp drop in Global Demand. The China Reopening should also lead to more demand for Commodities.

As for Oil, I have a feeling that it may not go up too much from here. The Saudis have upset the US and I think that a plan is already in place to push the Oil Market lower. The US also need to replenish their SPR. In March 2020, Oil did "mysteriously" crash to US$37.

5. Liquidity:- The markets have been fairly liquid and we have not seen any major problem so far. The US$3t Stimulus Spending as well as China's Targeted Stimulus, would keep the global system fairly liquid despite the Fed's Quantitative Tightening.

6. Global Economy:- I'm expecting a mild global recession in the coming months assuming that the Ukraine War do not get worse from here. Please note that my humble view is in contrast with Elon Musk and other "experts", who are expecting the slowdown to last till 2024.

7. Ukraine War:- I'm expecting it to end sooner than later. It's now a matter of finding a way for all parties to "save face". Winter is almost over in Europe and so will be their Energy Crisis for the time being.

8. Market Sentiment:- Overbought on the NYSE, Nasdaq and HK? I'm expecting a correction soon. Depending on how deep it is, it could be a good time to deploy some of the Cash.

9. US Earnings:- People will probably be focusing on the forward guidance to see how bad things will be later in the year.

10. US Market:- Overbought? May need to be a bit careful in the short-term.

11. HK Stock Market:- Overbought? May need to be a bit careful too.

12. Trading Tactic:- I have been buying on any steep drop and trying to sell at the 50% retracement level. I need to remind myself to watch my Cash levels as I need to survive till 2H 2023.

Finally, I would like to take this opportunity to wish those who are celebrating, a very Happy & Prosperous Lunar New Year!


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (32% from 29% last week from 24% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

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

a. Singapore: 0% (0 Counter); Boring Market
b. HK: 27% (9 Counters); Trading Market
c. US: 52% (8 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 21% (8 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Risk-On (Data from Investing.com on Jan 21, 2023 @ 6.50 AM)

1. WTI Oil - Higher. US$81 from US$80 last week from US$74 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Higher. US$1927 from US$1923 from US$1871;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Higher. US$4.24 from US$4.22 from US$3.92;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Vested in Zijin (50% Copper); Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium; Lower; US$49 from US$50 from US$48;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin: Higher. US$22589 from US$20250 last week from US$16956 two weeks ago @ 6,56 AM on Jan 21, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$15,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-On (Data as every Saturday)

CNN Fear & Greed Index - Worse: "59 Greed" from "63 Greed" last week from "46 Neutral" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Lower; 3973 from 3999 last week from 3895 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. Bought Grab

2. HK Equities - Higher. 22045 from 21739 from 20991;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33500
c. Bought Geely
d. Traded Meituan
e. Traded Vitasoy
f. Traded Smoore
g. Traded Yeahka
h. Traded Baidu
i. Sold A50 ETF (2822)

3. Shanghai Equities - Higher; 3265 from 3195 from 3158;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs

4. Spore Equities - Higher; 3295 from 3294 from 3275;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 26554 from 26120 from 25974;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Higher; 1500 from 1495 from 1481:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a, Added to Iris
b. Added to Reneuco
c. Traded DNEX
d. Sold MYEG
e. Sold Inari


Currencies: Risk-Off (Data from XE.com on Jan 20 @ 6.15 PM)

1. USD to JPY - JPY Weaker; 130 from 129 last week from 134 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.24 from 3.28 from 3.27;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.69 from 0.70 from 0.68;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Flat; 1.08 from 1.08 from 1.05;
a. Winter Energy Crisis?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker; 7.8326 from 7.8106 from 7.8101;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger; 4.29 from 4.34 from 4.40;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Flat; 1.32 from 1.32 from 1.34;
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; 6.78 from 6.72 from 6.86;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Weaker; 101.98 from 102.20 from 105.05;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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; 3.48% from 3.71% from 3.88%;

Yield on 2 Year US Treasuries - Lower; 4.18% from 4.46% from 4.43%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 93.15 from 93.88 from 91.12;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 76.02 from 76.64 from 74.47;

Baltic Dry Index - Lower; 801 from 976 from 1146; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=110

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Jan 29, 2023

Trading Break.jpg

Jesse Livermore: There's a time to go long, a time to go short and a time to go fishing.

Trading Break

A few of the Asian markets were closed this week and I took the opportunity to take a trading break and went on a short vacation.

Some traders believed that if their "mental efficiency" drops to less than 90%, they would start to lose money. Therefore, it's always good to take a trading break every few weeks or so.

A trading break also helps one to have a better perspective on things. Sometimes, one is so close to the trees that he cant see the forest.

For next week, we have the FOMC meeting. At this point, the expectations is for a 25 bps rise in interest rates. I think that it will probably be a non-event unless Powell starts talking too much and crash the market.

However, the CNN Greed & Fear Index is now touching 69 and there could also be some skittish traders out there who may sell on the news.


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (25% from 32% last week from 29% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

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

a. Singapore: 0% (0 Counter); Boring Market
b. HK: 18% (6 Counters); Trading Market
c. US: 60% (8 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 21% (8 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Risk-On (Data from Investing.com on Jan 29, 2023 @ 4.30 PM)

1. WTI Oil - Lower. US$79 from US$81 last week from US$80 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Flat. US$1928 from US$1927 from US$1923;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Lower. US$4.23 from US$4.24 from US$4.22;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Vested in Zijin (50% Copper); Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium - Flat; US$50 from US$49 from US$50;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin - Higher. US$23187 from US$22589 from US$20250 @ 4.35 PM on Jan 29, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$15,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-On (Data as every Saturday)

CNN Fear & Greed Index - Better: "69 Greed" from "59 Greed" last week from "63 Greed" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Higher; 4071 from 3973 last week from 3999 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. Sold 1/2 Tesla

2. HK Equities - Higher. 22689 from 22045 from 21739;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33500
c. Sold Geely
d. Sold Vitasoy
e. Sold Sensetime

3. Shanghai Equities - Flat; 3265 from 3265 from 3195;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs

4. Spore Equities - Higher; 3394 from 3295 from 3294;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 27383 from 26554 from 26120;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Lower; 1498 from 1500 from 1495:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a, Sold 2/3 Iris
b. Sold 1/2 Reneuco


Currencies: Risk-On (Data from XE.com on Jan 29 @ 4.45 PM)

1. USD to JPY - JPY Flat; 130 from 130 last week from 129 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.23 from 3.24 from 3.28;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.71 from 0.69 from 0.70;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Stronger; 1.09 from 1.08 from 1.08;
a. Winter Energy Crisis?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Stronger; 7.8297 from 7.8326 from 7.8106;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Stronger; 4.24 from 4.29 from 4.34;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Stronger; 1.31 from 1.32 from 1.32;
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 Flat; 6.78 from 6.78 from 6.72;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Weaker; 101.74 from 101.98 from 102.20;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 3.51% from 3.48% from 3.71%;

Yield on 2 Year US Treasuries - Higher; 4.20% from 4.18% from 4.46%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 93.39 from 93.15 from 93.88;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 76.16 from 76.02 from 76.64;

Baltic Dry Index - Lower; 676 from 801 from 976; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=110

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Feb 5, 2023

Buy-The-Dip.png

Buy The Dips?

The Feds increased interest rates by 25 bps and with that recent move, we now have the Fed at 4.75%. By comparison, the European Central Bank is at 3% while the Bank of England is at 4% (not that the UK matters anymore).

I still think that we are just a few more months to "peak interest rates" for the US. I do not think that they can raise interest rates much from here as the US economy is declining rapidly and the additional interest payments in 2023 of about US$600b will be very painful for them.

If the US economy does tank over the next few months, then it's likely that they will need to reduce interest rates, possibly in 2H 2023. If not, then they can try to keep interest rates elevated till 2024.

At this point in time, it looks like the Feds maybe able to engineer a "soft landing". If that's case, "experts" like Roubini, Dimon etc. would be quite disappointed because they have been trying to sound smart with their apocalyptical predictions.

And if War does end in Ukraine, earlier than expected, then the only major known risk left, would have been eliminated as Covid is no longer an issue.

Anyway, gas prices in Europe have dropped > 80% since August. With that, we've seen three consecutive months of falling prices (month-to-month) in the euro zone. So it's a matter of time until that feeds into the year-over-year inflation number in Europe. At this point in time, it looks like they have managed to overcome their "Energy Crisis" unless Putin decides to do something really "stupid" over the next few weeks.

Although I have been reminding myself to survive till 2H 2023, I must also remind myself to buy the dips. Sometimes, I still hesitate due to the apocalyptical predictions ringing in my ears and in the process, I lose a good trading opportunity. I also need to remind myself that I'm a short term trader so unless my luck is very bad, it's not likely that I would be caught in any super-hurricane as mentioned by Jamie Dimon.

Finally, I have noticed that some of my friends and relatives are tip-toeing back into the markets especially in HK. These are the same people who refused to buy at the bottom because they think that the world is ending and they believed the apocalyptical predictions by the "experts".

After the HK market has gone up 45% in 3 months then they would like to chase now. Their FOMO (Fear Of Missing Out) is so strong now. By the time they are not afraid to buy, prices would have risen by a lot already. Such is human psychology!


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Safe (31% from 25% last week from 32% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

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

a. Singapore: 0% (0 Counter); Boring Market
b. HK: 43% (13 Counters); Trading Market
c. US: 38% (7 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 17% (7 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Mixed (Data from Investing.com on Feb 4, 2023 @ 7.45 AM)

1. WTI Oil - Lower. US$73 from US$79 last week from US$81 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1878 from US$1928 from US$1927;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Lower. US$4.03 from US$4.23 from US$4.24;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium - Higher; US$51 from US$50 from US$49;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin - Higher. US$23456 from US$23187 from US$22589 @ 7.50 AM on Feb 4, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$15,000 (Floor?)
c. US$1.5m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-On (Data as every Saturday)

CNN Fear & Greed Index - Better: "76 Extreme Greed: from "69 Greed" last week from "59 Greed" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Higher; 4136 from 4071 last week from 3973 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. Sold Grab

2. HK Equities - Lower. 21660 from 22689 from 22045;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33
c. Bought CG Services
d. Bought A50 ETF (2822)
e. Bought L'Occitane
f. Traded Vitasoy
g. Traded Sensetime
h. Traded Zhaojin
i. Sold Yeahka

3. Shanghai Equities - Flat; 3263 from 3265 from 3265;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs

4. Spore Equities - Lower; 3384 from 3394 from 3295;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 27383 from 26554 from 26120;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Lower; 1490 from 1498 from 1500:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Traded DNEX


Currencies: Risk-On (Data from XE.com on Feb 4 @ 9.20 AM)

1. USD to JPY - JPY Weaker; 131 from 130 last week from 130 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.22 from 3.23 from 3.24;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.69 from 0.71 from 0.69;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker; 1.08 from 1.09 from 1.08;
a. Winter Energy Crisis?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker; 7.8478 from 7.8297 from 7.8326;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.26 from 4.24 from 4.29;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.32 from 1.31 from 1.32;
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 Flat; 6.78 from 6.78 from 6.78;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 102.82 from 101.74 from 101.98;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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 - Flat; 3.52% from 3.51% from 3.48%;

Yield on 2 Year US Treasuries - Higher; 4.29% from 4.20% from 4.18%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Higher: 93.67 from 93.39 from 93.15;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 76.39 from 76.16 from 76.02;

Baltic Dry Index - Lower; 640 from 676 from 801; Low 290; High 11,400 (2008)


Inflation:-
viewtopic.php?f=16&t=6950&start=110


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


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


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




Please Note:-


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


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


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

[winston]

TOL @ Feb 12, 2023

Buy-The-Dip.png

Buy The Dips (Part 2)

The markets have not gone anywhere for a week but I still think that buying any dips is the correct strategy for the time being, as all known risks seems to be acceptable.

However, there's always a small probability that things can go south for whatever reason including:-
1. Ukraine War Escalation
2. US CPI numbers on Feb 14 that are worse than expectations
3. Bird Flu Situation worsening
4, Catastrophic Natural Disaster
etc.

In view of the above, I need to constantly remind myself to be a bit careful as I still need to survive another 5 months till 2H 2023 and I have a very bad habit of wanting to deploy my Cash whenever I'm sitting on a lot of Cash.

Over the past two weeks, I have increased my exposure to Equities from 25% of Liquid Assets, to about 45% now. This is a good exposure to Equities (a bit too much though) and I should slow down my purchases from here unless there's a convincing trading opportunity.

By the way, "Daily Wealth" had a recent article titled, "The New US Bull Market Is Here. Don’t Miss It" and the following is a summary:-
1. Despite the market’s seeming downtrend, most stocks have stopped falling.
2. The S&P 500 and the Advance/Decline line bottomed at the same time in October before rallying together into November. And then, in January, they diverged.
3. The January stock rally failed to break above the November high. But the Advance/Decline line did the opposite and blasted through its November highs.
4. More stocks are going higher than lower. And that means a major rally is likely on the way.

And if one is very confident after reading the above article, the following is another article from "Stansberry Research", the sister company of "Daily Wealth". It mentioned that a number of strange events are starting to play out all dthe US including:-
1. 50% of US employers expect to lay workers off in the coming weeks
2. 20 million American households are behind on their utility bills
3. $13.5 trillion in American wealth has evaporated, as stocks and real estate prices have fallen
4. Food prices continue to rise , even vegetables up over 80% in the past year

Therefore, it's good to remind myself that for every transaction, there's always a buyer and a seller. So why are they buying and why are they selling? Who has the better information? Who has analyzed the situation better?


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Neutral (44% from 31% last week from 25% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 0% (0 Counter); Boring Market
b. HK: 45% (15 Counters); Trading Market
c. US: 35% (8 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 20% (8 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Mixed (Data from Investing.com on Feb 4, 2023 @ 7.45 AM)

1. WTI Oil - Higher. US$80 from US$73 last week from US$79 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Will Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
h. Russia to curt 500,000 bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1877 from US$1878 from US$1928;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Lower. US$4.02 from US$4.03 from US$4.23;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium - Flat; US$51 from US$51 from US$50;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin - Lower. US$21782 from US$23456 from US$23187 @ 9.35 PM on Feb 10, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$15,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as every Saturday)

CNN Fear & Greed Index - Weaker: "70 Greed" from "76 Extreme Greed" last week from "69 Greed" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Lower; 4090 from 4136 last week from 4071 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: PE 22; Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. Bought Alphabet
g. Traded Grab
h. Sold Northrop Grumman

2. HK Equities - Lower. 21190 from 21660 from 22689;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33
c. Added to CG Services
d. Added to JD
e. Added to Meituan
f. Added to Suzhou Basecare
g. Bought Sensetime
h. Bought Geely
i. Traded Baidu
j. Sold Tencent

3. Shanghai Equities - Flat; 3261 from 3263 from 3265;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs

4. Spore Equities - Lower; 3361 from 3384 from 3394;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 27671 from 27383 from 26554;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Lower; 1475 from 1490 from 1498:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Bought DNEX
b. Bought Citaglobal
c. Traded MYEG
d. Sold iris


Currencies: Risk-Off (Data from XE.com on Feb 10 @ 9.12 PM)

1. USD to JPY - JPY Weaker; 131 from 130 last week from 130 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.26 from 3.22 from 3.23;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Flat; 0.69 from 0.69 from 0.71;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker; 1.07 from 1.08 from 1.09;
a. Winter Energy Crisis?
b. Russia escalating Ukraine War?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker; 7.8500 from 7.8478 from 7.8297;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.33 from 4.26 from 4.24;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.33 from 1.32 from 1.31;
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; 6.81 from 6.78 from 6.78;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 103.33 from 102.82 from 101.74;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 3.74% from 3.52% from 3.51%;

Yield on 2 Year US Treasuries - Higher; 4.52% from 4.29% from 4.20%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 92.45 from 93.67 from 93.39;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 75.36 from 76.39 from 76.16;

Baltic Dry Index - Lower; 592 from 640 from 676; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=11

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Feb 18, 2023

buy the dips.png

Buy The Dips (Part 3)

The markets have been fairly weak this week. However, HK was a bit volatile and there were some trading opportunities. I did managed to sell some HK shares on the Rip and then bought some of them back on the Dip.

Going forward, I think that it could be a "water torture" ie, slowing dripping downwards until a strong catalyst appears. Therefore, I need to remind myself to conserve some of my Cash.

On the interest rates front, the consensus now is that the next interest rates hike will be 50 bps. It's not the end of the world but it is a bit higher than the 25 bps that was expected not too long ago. When will the markets move it's focus on interest rates to Revenue / Earnings?

Anyway, if you are feeling a bit bullish then you have the following on your side:-
Going back to 1950, there has never been a 12-month period, following a midterm election, in which stocks were down. And the average one-year return following the eighteen midterm elections of the past seventy years was 15% (about double the long-term average return of the S&P 500).

If you are wondering where are the opportunities, the following are six snow leopards by "The Atlantic Council":-
1. Tightening algorithm regulation
2. Corporations distancing themselves from China
3. The battery revolution democratizing electric vehicles
4. A labor movement driven by online-platform workers
5. The potential of geo-engineering
6. Improving relations between Japan and South Korea

And if you are feeling very bullish, then you may want to note that CNBC mentioned that about 63% of Americans are living paycheck to paycheck, including nearly half of six-figure earners.

Finally, you may be wondering why this Blog is being sent out on a Saturday and not my usual Sunday. It's because I will be going away today for a short trip today and will only be back on late Sunday.

Have a good weekend!


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Neutral (41% from 44% last week from 31% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 0% (0 Counter); Boring Market
b. HK: 45% (15 Counters); Trading Market
c. US: 35% (8 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 20% (8 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Mixed (Data from Investing.com on Feb 18, 2023 @ 6.10 AM)

1. WTI Oil - Lower. US$76 from US$80 last week from US$73 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Will Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
h. Russia to curt 500,000 bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1851 from US$1877 from US$1878;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

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

4. Copper - Higher. US$4.13 from US$4.02 from US$4.03;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium - Higher; US$52 from US$51 from US$51;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin - Lower. US$23820 from US$21782 from US$23456 @ 8.17 PM on Feb 17, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$15,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as every Saturday)

CNN Fear & Greed Index - Weaker: "69 Greed" from "70 Greed" last week from "76 Extreme Greed" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Lower; 4079 from 4090 last week from 4136 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: PE 22; Forward PE 17
c. S&P 500 CAPE Ratio; Current = 28; Sept 1929 = 33; Dec 1999 = 44
d. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
e. Nasdaq Forward PE 21;
f. Sold Lyft
g. Sold Grab

2. HK Equities - Lower. 20720 from 21190 from 21660;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33
c. Traded Baidu
d. Traded Tencent
e. Traded Techtronic
f. Traded Vitasoy
g. Traded China Overseas Land
h. Traded Sensetime
i. Sold 1/2 CG Services
j. Sold 1/2 JD
k. Sold 1/2 L'Occitane

3. Shanghai Equities -Lower; 3224 from 3261 from 3263;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. How bad is the Covid situation in China?
d. Targeted Stimulus Programs

4. Spore Equities - Lower; 3328 from 3361 from 3384;
Resistance 3850
a. No Trade

5. Japan Equities - Higher; 27513 from 27671 from 27383;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Higher; 1477 from 1475 from 1490:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Added to DNEX
b. Added to Destini
c. Bought MYEG


Currencies: Risk-Off (Data from XE.com on Feb 17 @ 8.40 PM)

1. USD to JPY - JPY Weaker; 135 from 131 last week from 130 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.31 from 3.26 from 3.22;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
c. Converted some SGD to MYR
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.68 from 0.69 from 0.69;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Weaker; 1.06 from 1.07 from 1.08;
a. Winter Energy Crisis?
b. Russia escalating Ukraine War?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Stronger; 7.8446 from 7.8500 from 7.8478;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.43 from 4.33 from 4.26;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.34 from 1.33 from 1.32;
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; 6.88 from 6.81 from 6.78;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 104.51 from 103.33 from 102.82;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 3.74% from 3.52% from 3.51%;

Yield on 2 Year US Treasuries - Higher; 4.52% from 4.29% from 4.20%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 91.08 from 92.45 from 93.67;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 74.27 from 75.36 from 76.39;

Baltic Dry Index - Lower; 530 from 592 from 640; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=11

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

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

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


Please Note:-

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

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

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

[winston]

TOL @ Feb 26, 2023

Water Torture.jpg

Water Torture?

The markets have been weak and as mentioned last Saturday, I think that it will be a "Water Torture" for the time being until a new catalyst emerges (hopefully, the end of the Ukraine War).

In the meantime, the "experts" are still continuing to talk about the end of the world and "higher and longer" on the interest rates front.

Frankly, I'm surprised that these "experts" are still focussing on "Inflation & Interest Rates" instead of "Revenue and Earnings".

IMHO, the interest rates hike are already hurting and it will eventually show up in the statistics eg. CPI, PPI and PCE. There's no more need to be so "kiasu" in the monitoring of those inflation statistics.

Instead, we should now be monitoring the "Revenue and Earnings". What's the damage and how are the companies navigating the minefield?

For this week, we have a few more "warning signs":-
1. Home Depot & Walmart: growing consumer weakness
2. Moody Analytics: Some 9.3% of auto loans extended to people with low credit scores, were 30 or more days behind on payments at the end of last year, the highest share since 2010
3. Fortune: Nearly 65% of Americans are living paycheck to paycheck as they lean on savings and credit cards to make ends meet

While it's very easy to be pessimistic because you are surrounded by so many "bearish experts", I think that it's better to be "cautiously bullish" and use this dip to monitor / pick up some "world class companies", for the "medium term". When you are no longer afraid, prices would have probably doubled or tripled.

And if you are still "bearish", you may want to note the following from "Investor Place":-
1. Every bear market of the past 73 years ended when the S&P 500 retook and held its 200-day moving average for at least 18 days.
2. Whenever this phenomenon has occurred, the market always rallied over the next three, six, and 12 months, with average 12-month returns of about 20%.
3. In other words, while it may seem like the recent rally is rolling over and we are falling back into a bear market, history suggests otherwise.
4. The fact that the market broke above and held its 200-day moving average for more than 20 days is critical. The stock market has only done that 11 times before. Each time, stocks were higher three, six, and 12 months later.
5. That’s why we believe the recent stock selloff offers an attractive opportunity to buy the dip before the next leg higher in this new bull market breakout.

But before you go off to buy, you may want to note that the support on the S&P 500 is about 3900. (It's now 3970). All the chartists would be watching this level. If it breaks through this level convincingly, then the markets would probably drop further.

In addition, on a historical basis, according Ino.com, the S&P 500 is looking expensive;-
1. The S&P 500 currently trades at a PE of 21. Looking back to the 1870s, the mean PE ratio is 16 and the median is 15. So, we are on the higher end of the average.
2. The S&P 500 is also trading at a 4 Price-to-Book ratio. Looking back to 2000, the mean is 3 and the median is 2.81. Again, we are on the higher end.
3. The S&P 500 Price-to-Sales ratio is currently at 2.33. The mean going back to 2000 is 1.68, while the median is 1.54. Once again, we are sitting on the higher end.

Finally, I would be watching the following for next week:-
1. New Money From The New Month - expecting a spike next week
2. March 5 - China: National People's Congress; Targeted Stimulus


Weekly Risk Management Progress Report:-

1. To Monitor "Net Exposure" To Equities (Long Less Shorts):- Neutral (45% from 41% last week from 44% two weeks ago, of Liquid Assets)
Goal: 15% exposure to Equities before the next crash; Maximum 60%;

2. To Diversify Across Countries; Goal: Maximum 20 Counters (Not Easy)
a. Singapore: 0% (0 Counter); Boring Market
b. HK: 45% (18 Counters); Trading Market
c. US: 32% (8 Counters); Large Caps & ETFs @ Time Difference Risk
d. Malaysia: 22% (10 Counters); Special Situations
Goal: To ensure that my portfolio is not too concentrated in any country.

3. To Increase "USD/HKD/Gold/Silver" from around the current 25%
Goal: To be in the "safe havens" before next recession; (HKD may be repegged)

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


Commodities: Mixed (Data from Investing.com on Feb 18, 2023 @ 6.10 AM)

1. WTI Oil - Higher. US$77 from US$76 kast week from US$80 two weeks ago;
Support: US$72; US$62, US$29; Resistance: US$126;
a. What's the global demand destruction? 10%? 10m bpd?
b. Saudi Instability? King Salman is 86 years old
c. When will Iranian Oil (4m bpd) be available?
d. Russia produced about 11m bpd. About 4m of Supply could be affected.
e. SPR release: Released 25% (160 m barrels); 390m barrels left; Will replenish at US$67 to US$72?
f. Will Venezuela Sanctions to be lifted?
g. OPEC+ to cut 2m bpd
h. Russia to curt 500,000 bpd
viewtopic.php?f=33&t=9249&p=231235#p231235

2. Gold - Lower. US$1818 from US$1851 from US$1877;
Support: 1490; 1240; 1050; Resistance: 2015; 2070;
a. They cant print gold
b. In a crisis (cash crunch), gold will also be sold
c. Rising Interest Rates and a Rising USD, would not be good for gold
d. Vested in Gold Coins, GDX;
viewtopic.php?f=33&t=8845&p=231236#p231236

3. Silver - Lower; US$21 from US$22 from US$22;
a. Attractive "Silver to Gold" ratio
b. Industrial Demand eg. Solar
c. Vested in SLV
viewtopic.php?f=33&t=10086&start=80

4. Copper - Lower. US$3.96 from US$4.13 from US$4.02;
Support: 3.08; 2.25; Resistance: 4.75;
a. Slight oversupply for a few years?
b. 14 years for operational new mine
c. Monitoring COPX
viewtopic.php?f=33&t=5598&p=231237#p231237

5. Uranium - Flat; US$52 from US$52 from US$51;
Support: 14 (2016); Resistance: 53; 73 (2011); 140 (2007);
a. Kazatomprom, world's largest, to keep production flat in 2022 & 2023.
b. Droughts in Europe affecting Nuclear Energy generation?
c. If Oil and Natural Gas drops, how would that affect Uranium?

6. Bitcoin - Lower. US$23084 from US$23820 last week from US$21782 two weeks ago @ 5.55 AM on Feb 25, 2023
a. Record: $69,000 Nov 2021; Support: $8300;
b. Cost of Mining Bitcoin: US$15,000 (Floor?)
c. US$1m Target by Cathie Woods by 2030
d. Demand from Russia-Ukraine War, Iranian Sanction, Venezuela Sanction;
e. Not vested
viewtopic.php?f=16&t=6175&start=170


Equities - Risk-Off (Data as every Saturday)

CNN Fear & Greed Index - Weaker: "59 Greed: from "69 Greed" last week from "70 Greed" two weeks ago.
viewtopic.php?f=16&t=9099&start=90

1. US Equities - Lower; 3970 from 4079 last week from 4090 two weeks ago;
viewtopic.php?f=11&t=7643&start=200
a. Support: 3900; 3400; 2800; 2237 (2020); 1930 (2016); Resistance: 4375; 4750;
b. S&P 500: PE 21; Forward PE 17; Average 16
c. Buffett Indicator: U.S. Equity Market Cap / GDP = 151; >140 is Expensive
d. Nasdaq PE 20; Forward PE 23;
e. Bought Grab

2. HK Equities - Lower. 20010 from 20720 from 21190;
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120
a. Support: 18500; 17,000; 13300; 8600
b. Resistance: 22470; 31200; 33
c. Added to Baidu
d. Added to JD
e. Bought Techtronic
f. Bought CR Holdings
g. Traded New World
h. Traded Sensetime

3. Shanghai Equities - Higher; 3267 from 3224 from 3261;
viewtopic.php?f=10&t=7190&start=210
a. Support: 2450; Resistance 4600
b. Vested 3188 (CSI 300 ETF) & 2822 (A50 ETF)
c. Targeted Stimulus Programs

4. Spore Equities - Lower; 3282 from 3328 from 3361;
Resistance 3850
a. No Trade

5. Japan Equities - Lower; 27453 from 27513 from 27671;
viewtopic.php?f=10&t=7138&start=200
a. Support 15575 (2016); Resistance 30715
b. BOJ owns > Half government bonds and 75% of ETFs
c. Breakeven on BOJ's ETF at 19,500
d. Not vested

6. Malaysian Equities: Lower; 1457 from 1477 from 1475:
https//investideas.net/forum/viewtopic.php?f=10&t=6292&start=30
a. Added to Citaglobal
b. Bought DRB Hicom
c. Bought Gamuda
d. Bought Petra Energy
e. Traded DNEX
f. Traded Destini
g. Sold MYEG


Currencies: Risk-Off (Data from XE.com on Feb 25 @ 6.15 AM)

1. USD to JPY - JPY Weaker; 136 from 135 last week from 131 two weeks ago
a. Range is 76 to 151
b. Aging Population
c. High Debt Ratio
d. Unlimited QE
e. Monitoring FXY
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.28 from 3.31 from 3.26;
a. Would they devalue the SGD because of the slowdown?
b. How would the reopening affect the exchange rate?
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Flat; 0.67 from 0.67 from 0.68;
a. Range: 0.66 to 1.10 (2011)
b. Commodity Currency
viewtopic.php?f=32&t=5256&start=130

4. EUR to USD - EUR Flat; 1.06 from 1.06 from 1.07;
a. Winter Energy Crisis?
b. Russia escalating Ukraine War?
viewtopic.php?f=32&t=5523&start=100

5. USD to HKD - HKD Weaker; 7.8496 from 7.8446 from 7.8500;
a. USD Peg band: 7.75 to 7.85
b. When will they be removing the peg to the USD?
c. No Hot IPO
viewtopic.php?f=32&t=3529&start=40

6. USD to MYR:- MYR Weaker; 4.44 from 4.43 from 4.33;
a. 52 Week Range is 3.27 to 4.75
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9

7. USD to SGD:- SGD Weaker; 1.35 from 1.34 from 1.33;
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; 6.96 from 6.88 from 6.81;
viewtopic.php?f=32&t=7720&start=90

9. Dollar Index - USD Stronger; 105.19 from 104.51 from 103.33;
viewtopic.php?f=32&t=7616&start=60


Properties:-

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

2. HK Properties:-
a. GS: To drop by 25% by end 2023
viewtopic.php?f=10&t=7785&start=150

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

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


Others

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

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

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

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

Yield on 10 Year US Treasuries - Higher; 3.95% from 3.74% from 3.52%;

Yield on 2 Year US Treasuries - Higher; 4.81% from 4.52% from 4.29%;

Interest Rates:-
a. 2/10 Inverted; Recession Indicator
viewtopic.php?f=16&t=7319&p=221670#p221670

JNK (SPDR Barclays High Yield Bond ETF) - Lower: 90.98 from 91.08 from 92.45;

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 74.17 from 74.27 from 75.36;

Baltic Dry Index - Lower; 816 from 530 from 592; Low 290; High 11,400 (2008)

Inflation:-
viewtopic.php?f=16&t=6950&start=11

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

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

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


Please Note:-

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

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

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