Trading Room – Friday 26 Oct 2018
The global rout in stock markets worldwide and on Bursa is continuing and it’s likely too early to pick an absolute bottom.
Stocks rose back on Thursday in US as Wall Street recovered from a tumble in the previous session that sent two of the major indexes into the red for 2018.
The Dow Jones Industrial Average rose 401.13 points to 24,984.55 — snapping a three-day losing streak — while the S&P 500 gained 1.9% to close at 2,705.57 as consumer discretionary and tech both rose more than 3%. Both indices are back slightly into the green for 2018.
The Nasdaq Composite climbed 2.95% to 7,318.34 as Amazon rallied 7.1% ahead of the release of its earnings report. However, Friday may be another volatile session for tech stocks as Google-parent Alphabet and Amazon fell in after-hours trading after missing expectations on the release of their quarterly results.
Share prices do not move in straight vertical manners and more likely in a staircase manner and hence there are plenty of opportunities to trade the current falling (and volatile) markets as falls and rallies occur in cycles.
It’s still too early to call it a bear market but the definition is not important.
What is obviously happening is a meltdown and pent-up of selling pressure and volatility, which has been missing as investors assumed that stock markets will continue to remain resilient in low volatility all the times even in the face of mounting worries.
As it turns out, the bulls have been tiring all along as depicted by the various underlying indices and small/mid-caps stocks peeling away to the downside while leaving the major large caps flag-bearers standing to hold the march at the top.
This phenomenon was seen in the US stock market, which is arguably the longest and strongest bull market in the world, and in Bursa Malaysia, which is arguably the most defensive stock market in our region.
Normally hidden from the news and investors’ euphoria, this phenomenon was flagged down by our Master Algorithm, which covers the entire breadth and depth of global markets and Bursa Malaysia stocks, and triggered many alarms and sell signals long before the current event comes to fore.
There could be a short recovery in share prices soon before the downtrend resumes it path.
However, any surprise may be to the downside, not upside and due to this, rebound trades may be more suitable for aggressive traders such as those following the mPower Trading program, which is plugged in to the Master Algorithm.
While making forecasts is after all a science of probability, not exactitude, elite traders always need to have a best probable course of action to act on regardless that it’s a forecast of the future. Obviously, the quality of the forecast is of paramount importance as being able to act fast ahead and earlier than the crowd is an essential edge in trading.
The main question we have to answer now is where is the absolute bottom for Bursa and the major world markets in the current downtrend? When is the best time for us to trade long for a major confirmed rebound in individual stocks?
Using dynamically calculated price projections on millions of data, the Master Algorithm has and will continuously pinpoint these levels mathematically in advance for us to act for a major reversal in multiple time frames.
Do follow these projections in our mPower Algorithm report as the dynamic calculations continuously looped to an optimum focal turnaround point as millions of data points converge.
Note: Certain info presented here has been redacted to comply with the agreement with elite members of the mPower Algoritm program and mPower Trading program, Please refer to the full report inside for the complete info.