(Bull) Market Feb. 2021

[qldfrog]

Back to Mr duc thread, I keep some vague interests on the french situation and there are a few articles lately about actual rising cost of life (aka inflation)
So crisis, people do not spend but: power, gas, petrol, everything but for the items you can not shop for (clothes etc) are going higher and higher 1.5% to 2 % annual increase.
Salaries are obviously not going up but for the Public servants..and welfare..which is probably most of French peoples

 

[Warr87]

I understand (a bit) jumping on the wagon but at the very least be realistic and once it started plunging, it was really a case of get the Fxx out ASAP.you could hang onto Afterpay or even Tesla after a crash, but that was really a play against the short so with an expiring date even if it worked..which it did in a way, then the funds got the final laugh on the late (re) tarded suckers jumping onto what was just a wagon to oblivion
Not sure if we should laugh or cry.The enthousiasm and stupidity of youth I think
View attachment 119757
Not a good sign for the so called background in finance, am I the only one to have a smile when my eye caught this?

We knew it was a short-time play, but I guess you have to understand that not everyone knows what exactly that means. I think even amateur savvy invsetors would have been in and out. hate to see people lose large sums of money though!

 

[samuilk]

would like to see your current holdings

 

[Warr87]

would like to see your current holdings

mine?

 

[ducati916]

With (after-the-fact) concern about order flow:

And Hedge Funds that had a bad January:

The overall market currently:

The BIG news on BTC:

Now that is interesting.

Mr flippe-floppe-flye is a participant in both trading and investing in crypto.

They are not for me. The article on the Tether issues will keep me out of this market.

Meanwhile Gold is ready to bounce:

The 10yr (on its way to 1.3% and potentially 2%) will consolidate while its 50EMA catches up. Which means that gold can bounce higher. The 10yr is the focal point of a massive carry trade: sell 10yr buy stocks (S&P500). Obviously the Fed. is the buyer of the 10yr, who else wants a yield of 1% and change? Pretty much no-one. The question is how high will they let it go before stamping on this trade? Paradoxically, if they (Fed.) yield curve manage, then the carry trade actually explodes and the market will move much higher. Obviously this is not a trade retail can (easily join) profit from as the funds from short sales cannot be used in long purchases.

The issue will be in 'unwinds'.

The second issue is the DXY. Firmly in a downtrend, but currently experiencing a bounce. Yellen has said that the DXY will be left to 'market forces'. This is a change from 'strong dollar' policy wording. Biden wants US manufacturing to pick up: a weak dollar helps exports. A weak DXY is 'inflationary' to PPI. Energy costs escalate. Do Tech. firms (to power their server farms) feel higher energy costs in the same way that the previous economy did?

jog on
duc

 

[samuilk]

mine?

Yes and ducati's

 

[Warr87]

Weekly Portfolio - ASX

Other updates: Happycat is at +9.4% My super account is doing good too and already recovered losses from last week. CFD trading This has been the star of the week. It was being hammered the last 2 weeks. It finally caught a BO on ETH that also broke out numerous times recently. This trade...

www.aussiestockforums.com

 

[ducati916]

So a very busy week at work restricted my ability to update. No matter, the market continued to drift higher.

On bubbles:

On Robinhood signups:

On TSLA buying BTC:

On the GME type of BS:

On POT stocks:

On the week:

On NG:

On Gold Miners:

On the VIX:

NG is moving higher on the fundamentals. Reduced storage, increased demand out of primarily China. As always with NG, the weather is the wild card. ATM, it is colder than predicted. If it gets warmer, no doubt the bears will return. That being said, the lack of supply may trump the weather in any case. Certainly the bears have been trying to push prices down...

Gold Miners are looking to move higher based again on the fundamentals, ie., higher average POG. Gold itself is struggling as the 10yr keeps moving higher (yields).

Yields are now indicating 1.4% (up from my 1.3% indication).

VIX is again at a strong support level. For the market, VIX needs to break lower. While it may do so, it is unlikely to do so in a big way. The greater risk is a (further) break (spike) to the upside. The reason is that energy again leads the market this week. PPI inflation is bad for the market as it increases the move in the 10yr.

From Mr flippe-floppe-flye:

An interesting read:

How sneakerheads ruined online shopping

Why shopping — for everything from the PS5 to the Nugget couch — got so competitive.

www.vox.com

jog on
duc

 

[ducati916]

Yes and ducati's

Essentially any ETF that has both a long and short component. Those that have leverage x3/x2 are preferred to those that are simply x1. The reason is that I play a market neutral game.

jog on
duc

 

[qldfrog]

Essentially any ETF that has both a long and short component. Those that have leverage x3/x2 are preferred to those that are simply x1. The reason is that I play a market neutral game.

jog on
duc

And as discussed elsewhere: hard to do on asx only bboz and bear are short available ETFs here..so definitively a US play

 

[ducati916]

The bull market remains in place:

All of the below, should turn upwards in a bear market.

Europe looking to break out.

As are Emerging markets:

Most importantly for the US, Financials are moving (although this is a very select sort of financial). The reason financials are doing well is due to the steepness of the yield curve. It has to be said that European financials are f***ed, an absolute cesspit. US financials require some caution also.

IPO's contain plenty of SPACS. Many of these are destined to end horribly. But not today.

Mr flippe-floppe-flye

The SPY: the red box is the 'reversal' box.

BTC: Below the 20 is obviously an issue. The Blue is the 5.

Gold: the green box is the reversal box. Red is the 5, Purple is the 20. Gold looks to be finding support at the 20, but confirmation is if it passes through the reversal.

Another view: the 10yr looks bullish, which generally spells lower prices for gold. I'm (guessing) that the gold chart above, will fail and gold will fall below the 20, which previously supported it. If 'gold' moves higher, it is potentially in the gold miners as opposed to gold itself.

Overall, the bulls remain firmly in control. We are definitely in 'buy-the-dip' territory, as of course there will be dips along the way. Inflation while picking up, is not yet an issue for the market.

Scenario 1.

Inflation (will likely) continue, yields will continue to rise and at some point (somewhere between 2% & 3%) the market will falter. There could start to be defaults on debt loads. This is deflationary. For the Fed, this is a far bigger issue than inflation.

Scenario 2.

Inflation will continue, rates will rise, the Fed. will cap rates. Gold will come back in a big way, stocks will continue higher for a time and currencies will become a big market issue.

jog on
duc

 

[qldfrog]

The bull market remains in place:

All of the below, should turn upwards in a bear market.

View attachment 120024

Europe looking to break out.

View attachment 120025

As are Emerging markets:

View attachment 120026

Most importantly for the US, Financials are moving (although this is a very select sort of financial). The reason financials are doing well is due to the steepness of the yield curve. It has to be said that European financials are f***ed, an absolute cesspit. US financials require some caution also.

View attachment 120027

IPO's contain plenty of SPACS. Many of these are destined to end horribly. But not today.

View attachment 120028

Mr flippe-floppe-flye

View attachment 120029View attachment 120030

The SPY: the red box is the 'reversal' box.

View attachment 120031

BTC: Below the 20 is obviously an issue. The Blue is the 5.

View attachment 120032


Gold: the green box is the reversal box. Red is the 5, Purple is the 20. Gold looks to be finding support at the 20, but confirmation is if it passes through the reversal.

View attachment 120033

Another view: the 10yr looks bullish, which generally spells lower prices for gold. I'm (guessing) that the gold chart above, will fail and gold will fall below the 20, which previously supported it. If 'gold' moves higher, it is potentially in the gold miners as opposed to gold itself.

View attachment 120034


Overall, the bulls remain firmly in control. We are definitely in 'buy-the-dip' territory, as of course there will be dips along the way. Inflation while picking up, is not yet an issue for the market.

Scenario 1.

Inflation (will likely) continue, yields will continue to rise and at some point (somewhere between 2% & 3%) the market will falter. There could start to be defaults on debt loads. This is deflationary. For the Fed, this is a far bigger issue than inflation.

Scenario 2.

Inflation will continue, rates will rise, the Fed. will cap rates. Gold will come back in a big way, stocks will continue higher for a time and currencies will become a big market issue.

jog on
duc

Great analysis as always but i found these charts style just unreadable. :-(
It conveys souvenirs of 1980 dot matrix print out , hand written math fct graphs on log papers.
in all the due respect i genuinely have for you Mr Duc, can you get visual clues, read from these?
Is it just me?

 

[ducati916]

Great analysis as always but i found these charts style just unreadable. :-(
It conveys souvenirs of 1980 dot matrix print out , hand written math fct graphs on log papers.
in all the due respect i genuinely have for you Mr Duc, can you get visual clues, read from these?
Is it just me?

Monsieur Grenouille,

Attached below are the 4 charts of the same thing: they all depict the same information, but appear visually different. We (traders) are pattern recognition machines, but imperfect. We have any number of inbuilt biases that distort our perception of reality: we see what we want to see.

By looking at the same information in visually different ways, we at least increase the chance that we will pierce the shroud of our own bias and see more clearly.

Clearly (to me) are the 3 support areas, which then broke higher for for TNX:GLD. The last (circled) was about as bullish a pattern on the P&F that you will ever see. P&F charts also, via the Wyckoff method, give pretty good price predictions (where 1.3% comes from) moving into the future.

Some will say, you can see all of the above by just looking at 1 chart. Possibly. I like confirmation. I also like divergences (very much) as it is in the divergences that many make errors of bias.

jog on
duc

 

[ducati916]

Inflation:

Inflation currently, is only a financial markets thing. Your average person can't even spell inflation currently:

For the markets and those active in the markets, yes, inflation, or at least the fear of it is currently a thing. Opposing it however is the polar opposite, deflation. Sitting in the middle are disinflationary forces, acting against outright inflation.

The 2 forces will be: (a) interest rates and (b) DXY

DXY is currently in a massive support zone. The green box indicates a potential move higher. If support breaks, well next stop 80/79. If that Gold/Silver will be already screaming higher.

Paradoxically, gold seemingly, seems to be headed lower. This is the dichotomy in the markets currently and why there are so many completely disparate opinions.

The 'market' seems to be saying: the DXY will find support and head higher: therefore gold lower. Possible. Watch this space.

jog on
duc

 

[samuilk]

Essentially any ETF that has both a long and short component. Those that have leverage x3/x2 are preferred to those that are simply x1. The reason is that I play a market neutral game.

jog on
duc

I am invested into VGS, international market ETF from vanguard. My goal is for early retirement, thoughts?
I have some small holdings in other companies, but majority of my position is with VGS

 

[ducati916]

Oil news:

Friday, February 12th, 2021

Brent held above $61 per barrel in early trading on Friday, despite some headwinds from a slight strengthening of the dollar. Analysts are now split on whether or not the rally has gone too far or has more room to run.

OPEC cuts oil demand forecast. OPEC expects oil demand to rise by 5.8 million barrels per day (bpd) this year, down by around 100,000 bpd from last month’s projection due to lockdowns in major developed economies in the first half of this year, the cartel said on Thursday.

EIA: U.S. shale to grow. The EIA said that with WTI over $50, U.S. shale will return to growth later this year. The agency increased its 2022 supply forecast to 11.53 mb/d, up from 11.49 mb/d last month.

S&P cuts credit rating for ExxonMobil. S&P cut ExxonMobil’s (NYSE: XOM) credit rating by one notch to AA- with a negative outlook. The ratings agency cited heavy levels of debt and energy transition risk.

Exxon to close its Australian refinery. ExxonMobil (NYSE: XOM) said it would close its 72-year-old Altona refinery in Australia, the nation’s smallest. Once closed, Australia will only have two remaining refineries.

Goldman: Upside risk to $65 oil. A broad commodity supercycle is getting underway, creating upside risk to $65 oil, according to Goldman Sachs. “I want to be long oil and hang on for the ride,” Goldman’s Jeff Currie said in an interview with S&P Global Platts on Feb. 5, warning “there is a lot of upside here.” He added: “Is it back to $150/b? I don't know... as it is a macro repricing we are talking about and everything needs to reprice.”

Equinor sells of Bakken assets. Equinor (NYSE: EQNR) announced the sale of its Bakken assets for $900 million, after purchasing them for $4.4 billion nearly a decade ago. “We should not have made these investments,” Equinor Chief Executive Officer Anders Opedal said. “The Bakken does not compete.”

Appalachian fracking boom didn’t lead to prosperity. A new report from the Ohio River Valley Institute finds that despite a natural gas boom over the past decade, the counties in Appalachia that saw the most drilling actually saw worse job growth than elsewhere. The conclusions undercut the notion that the shale gas industry is a job engine.

Oil majors trim shale dreams. ExxonMobil (NYSE: XOM), Chevron (NYSE: CVX), and BP (NYSE: BP) have collectively shelved as much as 2.4 mb/d in future oil production plans from U.S. shale, according to an analysis from Energy Intelligence. The strategy overhaul means the majors will focus on cash generation rather than production growth. Excess cash flow will go to paying down debt or otherwise be returned to shareholders.

Shell says its production already peaked. Royal Dutch Shell (NYSE: RDS.A) said it would start reducing oil production at a rate of 1 to 2% per year, which would include asset sales. The company said from now on it would allocate 25% of its capex to renewables and marketing, or $5 to $6 billion. Marketing includes retail gasoline stations and lubricants.

Morgan Stanley: Gasoline could become worthless. Morgan Stanley says the market may be ascribing zero or even negative value for ICE-derived revenues at GM and Ford and has listed a variety of factors that are likely to transform the companies' once-profitable assets into potentially cash-burning and loss-making businesses.

Texas RRC delays flaring decision. The Texas Railroad Commission again delayed a decision on flaring permits, evidence that the regulator is starting to scrutinize flaring plans to a greater degree.

Marathon cuts 5% of workforce. Marathon Oil (NYSE: MRO) cut its workforce by 5%, and also cut executive pay.

China’s grid firms to buy 40% renewables by 2030. China will require its grid companies to purchase 40% renewable energy by 2030.

Rivian aims for IPO this year. EV-startup Rivian is planning to go public this year at a valuation of around $50 billion, which would make it one of the largest IPO’s of the year. Meanwhile, Xos Trucks Inc., another EV builder, is planning to go public with a SPAC with a $2 billion valuation.

Macquarie opens $2 billion renewables fund. Macquarie, the world’s largest infrastructure investor, announced that it would open a $2 billion global renewables fund, its second such fund, after strong interest from institutional investors. It will target wind and solar projects in Western Europe, the United States, Canada, Mexico, Japan, Taiwan, Australia and New Zealand.

Libya’s oil port reopens. Libya’s Hariga oil port reopened after a month-long strike, which had cut output by more than half from 320,000 to 120,000 bpd.

LG Chem battery dispute could disrupt EV manufacturing. LG Chem filed a trade dispute against SK Innovation for stealing trade secrets. If LG Chem wins, the U.S. may see disrupted imports of battery cells needed for EV manufacturing.

Biden admin launches $100 million clean energy funding. The U.S. Department of Energy’s Advanced Research Projects Agency-Energy, or ARPA-E, announced $100 million in funding for low-carbon technologies. ARPA-E funds high-risk high-reward early-stage technologies.

From Mr flippe-floppe-flye:

jog on
duc

 

[ducati916]

I am invested into VGS, international market ETF from vanguard. My goal is for early retirement, thoughts?
I have some small holdings in other companies, but majority of my position is with VGS

There are a number of variables around strategies you might employ: will you

(a) Buy and hold;
(b) Trade in/out;
(c) Hedge;
(d) Employ Options;
(e) Dollar cost average;
(f) Other.

The strategy(ies) that you employ will have significant impact on how your returns look. The market direction will impact the strategies that you employ.

(Very) generally speaking, to retire, you would need the dividend yield in nominal dollars to support your lifestyle.

At 2% you will likely need +/- $4M worth of stock to give you $80K, which is a bare minimum.

So to get to let's say $10M of stock, you'll (likely) need to accumulate additional shares, unless what you hold trades high enough to sell out and pay your tax on capital gains, to net $10M to reinvest in something else.

The above strategies can all be employed to increase your total holdings to a desired level, to then live off of dividend income.

Further questions:

(a) Do markets only go up?
(b) If not, capital gains are unlikely to provide what you seek:

Therefore, some strategies will likely need to be employed.

jog on
duc

 

[qldfrog]

About inflation:
Just a few figures: any falling rate? rego fee? 5 to 6 pc increase
Now i went shopping last week
uht milk at aldi .cheapest available $1.25 a litre
Diesel $1.23 medical insurance +6%
Fruits 3$ to 4$ a kg, bread reaching 3$ for decent multigrain loaf
coffee now around 5$
2y ago- i would say an easy 10% less
House prices still going up,no pay rise around if you are lucky still having a job

Not sure about situation in nz or us, but we have a noticeable price increase lately in daily cost here not sure about cars, tvs , but rent here in regional australia are up the roof.
People will soon learn how to spell inflation ?

 

[samuilk]

There are a number of variables around strategies you might employ: will you

(a) Buy and hold;
(b) Trade in/out;
(c) Hedge;
(d) Employ Options;
(e) Dollar cost average;
(f) Other.

The strategy(ies) that you employ will have significant impact on how your returns look. The market direction will impact the strategies that you employ.

(Very) generally speaking, to retire, you would need the dividend yield in nominal dollars to support your lifestyle.



View attachment 120057

At 2% you will likely need +/- $4M worth of stock to give you $80K, which is a bare minimum.

So to get to let's say $10M of stock, you'll (likely) need to accumulate additional shares, unless what you hold trades high enough to sell out and pay your tax on capital gains, to net $10M to reinvest in something else.

The above strategies can all be employed to increase your total holdings to a desired level, to then live off of dividend income.

Further questions:

(a) Do markets only go up?
(b) If not, capital gains are unlikely to provide what you seek:

Therefore, some strategies will likely need to be employed.

jog on
duc

Awesome reply thank you. I follow Dollar Cost Average approach, for the vgs etf. I'm guessing 2% dividend isn't high? Perhaps I should look at other etfs?

 

[ducati916]

Awesome reply thank you. I follow Dollar Cost Average approach, for the vgs etf. I'm guessing 2% dividend isn't high? Perhaps I should look at other etfs?

I actually like dollar cost averaging. So if this is a preferred strategy, then yes, 2% is low and you can do much better. Here are some examples:

So you would go here: https://etfdb.com/

As an example I have selected:

Now reading the blurb, we see that this is an actively managed fund. Might be good, might be not so good down the road. A risk to evaluate. The dividend at 12% is attractive. In part it is attractive because 'Preferred' stock and 'Convertibles' sit higher in the capital structure than equity. This (in theory) should fluctuate less than equity. From a DCA point of view, this might not be as attractive, as you may want greater range in the fluctuations. It may be more attractive. Individual choice.

Then you can explore here:

FINVIZ.com - Stock Screener

Stock screener for investors and traders, financial visualizations.

finviz.com

So the 2 examples that I picked are simply random from the generated search. Both resources are free. Both will provide you with plenty of possible candidates.

In short, yes you can do far better than 2%, while maintaining many of the qualities that were attractive in your original choice.


jog on
duc