Comment of the Day
Video commentary for January 20th 2022
Some of the topics discussed include: silver cheap relative to dogecoin, Wall Street remains weak, Chinese shares rebound, Dollar and Renminbi steady, oil downside key reversal, medium-term correction more likely than end of the bull market. No chance of rates rising four times this year.
Logical inconsistencies
My view - There are times in the market when a comparison between two assets classes serves to highlight a disparity that has become so wide that it inspires a sense of wonder, confusion and questioning
In December 2020 there was a news headline to the effect that Tesla’s market cap was greater than that of the next 9 largest car companies combined. There are two ways of thinking about that statistic. The first is enthusiasm for Tesla shares was running at fever pitch. The second was that the other auto companies were cheap by comparison.
Email of the day on Dow Theory for the 21st century
Hope you and the family are well Eoin, no doubt your children are pretty grown up now, although probably still on the payroll.
I know David would have been fascinated with the ‘Capitulation Indicator’, that forms part of a ‘Dow Theory Buy Signal’, so I attach my 2-page note on that indicator also. It dovetails well with the ‘Dynamic’ move at the ned of a bear markets that he looked for. I was sorry to hear of his passing, way too early in life.
Feel free to share both of the above attachments, if you deem them of interest to your own subscriber base.
My view - Thank you for generously sharing your two research reports. My girls (13&15) are certainly still on the payroll and continue to demand higher wages ???? I agree David would have appreciated the data on capitulations in the stock market over the last 80 years. His identification of acceleration as always being a trend ending is perhaps one of the most useful of observations as well as dynamic moves representing points of interest for the investment crowd to denote change.
China Stocks Rally With Tech, Property in Lead Amid Easing Bets
This article from Bloomberg may be of interest to subscribers. Here is a section:
The Hang Seng Tech Index jumped 4.5%, with Meituan and Tencent Holdings among those leading gains. The gauge has started 2022 with an advance after losing about a third of its value last year amid Beijing’s clampdown on tech companies.
The rally followed clarification from China’s internet regulator late Wednesday that it’s not asking to approve all investments or fundraising by big tech companies, denying an earlier media report.
A Bloomberg Intelligence gauge of Chinese real estate developers advanced 3.6%, following reports that the government may ease access to some funds. The sector’s gains came even as Thursday’s cut in the five-year loan prime rate left some market watchers disappointed.
Shares of Country Garden Services Holdings Co. and Sunac China Holdings Ltd. surged more than 10% each. The unwinding of some short positions also likely aided the rally in property stocks, traders said.
Agile Group, Shimao Group and Guangzhou R&F have about 20% of their free-float shares sold short, among the highest in the MSCI Asia Pacific Index, according to data from IHS Markit.
My view - Chinese New Year is on February 1st and will be followed by a week-long holiday for mainland markets. At the same time the winter Olympics begins on the 4th which will focus the sporting media’s attention on Beijing. The central bank is making sure its messaging is clear ahead of the shutdown. That’s also aimed at instilling some confidence in investors that the squeeze on private property developers will be limited to that sector.
Eoin's personal portfolio short profit taken January 11th
One of the questions subscribers as most often is how to find details of my open traders. To make it easier I will simply repost the latest summary daily until there is a change.
The Chart Seminar 2022
With global vaccination rates rising, the prospect of anti-COVID pills on the horizon and the promise of travel restrictions being dropped, it is time to start thinking about venues for The Chart Seminar in 2022.
Please drop sarah@fullertreacymoney.com a line if you would be interested in attending an event next year, as well as your preferred location.
At present I am looking at a late May date for a London seminar and I am open to other times and locations subject to demand.