Unusually I am typing this on a Saturday Night because I have to go out all Day tomorrow and just won’t have time. A big advantage for me is that on Saturday Night the TV is truly abysmal so I am working on this whilst playing some CDs and stuff which is far less distracting than the Gogglebox and it is highly unlikely that there will be any decent Programmes for which I need to take a break; often on a Sunday Night there is something worth watching like ‘Dragon’s Den’ and that really slows me up on getting the Blog done !!
I’ve got a hugely busy Week ahead of me - normally I like to hibernate for the Winter and stay in the warm but sadly my desires often get totally usurped. Tomorrow I am off to Swindon around Midday to visit my Mum who is extremely seriously ill in Hospital and I suspect this will be one of several trips I will be making down there in the near future. She is 83 and very frail and had doses of Dementia and the latest seems to have been a possible Heart Attack that has then brought on a Stroke - so things look very iffy. After this I am off to Basingstoke to see Deacon Blue on their 30 Anniversary Tour (30 Years !! Sheeeshhh) at The Anvil which is a fantastic Venue as it is really small and the Wheelchair bit is right near the front but sort of back a few Rows and raised up so it is an excellent position. And not just that, I can wheel straight in which is wonderful and very easy (all other Venues take note !!).
Then on Tuesday I am heading up to Chiswick in the Afternoon to attend the Mello Conference Event thingy which should be really good fun. The last Mello Event I went to up in Derby was superb and what I find extremely valuable is the chance to meet up with all my Mates from Twitter and no doubt many Peeps who I have not met before but we probably discuss things on Twitter etc. - it should be fun. This is taking place on Monday and Tuesday and there are probably a few Tickets left and I know David Stredder (@Carmensfella on Twitter) who organises it was offering Tickets for £20 for People who already have Tickets to bring along a Friend. You can find details here:
http://melloevents.com/ Of course a possible limitation for me regarding Tuesday is if I have to drop everything and rush down to Swindon due to my Mum’s condition - that’s up in the air really. Then on Friday I should finally be picking up my Seat Leon Cupra 290 DSG (note, 290, not 300 - Grrrrrrrr) from High Wycombe because the Conversion to the Hand Controls I require has now been done. Obviously I am starting to get excited about this and after the fiasco having to drive it before with ridiculous Hand Controls I am hoping that I get a much better sense of what the Car is really like. Fortunately things have turned out well and the previous Hand Control bits that were fitted are of use and it means that the whole thing has probably cost me £100 more than it needed to but that is a tiny Price to pay when you consider that doing it this way has been worth about £4,500 in saved VAT on the Car. Bizarrely when I tot everything up, the Car has actually cost me less than I had expected which is rather sweet. So a very busy Week but with the Markets in their current miserable mood, it is probably a good time to have lots of distractions and to be doing other things that are of more interest. Last Week Yet another painful Week and my Portfolio bled another 2.2% despite my Hedging on the S&P500. This means that on the Year I am down about 11% and this is most annoying - however, that’s the way it goes sometimes and all I can do is keep plodding away and doing what I think is right to navigate these difficult Market conditions and to be ready for the Recovery when it comes (whenever that might be because despite December being usually a superb Month, there are no guarantees and we might just get more pain). I added a little more Short Hedging via the S&P500 Last Week so I am now about 25% Hedged against my Long Portfolio (see the ‘Trades’ Page on the Main WD Website) - this is about the right sort of level I think but I am probably going to add another 5% early in the coming Week if the Charts tell me to do this - I will be looking at the Charts in a bit on this Blog as usual and my suspicion is that they continue to look ropey as hell. So my Strategy remains the same - not buying much if anything and looking to Sell if sensible opportunities present themselves. I am letting Dividend Cash build up and not deploying it as I think there will be much better times to get Buying - but this might be in 2019. It is my view that Brexit is putting a big downer on things although it is not clear if this is adding to the Global Malaise that we are seeing - it strikes me that much of the fall in the US is down to Tech Valuations being reassessed but it could also be that fears around Brexit and the impact on both the UK and EU Economies has a knock-on effect on the US as Investors Sell Foreign Stocks to rebalance Portfolios and to cover Margin-Calls resulting from UK exposure etc. All Markets are very closely integrated and correlated so it is no huge surprise that feared problems in the UK and Europe have an impact on the US etc. There are definitely signs of Slowing Economies like China and Japan and the UK of course but it is worth nothing that a ‘Slowing’ Economy is very different to a Recession - and I suspect that once we have clarity on the Brexit way forwards, we might get the start of a Rally - whatever the Outcome is. The key here is CERTAINTY not what the Outcome is - ‘No Deal’, No Brexit, Theresa May Deal (highly unlikely), Managed ‘No Deal’ etc. I am sure that another General Election will just add to Uncertainty and cause more wobbles. A Second Referendum is probably the most unlikely possibility. From my experience, serious Drops in Markets only happen when there is a Global Recession and we are far from that even if certain Economies are slowing a little - and they could soon speed up again anyway in 2019 - especially if Interest Rate Rises are delayed and if Oil Prices continue to fall. Whatever happens, I just see no need to be Buying now and I am quite happy to let things play out. If Markets do pick up I am hugely Long anyway and I can take the Shorts off in seconds. Something that does concern me about these Markets is that after a substantial Sell-off like we have had, you usually need a ‘Big Massive Selling Scary Panicky Capitulation sort of Day’ to clear the Market where the Final Bulls throw in the towel - we had a few wobbles in October but recently it has been quite calm - I fear we need a Super Terrifying Day to really enable a Rally to start. Blog Slate Finally I have finished those ‘Stock Buy Checklist’ things and there are now 4 of them parked in the Archive - if you look at the one I issued Last Week, this has Links to the other 3. Last night I made huge progress on the Blog Series about ‘Moving into Cash’ and I have now got the Structure sorted and pretty much completed a very good Draft of it all. I have sort of misrepresented this really because it is a strange hybrid of a Blog Series in that really it is mainly supposed to be about things about the Markets and Investing which are Certain and Uncertain and related to this is the concept that we should focus on ‘Controlling what we can Control’ - but this over-riding Principle has been usurped really by me using the idea of ‘Moving into Cash’ to illustrate the Principle. On this basis you can see that really you will be getting 2 Blog Series’ for the Price of 1 !! Anyway it is truly an absolute Beast of a Blog Series and it has evolved into 5 Parts and I think I will be able to issue Part 1 later this Week - it is pretty much ready but if I decide not to then I have a totally different Blog in reserve so don’t worry, there should be something new to endure. The big advantage for me of having 5 Blogs pretty much lined up and ready to go is that it takes a lot of pressure off in terms of getting them produced and I have more than caught up after my period of ‘illness’ which stopped me writing much new material and depleted the Pipeline. There are things I still want to do to the Websites and hopefully with this Backlog of Blogs already on the shelf this will give me time to do some of this other stuff - and I am sure it will improve the stuff for Readers. I also have another ‘Non-Finance’ Book Review lined up and I have finished reading ‘American Sniper’ just this morning so that is another Review I need to write. Of course with Xmas coming, Wheelie’s Bookshop is the ideal place to buy lots of Presents !! (hint, hint) The Twin Pete’s Podcast has gone down a storm and I am so pleased with the reception - I will be speaking with @Conkers3 on Tuesday I think at Mello and no doubt we will be working on our next Cunning Plan for another Podcast. The Way we Were Now we have the full Educational Blog Archive fully Linked up on the ‘Blog Index List’ Page on WD2 you can dig through these and easily find Subjects you want to read about, but as a taster of what is buried in there after 4 years of my scribbling, here is a Blog Series from a while back about Portfolio Management consisting of 2 Blogs: http://wheeliedealer.weebly.com/educational-blogs/pin-the-tail-on-the-monkey-musings-on-portfolio-management-part-1-of-2 http://wheeliedealer.weebly.com/educational-blogs/pin-the-tail-on-the-monkey-musings-on-portfolio-management-part-2-of-2 Right, I need to dash off for a bit and lob a Chicken and Pesto Pizza into the Oven (yeah, I thought it sounded dodgy too !!). S&P500 As ever, the Charts I am shoving in here are ScreenGrabs from the excellent SharePad thing I use and if you click them you should be able to see more detail. By the way, the Pizza wasn’t too shabby (although it was too cooked !!). First off we have the S&P500 and this is the Long Term Chart going back to the 2009 Lows. My Blue Line is showing the Uptrend Support and note a Pullback to this Line would still mean we are in the Uptrend but from where we Closed on Friday that is about another 9% down to get to 2400 - and it could go a bit lower.
There’s a lot on the next Chart but for time and ease reasons I didn’t want to make it into more Charts. First off look at the Parallel Green Lines - the Bottom one has a Green Arrow on it. What’s particularly interesting is that you can see similar Lines on the DOW and it could be a Sideways Range that is going to play out in coming Months - if so, we could Bounce on the US Markets very soon as the Downside to the Bottom Green Line is not much at all. Note also where my Red Arrow is that we have good Support at just over 2600. In fact, if 2600 Fails then I would expect a much bigger Drop.
Next look where my Black Arrow is which is trying to point to where the Darker Blue Wavy Line 50 Day Moving Average is heading towards the Lighter Blue Wavy Line 200 Day MA and if they Cross, we get a ‘Death Cross’ which can imply Weeks and Months of weakness ahead. However, such Crosses are quite a late Indicator and it is possible that we get a Turn Up now and any Death Cross soon reverses and we get a Bullish ‘Golden Cross’ - we shall see. The Blue Horizontal Lines with the Blue Arrow on one of them are where I have Shorts Open and the Pink Line marked by the Pink Arrow is where my Stoploss is at the moment - but I want to lower that soon (my hesitation is because the Level I have it at now, 2825, is at a point where if it is triggered I can be very sure the Markets are rising again and so I won’t be needing the Hedges). I won’t go into detail here but the Candlestick from Friday showed yet more weakness and it is typical of how the Markets have traded recently with Gains earlier in the Day being wiped out by the Close. Of course Last Week was skewed a bit by Thanksgiving Day and we might get more positivity this Week simply because that is out of the way.
If you look at the Bottom Window on the Screen below, we have the RSI (Relative Strength Index) for the S&P500 Daily - on a Reading of RSI 34 it is very low but it can go lower. Note also that the RSI is falling - the Direction is very important as well.
In the Window at the Top, we have the Daily Heiken Ashi Candlesticks - where my Red Arrow is, we have a Big Black Down Candle and this suggests more downside.
On the next Screen we have the Daily Candles for the S&P500 but what I am interested in here are the 13 and 21 Day EMA (Exponential Moving Average) Lines and where my Black Arrow is you can see that these Lines (they are Red and Black and wobbly) did a Bearish Crossover and this is still ‘in force’ at the moment. When we get a Bullish Cross between these Lines that will be a very good Indication that we are going higher in a reliable way.
Something else to look at is my Blue Arrow over on the Left Hand Side at the Bottom which is pointing to another good Support Level at just over 2550.
Next we have the Weekly Candles - my Blue Arrow is pointing to a Big Ugly Black Candle. That is obviously Bearish and as yet there is no Reversal Candle on these Weekly Candles. The Red Line and Red Arrow are simply pointing out the important Support at 2600.
Now we have the Daily Candles with the Pink Zone in the middle coming between the Upper and Lower Bollinger Bands. Where my Black Arrow is I am pointing out that the Price is now down near the Bottom Band and we might turn up soon. However, it is not uncommon for a Price to ‘Hug’ the Bands and go up or down more than the Bands predict.
I won’t show the DOW and Nasdaq Comp as they are very similar.
FTSE100 First off we have the Big Picture with the Red Lines on my Chart marking the Uptrend Channel from the 2009 Lows in a similar way to what I did on the S&P500 a few Charts ago. Where my Red Arrow is the Price might drop down to find Support and this is in the region of 6400 - 6500.
I’m gonna bore you all senseless now by saying the same as what I wrote Last Weekend most likely !! The Blue Arrow on the Chart below shows a Bearish ‘Death Cross’ between the 50 and 200 Day Moving Averages and this could be a problem but what really matters is the Range between the Blue Line and the Red Line at about 6850 to 7200 - where we go next depends on how this Sideways Range breaks - if it breaks above then expect more upside and if it breaks below, then we are in the merde.
In the Bottom Window below we have the MACD (Moving Average Convergence Divergence) for the FTSE100 Daily. My Black Arrows are pointing to where we have Bearish MACD Crosses in the ‘Signal Lines’ and ‘Histogram Bars’ formats. However, this is not a great Indicator/Predictor in my view but it helps to paint the picture when combined with other Indicators.
In the Bottom Window below we have the RSI for the FTSE100 Daily and my Red Arrow is pointing to where we are now on a Reading of RSI 35 - this is a low Reading but it can go lower and note the direction of travel is down.
Please ignore a lot of the Lines and stuff on this Chart as all I want to show is that where my Red Arrow is we had a 13/21 Day EMA ‘Death Cross’ and this is still ‘in force’ (until we get a Bullish Cross which is the other way).
Now we have the Weekly Candles. This looks slightly better than the US Indexes where we had Big Black Down Candles - where my Black Arrow is we got a sort of ‘Cotton Reel’ Doji Last Week (don’t look in the Book, this is my name for it !!) and this shows uncertainty with the Bulls trying to push the Price up. As before, the Key here is the Sideways Range between 6850 and 7200.
FTSE250
I want to finish this off now for time reasons but I will just chuck this one FTSE250 Weekly Chart in because the FTSE250 is really very similar to the FTSE100 at the moment. My Black Arrow is showing a Narrow Body Doji from Last Week and this looks more like a Reversal Candle so perhaps the FTSE250 can rise off of this. However, the Context is not great as you would like a string of Falls before really but as with the FTSE100 we have a Sideways Range between about 18200 and 19500 and it depends on how this Breaks. OK, that’s it for this Week - Good Luck for the coming Days and don’t do anything daft and rash. Cheers, WD.
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Stocks & Markets WheelieBlogsThese tend to be more Markets and Stocks related and timely - the Blog Page on the Main WheelieDealer Website has the 'Educational' stuff (well that's the theory anyway !!). Archives
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