CBA (ASX) CBA TA update

Originally posted by Launched: ↑

Look, I'd rather be invested in an Aussie big bank than a US regional bank right now.

Thing is, we are a global economy these days and knock on effects are more prolific now more than ever.

A quick example is when a market crash happens (not saying that's happening now - just an example) and gold crashes too.

Remember, gold is typically viewed as a safe haven (perhaps why it's up over the last couple of days) but when large positions are being liquidated then any collateral or other positions attached to the same holder will be liquidated to cover any losses.

So gold usually crashes with markets but usually does a good job at recovering.

All markets are connected - especially the banking sector

Or as an example for sector contagion, any lithium investors will remember what happened when all the Chinese spod converters seemed to mysteriously go down around 2018.

These were spod converters so should not have effected brine plays but $$ follow sentiment and lithium sentiment got floored - then prices followed.

CBA is now 14th biggest bank in the world by market cap - however it did just jump a couple of spots with Fridays dump on the US so that may change Monday.

*CBA just overtook SCHW as that bank alone lost 24% this week - and they were what's considered a 'big bank' so don't think we are immune.

CBA is less of a flight risk than the regional banks in the US but almost all money in the banking sector is attached one way or another.

Who would have thought all the big banks would be attached to crypto a few years ago but even our very own CBA took a small stake in Gemini in 2021.

Gemini has come out to say they are not directly involved with SIVB but if you look at what GUSD - their 'stable' coin - did over the weekend it highlights how well connected the financial system is.

Circle back USDC (a much bigger stable coin) and they have $3.3 billion tied up in SIVB (uninsured).

As I mentioned in previous post, I really don't know what effects the crypto side of things will have.

$3.3 billion may not seem much in the scheme of things when talking financials but that is supposed to back USDC. Many instos do have crypto positioning so the ripple effects may move more than just a few billion.

FYI at one stage USDC was down over 10% this weekend - that should not happen to a stable coin.

I have seen a number of S & P 500 components come out to say they held $$ in SIVB.

I don't think we've seen the full list yet or the knock on effects that these lost funds will have on other business that need to meet financial obligations.

These effects will knock on to all markets and if the banking sector is to blame then they'll cop the brunt of the losses.

The line ups out the front of other regional banks do not look great for a near term bank run.

So unless the FDIC and the Fed move quickly tonight there may be some major issues come Monday morning (US time).

So do I think contagion is a risk, yes I do.

Smart money seems to be one step ahead of the retail crowd, so go take a look at all Aussie banks charts over the past month(s).

Now tell me that's coincidence and tell me if you think we are not connected?

Been watching State Street coming and going from significant positions on Aussie banks lately - fair to say setting themselves up for a bigger move.

These guys are owned by Vanguard and Blackrock so don't think they aren't one step ahead of us mug retail punters.

May sound like I'm donning the tin foil hat now so once more, go look at a chart on any Aussie bank and tell me they didn't know this was coming months ago

The pump, the dump; this is a routine drill.

It's just a shame so many retail investors get chewed up and spat out in the process.

I've spoken a little about history and how similar scenarios played out back in GFC era and although I'm not expecting a carbon copy I do think we'll see similar action.

The GFC is another example of how the global financial system is connected. Back in 2010 both NAB and Westpac both tapped the Federal Reserve for funds and even our own RBA did.

We may be an island but we are still connected.

We've potentially seen most of the large initial move (although things could get a little crazy tomorrow if there is a bank run), so don't be surprised if we get a pump or at least markets hold tight for a few weeks once the initial dust settles.

If that plays out then we'll all be potentially gifted one of the best short set ups we'll ever see - but that's only my humble opinion so be sure to DYOR.

We are on the TA thread so if I get time later I'll post what I normally would here - TA.

Back in December I mentioned on this thread the most significant price to watch was $99.5 (I think we were trading around $106 then)

That price has been broken but nothing has changed - it's still significant.

Anyway all the best, trade safe and good luck which ever way you trade...

Expand

To be fair I think we got the January rally and then a few folk (me included) started positioning a little bit for the peak in rates coming sooner than expected.

Since then the rhetoric on rates has resumed to the extent that the Fed and RBA seem quite happy to crash their respective economies. Having gone too far on the stimulus they're now overshooting on the brakes. That's why smart and dumb money alike is cautious. It's like "hey, these guys really are prepared to trash the joint to make a point". Discretionary (retail and media) has been hit more than banks.

Regardless, I'm not sure how much money anyone buying CBA over $100 really could really have expected to make this year.

No.	Vol.	Price($)
6	4521	$185.36

No.

Vol.

Price($)

4521

$185.36

Price($)	Vol.	No.
$185.88	70	1

Price($)

Vol.

No.

$185.88

No.	Vol.	Price($)
1	15	185.360
18	4516	185.000
1	50	184.950
4	383	184.500
1	15	184.400

No.

Vol.

Price($)

185.360

4516

185.000

184.950

383

184.500

184.400

Price($)	Vol.	No.
185.880	70	1
186.090	50	1
187.000	300	1
187.400	5	1
187.600	58	1

Price($)

Vol.

No.

185.880

186.090

187.000

300

187.400

187.600

(20min delay)
Last $185.36		Change -5.350(2.81%)		Mkt cap ! $310.1B

Open	High	Low	Value	Volume
$190.50	$191.06	$185.36	$367.6M	1.971M

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