Jun 26

Brexit: Where are the Opportunities?

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It was a Black Friday of the whole world market sell off due to Brexit. I received many questions from my friends, my students and my readers on what to do next. I list down some of the common questions here and list down my humble opinions.

Common Questions:

  • Will the Stock Market Crash?
  • Should I sell my stocks?
  • Should I buy Sterling Pound now?
  • Where are the investing opportunities for this Brexit?

Frankly speaking, I do not have the answers as I am not the fortune teller. Basically what I am doing now is Trade Base on What I See & Invest Base on My Objectives. I will be sharing what I see in the current movement of the financial market and where are the investing or trading opportunities. By the way, opportunities are everywhere as long as the Price Moves. It is not a rocket science! The key thing is how and where to find them.

Disclaimers: I have trading or investing positions in Gold, Silver, Crude Oil, VIX, S&P500 Futures, GBP/JPY and Singapore REITs. My views and analysis can be biased. All analysis here are my own view and do not constitute any Buy or Sell recommendation. I am not responsible for any profits or losses if you take any position base on the analysis here.

(1) World Equity Market Sell off and VIX Spiked

Brexit Futures June 24-2016 Brexit Global Equity June 24-2016 Indices June 24-2016VIX June 24-2016

Brexit Relative Performance

(2) GBP Plunged

GBP June 24-2016

(3) USD and JPY rallied

USD June 24-2016JPY June 24-2016

(4) Funds exit from equity and flight to safety to Bonds & Gold

Bonds June 24-2016

(5) Gold & Silver Rallied as both are correlated

Gold June 24-2016

(6) Crude Oil slumped as it has inverse relationship with USD

Crude Oil June 24-2016

(7) Financial Sector has the worst hit

Sector June 24-2016

(8) STI Sell off

STI June 24-2016

(9) Singapore REIT Index is just sitting on the neckline support of a Head and Shoulder reversal pattern. See Singapore REIT Fundamental Analysis table for potential investing opportunities for passive income.

FSTAS8670 June 24-2016

My Views:

There are a lot of investing or trading opportunities out there, why continue to fall in love in the stocks if the funds exit from equity market to other financial instruments like Forex, Gold, Bonds, etc? The objective is to make money from our investment but not to have a love affair with the stocks. Some of the strategies we can take advantage from this Brexit:

  • Trade on Rebound due to the knee jerk
  • Wait for the establishment of the new trend as Fund Managers will be re-balancing their portfolio due to this new development. Trade with the trend.
  • Be extremely careful with US equity market because it is at the market top
  • Position ourselves in the “flight to safety” type of financial instruments like Gold and Bonds if the stock market does crash
  • Watch the Euro as Europe will be in a mess and have high risk of dis-integration of United Kingdom and European Union. See The U.K. has voted for Brexit — what happens next?

Still do not know what to do? You can approach me for the Private Portfolio Review if you need help.

You can also send me an email marubozu@mystocksinvesting.com if you need help in building up your own investment portfolio but do not know where to start.

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Jun 19

Global Stock Market Indices PE Ratio At a Glance (19 June 2016)

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Market Indices PE Ratio for Major Stock Exchange globally

  • US: Dow Jones Industrial, S&P500, NASDAQ, Russell 2000
  • Europe: FTSE100, CAC40, DAX
  • Asia: KLCI, STI, HangSeng, ASX200, CSI 300, JCI, SET, KOSPI, NIKKEI 225, SENSEX, TWSE, NZX50, PSEi
  • Best Performer: India’s SENSEX up for 5.23% with PE Ratio of 20.10
  • Valuation of Global Stock Market is NOT cheap base on PE Ratio
  •  PE  = Price Per Earning

See May 2016 Global Stock Market PE Ratio here.

Global Stock Market PE Ratio Summary June19-2016

Shiller SNP500 PE Ratio June19-2016Shiller SNP500 PE Ratio Percentile

The cyclically adjusted price-to-earnings ratio, commonly known as CAPE,[1] Shiller P/E, or P/E 10 ratio,[2] is a valuation measure usually applied to the US S&P 500 equity market. It is defined as price divided by the average of ten years of earnings (moving average), adjusted for inflation.[3] As such, it is principally used to assess likely future returns from equities over timescales of 10 to 20 years, with higher than average CAPE values implying lower than average long-term annual average returns. It is not intended as an indicator of impending market crashes, although high CAPE values have been associated with such events.[4]

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Jun 19

USO: Trading in an Up Trend Channel

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USO continues its up trend in an uptrend channel. The US Oil ETF recently rebounded from the 61.8% Fibonacci Retracement level after showing a Bullish Kicker reversal candlestick. Current USO price at $11.66 is just above the 200D SMA of $11.65.

USO June 19-2016

  • Immediate resistance at $12.47
  • Immediate support at about $11.13 followed by $10.52
  • 20/40EMA, 20/50 SMA all trending up
  • Expect golden cross 50D/200D in next few trading days if USO stays above $11.13 support.

See previous USO chart and technical analysis here.

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