Strange day - Euphoria mixed with CautionYes AGE lost 1 pip to finish on 5.1c. Our volume was on the lower side, similar to yesterday, just under 11m shares traded.
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ASX U stocks remained flat for the day. Of the 19 stocks that I track, there was no gain or loss.
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Overnight US U stocks were also flat. The ETF of URNM/URA remained flat, but some other U stocks had small gains/losses - 1 to 2%, so mostly flattish.. The U Future price inched forward, gaining another 15c to finish on $47.30
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What Next-
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So yesterday I had written that we will have a sideways movement. Although US markets were red, ASX played a sideways game. It was hovering around the zero mark, slightly ahead, but never able to break the shackles. Ultimately it finished slightly in the green. Google and Microsoft had decent earnings reports which pushed the US futures in green, and for us, it saved us from going into the red like US markets overnight.
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So why is my heading today - Mix of Euphoria and Caution? Reason being when I was tracking a number of stocks I could see there are clearly 2 games being played. There were many stocks which were treading with caution. That means they were not rising, slightly in decline, but no sell-off. So one set of stocks were in caution. The second set was in euphoria. Punters in a number of stocks were in very good mood. There was no concern or fear about tonight. Instead it seemed as if there is a party going on tonight. And some of those stocks marched ahead with glee. Lets see which set of punters were right.
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So we have finally reached the D Day many punters all over the world have been waiting for. There is a general consensus now that a rate rise of 0.75 will be in place. If the Fed come with that number, I expect no significant reaction in either red or green. The 0.75 rate has been talked about for quite some time and it will be no surprise. And if its not a surprise, it may be business as usual. But any other number, the only other possibility at this stage is 1%, it may have significant impact on markets. The Feds in general do not want to spook the markets. Last month for the rate rise, after moving from 0.5 to 0.75, there was a leak before the date and market expected 0.75. So if they were going for 1%, there is likely they may have taken the path of leak. So unlikely 1%, but its still on the table.
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Personally I was in great dilemma what to do. I have been calling about this rate rise for some time. My plan from few weeks back was to apply caution. I was very much tempted seeing the buoyance in some stocks. Many times I nearly bought stocks. In the end though, I went with my earlier plan. Last few weeks I had some good gains in my trading stocks. Mostly I have completed my trades which was around 50% of my funds. I thought I will have a look tonight before going. The way it is looking, we could have a good day tomorrow. But thought to give a miss of initial few percent and get in if there tomorrow for round 2 when there s more certainity. Lets see..So what will happen tonight? Google and Microsoft have given a good boost to US Futures tonight. Normally they are slightly in red or green at this stage, but they are good green at this stage. The Fed rate rise will come at 2AM our time, so markets should open in joyous mood. Asian markets were mixed. Few in green and others in red. The volatility index VIX has climbed slightly but not much - it has moved from 23+ to 24+, so punters are not panicking about tonight. The cryptos do not have a clear signal. Last few days they have lost close to 12-15. Bitcoin is just above 21k - they are now steady today - neither gaining or losing. So punters over there are not in euphoria, I can see caution there. Reason I write about cryptos is there are lot of punters/analysts sitting there and anticipating what's going to happen - it provides some market trends. Our friend Oscar though is in bear mood. He called for bear day before yesterday, the drop in US indices yesterday played as per their charts, and they feel the downtrend will continue. So its evident that there are no clear signal - US future euphoria, Cryptos caution, Chartists in bear mood. Its difficult to say what will happen. Much also depends now on what Fed says tonight, if 0.75 is given. My gut feel - initial reaction will be good and then sinking of the situation. So good tomorrow/bad Friday - but hopefully small to medium. Lets hope we get some good news and continue our bounce/recovery tomorrow. All the best
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