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Market – What, when and where to buy stocks for rebound on Bursa Malaysia?

Trading room – Tue 18 Dec 2018

The dreaded word has reached the biggest market in the world. US stocks fell further on Monday, pushing the S&P 500to a new low for the year amid growing concerns that the Federal Reserve’s plan to raise interest rates could be too much for the economy and stock market to handle.

The S&P 500 fell as much as 2.5 percent to 2,530.54, surpassing its February intraday low of 2,532.69. The Dow JonesIndustrial Average lost 507.53 points to close at 23,592.98, bringing its two-day losses to more than 1,000 points.

It was reported that the Dow and S&P500, which are both in corrections, are on track for their worst December performance since the Great Depression in 1931, down more than 7 percent so far for the month. The S&P 500 is now in the red for 2018 by 4 percent.

The tech-heavy Nasdaq Composite dropped 2.2percent to finish the day at 6,753.73.

However, the main news is that the US Russell 2000 index — which tracks the performance of smaller companies — entered a bear market, down 20 percent from its 52-week high.

The worry is that these names are the most sensitive to fluctuations in the US economy and market sentiment because of their small size, and could signal larger caps would soon join them.

According to one US analyst, the sell-off comes from the risk-off sentiment as “small caps are riskier than large caps, and there are some concerns about the end of a cycle in the U.S. and that we are entering a recession.”

The sell-off in small-cap stocks in the US is a sharp reversal from their outperformance earlier this year.

Small caps there had benefited from bets that small, domestic-oriented companies would be immune to the trade tensions between the U.S. and China and benefit most from the U.S. tax cut. However, rising rates and increasing costs on things such as wages ultimately dented the appetite for smaller companies, along with an overall risk adverse sentiment.

We know that any time the US market sneezes and in this scenario cough heavily, the flu is likely to spread across markets all over the world.

The local bourse, Bursa Malaysia has also seen relentless selling of small cap and high-beta stocks in the last few weeks as could be seen from the falls in the Small Cap Index, ACE index and technology stocks.

But these falls are also presenting tremendous opportunities for rebound plays for long buyers. Where and when exactly will there be a rebound in these major indices and how long will they last?

Elite traders know that tracking and knowing these levels make all the difference between them and the common traders as they can enter and exit much earlier for above-average gains when the rebound comes.

There are many ways one could accumulate stocks near to their lows.

The presence of divergence, stretched volatility and cycle, strong support or breaking of major critical resistance levels are just some of the methods that could be calculated mathematically in advance to present low-risk high probability entries.

These mean that one should be prepared to buy the right stocks at the right time and at the right level, even while others are still selling.

Indices Outlook for Bura Malaysia

Note: Certain info presented in the tables above has been redacted to comply with the agreement with elite members of the mPower Algorithm program and mPower Trading program and certain institutional clients. The above analysis reflects our personal view only and is subject to terms of use. Please refer to the full report inside for the complete info.

The selling on the market has been indiscriminate and likely based on sentiment with the baby being thrown out along with the bath water. A study of both fundamentally strong stocks and their technical/tactically levels using big data and algorithm-calculated levels will easily show the best stocks to accumulate and their levels and timeto do so.

Here is a list of such tradeable stocks and trade action should be undertaken as soon as their critical levels are breached to the upside. Double-digit gains are likely in a rebound play and elite traders should watch these stocks closely at the critical levels given and adopt appropriate position sizing.

Priority should be given to high betasector and stocks (highlighted in orange).

Note: Certain info presented in the tables above has been redacted to comply with the agreement with elite members of the mPower Algorithm program and mPower Trading program and certain institutional clients. The above analysis reflects our personal view only and is subject to terms of use. Please refer to the full report inside for the complete info.

Join and network with us at our mPower Algorithm and mPowerTrading programs and see how your outlook on the market and stock portfolio could be helped and shaped by big data analytics and trading algorithms.

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Market – The state of global markets and KLCI

Trading room – Mon 17 Dec 2018

Stocks fell sharply on Friday in the US after weaker-than-expected data in China and Europe exacerbated concerns of a global economic slowdown.

The Dow Jones Industrial Average fell 496.87 points to24,100.51, its lowest level since early May, led lower by declines in Apple and Johnson & Johnson. For the year, the Dow is now down 2.5 percent.

Meanwhile, the S&P 500 dropped 1.9 percent to 2,599.95 —its lowest closing level since April. The index also closed down 2.75 percent for 2018 year to date.

Continue reading Market – The state of global markets and KLCI
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Market – When will the sparks fly again globally?

Trading room – Mon 10 Dec 2018

Stocks dropped sharply on last Friday in US after a major rebound from the lows on Thursday, concluding what has been a wild week for Wall Street.

A weaker-than-expected jobs report and China-U.S. trade tensions sent the Dow Jones Industrial Average lower by 558.72 points to 24,388.95 and erased its gains for the year.

At one point, the Dow was up more than 8 percent for 2018.

Continue reading Market – When will the sparks fly again globally?
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Market – US Dow plunged 780 points on Thursday and then rebounded violently

Trading room – 7 Dec 2018

US stocks closed well off their session lows on Thursday after news broke that the Federal Reserve could tighten monetary policy at a slower pace than previously expected.

The Dow Jones Industrial Average closed 79.40 points lower at 24,947.67 after plunging nearly 800 points, while the S&P 500 closed0.15 percent lower at 2,695.95. The Nasdaq Composite erased its losses, closing 0.4 percent higher at 7,188.26 as Amazon, Netflix and Alphabet all rose more than 1 percent.

Continue reading Market – US Dow plunged 780 points on Thursday and then rebounded violently
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Market – Truce in global trade war, how should you trade?

Trading room – Mon 3 Dec 2018

 

It was reported that US president Donald Trump and China president Xi Jinping had agreed to a 90-day trade truce to allow for additional negotiations to address US concerns after China agreed to buy a “very substantial” amount of American exports, the White House said in a statement released late on Saturday.

It said that Chinese officials agreed that the country would buy more US products in an effort to reduce the large bilateral trade imbalance.

Meanwhile, Trump agreed to postpone for 90 days a scheduled increase in tariffs on US$200 billion in Chinese imports while talks to address American concerns about China’s trade practices take place.

Continue reading Market – Truce in global trade war, how should you trade?

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Market – Commodities prices outlook adding to market worries or hope?

Trading room – Thur 15 Nov 2018

The world economy has lost some steam in recent months and is likely to slow much further in the next couple of years according to some recent analyst reports.

According to an analysis in Bloomberg, markets got high on synchronized growth but the buzz is fading and an urgent question taking place is whether the equity markets worldwide can get another fix fast.

Apparently, the omens aren’t great.

Continue reading Market – Commodities prices outlook adding to market worries or hope?

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Market – US elections results: Will it work out?

Trading Room – Thur 8 Nov 2018

The U.S. mid-term elections results are in. And the world markets are watching closely. The Democrats have won control of the House of Representatives in the U.S., granting them a check of President Trump’s power and policy. The Republicans, meanwhile, have kept the Senate.

It was reported that both sides in the US have claimed the result as a victory with President Trump tweeting about the “tremendous success tonight.” But he will also know that the result will allow Democrats, who could control the House for the first time since 2010, to thwart or frustrate his more controversial social and economic policies.

Continue reading Market – US elections results: Will it work out?

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Market – Has the tide turned?

Trading Room – Thur 1 Nov 2018

Markets love to surprise and markets love to trap too. The immense skill of an elite trader is to determine which is the likely scenario on the balance of probabilities using the widest array of information available. Common traders will tend to get carried away in media headline news explaining the move AFTER it happened (see this report on “when trades go wrong”) Continue reading Market – Has the tide turned?