Weekly Review U Stocks - 1st Jul 2022
Here is the weekly review figures and charts that I do every week. It is useful only for those interested in trading or those who hold multiple shares and based on performance would like to keep re-balancing as we go. As I have disclosed earlier I do hold a number of U stocks. This is the reason I include a number of other U Stocks in my analysis.
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Please note that all my analysis are from a trading perspective looking at short-term view.
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This week there is no Diary. I am adjusting my portfolio due to two reasons - first and mainly around end of finance year and secondly volatility that is happening in the markets. So having a lot of changes in my portfolio - one planned (EOFY) and second unplanned (volatility). As this is specific to my situation, I thought I will hold on sharing that for now. Hopefully back soon.
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There are no new additions this week. So the list contains 19 stocks.
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Are we at or close to bottom
- I did a lot of reading this week, but have not reached any conclusion
- After reading and watching a number of things, I feel at this stage nobody knows what's going to happen
- There are millions of data and thousands of charts - same data/chart is interpreted differently if one is a bear/bull
- Eg VIX - the volatility index is still decent around 26-27. The bears say that shows we are not near bottom as they expect high 30s. Bulls say that even after indices losing 20-30%, VIX says that we don't have much further to fall as punters are not worried
- We are also into new territory - like unprecedent first 6 months for some indices. So many chartists relying on previous behaviour do not have something to relate. Again based on bear/bull approach - both sides can make their points happily
- Overall though - more bears than bulls, including finance groups/brokers
- Conclusion - Individual to decide what to do. One thing we all do not want to be in - when the reversal happens, we are not left holding cash (buying/topping up) as we were waiting for some other signals or looking for it to go more down. It will never be possible to predict exact bottom, so close enough should be good. For people to take some risk, if they feel we are within 10%, start buying in tranches (like 3 to 4 lots to average out). If one is risk averse, wait for better sentiment - chances are that one may miss the first 10-20% of rise, but less chance of losing.
- Personally - After reading so much, I am more confused than before. Last week I said I would at this stage possibly try to day trade/short trade for a day or two with aggressive stop loss - I am thinking of continuing in that mode for now. Following week (from 11th) reporting season starts and we get CPI figures - I will wait for that unless we get some very good signals this week.
Something to keep in mind this week:
- Stocks are in constant decline after reaching new highs in April. Many stocks made their yearly lows
- This week though we had a gain of around 2%, first weekly gain after 4 weeks
- Many stocks have lost 60-75% from their recent highs. Its also true for US stocks. Many stocks have to rise around 120-150%% from here to recent highs
- U Future though after making lows of 46 and then second wave of 47, is inching towards previous high of $64.50, This week we finished at $51.25, a gain of $2.80 for the week from last week of $48.45.
- The reason U Spot price is important because we don't have good demand/supply figures, so it acts as proxy. Supply/demand is the biggest factor that will drive the bull run and still we don't have good figures. Hence the volatility, the turbulence, big drops.
- For the year now, average decline is standing at 28% now - sector has not done well till now. Only 1 stock is in green for the year - SLX
- Any special event/incident/catalyst can completely change the trading pattern - something to keep in mind
- Markets are still volatile and declining. Individual risk appetite and expectation should drive trading. The sentiment is poor, talks of recession high.
- There were some signs of decoupling from general market, but its not consistent. If we look back, it is very clear that there is practically no decoupling and if general market is on decline, there is a good chance we will decline
- The US markets on Friday was good, similar to a Friday week back.
- Prediction - Stocks will start strongly this week but at this stage I am not sure if the gains can be maintained. The general market will provide direction. Hopefully by end of week we are ahead of last week. - (This is exactly what I said last week, somehow it played that way)
Something Positive:
- U Macros still very strong - industry moving forward without any significant negative news, though not reflected in sp of stocks
- U Future price moving in the right direction with good gains of $2.80 over the week
- I did a lot of reading this week around general market conditions. Although lot of pessimism is still there, some charts are indicating that we are getting closer towards the bottom within the range of 10% - but pleas dyor as market is on decline
- Once the plateau happens, once the price gets above 200 day moving average, many punters will get in. This may still be few week or months away, but those optimistic - for sp to move above 200 dma (or lower moving averages first), sp decline should reduce from here and slowly catch up towards the line. But please dyor
- Though US indices lost 1 to 3% for the week, Friday indices were up around 1%. Signs of a reversal or another dead cat bounce? Pattern is turning out similar to last week
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Here is the Figures for the Week:
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(20min delay)
