Bull market continues. Weekly market observation 22Oct2021 This has been a bullish week for stock markets. S&P500 daily chart S&P500 says it all. S&P500 hits an all-time high on 22Oct2021 and closed near the high. U.S, the stock market leader in the world, is in a bullish mood. Hang Seng index daily chart Hang Seng Index(HSI) rose 3.14% this week and closed near the high for the week. The percentage weekly rise is the highest since the mini-rally started in 5Oct2021. At this moment, HSI is still below the 200-day moving average. It is recovering but not considered strong. The broad market statistics for the Hong Kong market is not good enough at this moment to get more heavy into individual stocks, although I did buy a few this week. The percentage of stocks above the 50-day moving average is 43.17%. Although this is an improvement from last week (36.52%), I will prefer to see it above 50%. China broad market statistics continue to look worrying. The number of China stocks near 52-week high vs 52-week low is 33 vs 125. The number of 52-week lows has worsened to 125 (last week was 75) this week. When the China giant is weak, it is hard to be confident that the smaller HK market can stay strong. Straits Times Index weekly chart Straits Times Index rose 0.98% this week and closed at 0.9% from year 2021 high. Unfortunately, this positive action was made in lower volume. When an index is near a significant previous high, I prefer to see it moving up in higher volume so that it has the strength to break through the resistance. Next week will be a good test on the strength of the rally, as it seems like a pullback is coming. I have added more stocks to my Singapore portfolio this week. Some stocks in my portfolio that seem promising so far are Netlink Trust(SGX:CJLU), Silverlake Axis(SGX:5CP), Hong Kong Land(SGX:H78), Golden Agri-Resources(SGX:E5H). This post was a continuation of last week's market observation. https://www.elitetrader.com/et/threads/market-observations-and-actions.361931/page-5#post-5473679
U.S bull market continues to charge. HK down. SG remains steady. Weekly observation 29Oct2021 U.S stock market bull continues to charge this week. S&P500 made an all-time high this week and closed near the high on Friday. So did Nasdaq 100. It was a bad week for Hang Seng Index. It is now below the 21-day, 50-day, 200-day moving averages. This is not a good environment for individual stocks to perform. The broad market statistics for HK market showed deterioration on all counts compared to last week. Interestingly, in China's stock market, the number of 52-week highs vs 52-week low has shown a marked improvement, although the percentage of stocks below key moving averages have shown a decline across the board compared to last week. The Singapore stock market is showing some resilience this week in the face of weaknesses in other Asian markets like Australia, India, Korea, Thailand, Philippines. Singapore is a small economy and is strongly influenced by what happens to her neighbours. So, one had better be cautious about getting aggressive in Singapore stocks when neighbouring Asian markets are not doing well.
U.S bull market can't stop. HK, China bear market can't stop. SG broad market weakening but index remains strong. Weekly observation 5Nov2021 S&P500 rises 2% this week. This is its 5th consecutive weekly rise. Based on S&P500's reaction to reduce its monthly asset purchase, there is no need to worry about a taper tantrum at this point. The U.S bull market can't seem to stop. Meanwhile, over in Asia, the opposite is happening. Hang Seng Index dropped 2%, following last week's drop of 2.87%. China's CSI300 dropped 1.35%, following last week's drop of 1.03%. For traders, this is not an environment to buy stocks in HK and China. Straits Times Index rose 1.38% this week. But the message is different when one takes a deeper look at at the broad market. The advance/decline line (number of advancing stocks versus number of declining stocks) was negative for all 5 days of the week. I will be careful of adding more stocks to my Singapore stock portfolio at this stage. Broad market statistics 29Oct2021 Broad market statistics 7Nov2021 Broad market statistics for Hong Kong stock market suffered a sharp decline this week. Interestingly, it showed an improvement for China's. Outside of the stock market, I made a few purchases in the crypto market. I bought Ethereum and Solana on the strength of a breakout to a new high in the early part of the week.
You were dong fine until that statement. Ooohhh yes it can. There is risk in the market. Were you around in September?
That statement "U.S bull market can't stop" was a reflection of my observations on the U.S stock market for past 5 weeks. It doesn't mean the bull market can't stop going forward. I guess it may sound misleading to some readers, especially if they're inexperienced. Since this forum is full of elitetraders, this should be a non-issue. Let me qualify that statement regarding state of U.S market and HK/China markets today. The tide will turn some day, just not today. Markets are cyclical. Every dog will have its day. I'm a market observer. I observe, then react. I can't predict, that's why I don't predict.
And the elitetraders of this forum are going to tell you exactly what you do not want to hear...Your past 5 week observation of the markets means nothing in context, and you are misleading MOST readers here, not just SOME, since most readers here are not elitetraders.
Normal pullback in U.S and SG market. China/HK recovering. Weekly observation 12Nov2021 After enjoying 5 consecutive weekly rise, S&P500 had a normal pullback down 0.31% this week. This is a normal, healthy pullback. The rally in U.S stock market is intact. Like S&P500, Straits Times Index also had a pullback down 0.43%, though it looked worse due to the reversal bar on 9Nov2021. The rally in Singapore stock market is still intact. What shows promise are China and Hong Kong stock markets, particularly China. I am not impressed with the performance of China and HK stock indices because they look like normal rebound after weeks of bearish performance, with the exception of Shenzhen Composite Index. What makes me optimistic is the performance of China's broad market for past 3 weeks. Broad market statistics 29Oct21 - 12Nov21 The number of China stocks rising above 21day, 50day, 200day moving averages have been steadily improving for 3 weeks. Number of stocks near 52-week high vs 52-week low has markedly improved at 110 vs 3. Hong Kong's broad market also showed improvement this week, although the improvement is not as impressive as China's. I will be observing China's stock market in the days ahead. For the time being, I am still not buying. Market conditions have not yet recovered enough for me to feel comfortable buying.
Time to resume buying China stocks as the market has recovered enough. Weekly observation 19Nov2021 The important price action is in China's stock market this week. CSI300 made a follow-through day on Friday(19Nov2021). So did Shanghai Composite Index (SSE). SSE closed above the 50-day moving average, 21-day moving average after hovering below these moving averages for weeks. Shenzhen Composite Index (SZSC) made a follow-through day 1 week ago on 11Nov2021. The broad market statistics for China's stock market has been improving every week for 3 consecutive weeks. Look at the steadily rising percentage of China stocks above 50-day and 200-day moving averages. It is time to resume buying China stocks. I have started buying a few this week. S&P500 was flat this week. Market action elsewhere in the U.S market was confusing. Nasdaq100 rose 2.31% but Dow Jones Industrial dropped 1.38%. The small-caps index Russell2000 performed even worse as it dropped 2.85%. The overall broad market as indicated by Russell3000 declined only 0.14%. The U.S market rally is still intact. Straits Times Index was flat this week, rising by only 0.12%. Hang Seng Index performed well early in the week but ended the week on a disappointing note, closing down 1.1% for the week. Hong Kong market remains in the doldrums.
Global stock markets infected by Covid. China market is still running strong. Weekly observation 26Nov2021 Covid variant Omnicron smashed global stock markets this week. On Friday (26Nov2021) when this new variant was announced, almost all the Asian stock indices plunged big on high volume with the exceptions of China and Vietnam (Vietnam index is best performing Asian stock index in 2021 year-to-date). U.S stock indices behaved in similar fashion with the small-cap stocks getting far more damaged than their big-cap counterparts. The European stock indices fared the worst. Most of them gapped down, opened low and closed much lower at the day's low in high volume. Global stock indices on 26Nov2021 (percentage over exponential moving averages) The table above shows where the stock indices fare with respect to the moving averages, sorted in descending order with respect to the 50-day moving average. Hang Seng Index is the worst performer. The China stock indices, Shenzhen and Shanghai composite index, are still surviving well, hovering above the 21-day, 50-day, 200-day moving averages. The big-cap U.S stock indices, Nasdaq100 and S&P500, are also still surviving at the moment. The rest of the world does not look good. Broad market statistics 19Nov21 - 26Nov21 There is a sharp deterioration in the broad market in Singapore and Hong Kong stock markets. Both markets are in risk-off mode. I will start to trim down my Singapore portfolio as the market continues to weaken. I mentioned last week that I have started buying China stocks. I continued to buy and bought more as the portfolio got more profitable. Although this was a bad week for global stock markets, individual Chinese stocks did not do too badly. This can be seen from the broad market statistics. Some China stocks I bought in the past 2 weeks which performed well in the portfolio were 600580.SS (Wolong Electric Drive), 002180.SZ (Ninestar Ord), 603568.SS (Zhejiang Weiming Environment Protection).
Global markets worsen. U.S market rally dies. China bucks the trend. Some China stock picks revealed. Weekly observation 04Dec2021 Last week was bad for global stock markets. This week (29Nov2021 - 3Dec2021) was worse. The U.S market rally looks dead. S&P500 and Nasdaq100 fell below 50-day moving average in high volume. Small-cap index Russell2000 fell below 200-day moving average. U.S market is a leader for global stock markets. When U.S stock market falls, it is hard for other smaller stock markets not to follow, let alone go against the tide set by the leader. One exception is China's stock market, which is a leader in its own right. European markets and Asian markets fared worse with China being the exception once again, like last week. Broad market statistics 26Nov21 - 03Nov21 The number of stocks above key moving averages in China's broader market showed a marked improvement this week despite the global stock carnage. Another sign of strength is the gains made by some stocks in my China stock portfolio this week. Here are the weekly gains made by the stocks I revealed last week; Here are some of the promising stocks which performed well this week in my portfolio. 002556.SZ (Anhui Huilong Agriculture) 603713.SS (Milkyway Chemical) 600879.SS (China Aerospace Electronics) 603236.SS (Quectel Wireless) 600072.SS (CSSC Science & Technology) 000568.SZ (Luzhou Laojiao) 600745.SS (Wingtech Technology) 600764.SS (China Marine Information Electronics) 600378.SS (Haohua Chemical) 001872.SZ (China Merchants Port Group) 002389.SZ (Aerospace CH) 002859.SZ (Zhejiang Jiemei Electronic) These stocks are the current leaders in my portfolio. Tracking them and putting it into writing gives me a closer feel for the market as a market observer. I am not revealing them to promote myself as a guru and then sell an expensive financial trading course. Please do not follow my portfolio stocks blindly. I am not a licensed financial adviser and not qualified to give financial advice. Some of the stocks are extended in price and chasing them at high prices can lead to financial damage. I already have some profit cushion as protection. With global markets in shaky grounds this week plus the crash in cryptocurrencies yesterday (04Dec2021), it does look risky to plough into Chinese stocks next week. What I do for myself may not be suitable for the risk appetite of general public. One attraction of China's stocks at this point in time is the strong Renminbi year to date. USD is a very strong currency this year. If I may say so, USD is so strong that it almost made currencies of Japan, Europe, Australia look like emerging countries'. Year to date (3Dec2021), USD has appreciated against Euro by 8.07%, appreciated against Japanese Yen by 9.31%, appreciated against Australian dollar by 9.92%. Against this backdrop, offshore Renminbi (CNH) actually managed to beat USD by 1.92% (onshore Renminbi is even stronger). USD appreciated against major currencies by huge margin year to date except for CNH This was a bad week for Singapore stock market. Straits Times Index dropped 2.03% on high volume for the week. I have been aggressively selling down stocks in the Singapore portfolio and sold off most of the stocks in the portfolio by end of the week as they reached designated price levels to manage my risk exposure. Hong Kong stock market has been in the doldrums since Sep. I have zero exposure to HK stocks at this moment. However, HK stock market valuation is attractive. Hang Seng Index(HSI) traded below book value this week. It is not only HSI which is cheap. The broad market is cheap too. You can see how battered individual HK stocks are from the percentage of stocks below key moving averages. When the stock market rally returns to the HK market eventually, it is likely to be a strong bull market. However, it is still not yet time to start buying HK stocks as I can't smell any rally at the moment. If you are a long-term value investor who does not care about market timing, now would be a good time to start looking in HK market.