DW8 Growth, page-14147

US markets rallied overnight based on lower core QOQ CPI figures. US Fed rate rises are already priced in for 0.5% June & 0.5% July.

US bond yields continue to decline & US Fed is expected to pause rate rises from August. Economists are now expecting the first rate cut about this time next year. Was going to be late next year for rate cuts but it has been moved forward. US rates will peak at 2% in a few months then rate cuts will follow mid next year. Another round of liquidity & stimulus on the way followed by illogical, unreasonable & irrational valuations to the upper end.

Nasdaq recent bottom was similar level to Covid bottom about 30% down. ASX XTX index doesn't have enough data to make similar comparison, however, using ASX XIJ index it also recently bottomed at similar levels to Covid. XIJ recent bottom was about 40% down whereas during Covid it bottomed down 42.5%. Market has behaved similar to the Covid crash but in slow motion. Took weeks to bottom during Covid compared to months during this bottom.

Looking at the DW8 chart the SP turned late December/early January & went from 4.5c bottom to 5.4c. Then the market sell off commenced mid January. If ASX XIJ index is down 40% then many small caps like DW8 would be down 50-80%. 2.3c / 5.4c = down 57.4% fits the current market conditions. Possibly some further weakness due to June tax loss sellers but should improve from July.

Looking forwards the quarterly expenses will come down below $5M from current $6M due to cost reductions & revenues will increase Q4 FY22, Q1 FY23 & Q2 FY23. Cash burn ratio will continue to trend down until break even a few quarters later.

DW8 at current lows reminds me of BRN at 4c. Now $1.08 even after recent retrace & I wish I bought another 500k. VMT was the same at 5c & now 40c. And BET at 2.5c & now 48.5c even after being hammered during market sell off.