I suspect you have very clear vision of the big picture which is always what i try and pick up as well
yes china is an issue and we seem to coming to a head post covid. i sold my consumer stocks leading into the fed week and it is easier to wait just here. i have often seem hammers leading into xmas and then it all miraculously recovers over xmas. early days in the final quarter and it is not over yet for 2021.
the charts are always the starting point but i then try and look at it all as a SWOT analysis which i know sounds silly
the charts always show the news in advance
last week during the Fed crisis the only contrarian buying i could see came into energy
todays headlines are army bought in to control UK due to petrol shortages. all due to covid staff issues and the end of brexit. the chart and volume showed it last week and here we are. will it continue into the weekly and monthly where the real gains sit? i dont know but we have not even started the northern winter yet.
china news impacts copper demand this year but china has real shortages of coal
so there is a current weakness in copper and others but they are not exactly crashing. the demand is still there. it is a real supply demand story until there are more mines and production. same with nickel and uranium. the macros may not move for awhile but there is support for the producers and juniors to get on with their projects ie mcr pan and many many others
I would encourage mums and dads like myself not to lose heart just here
oil and energy normally run over xmas with the northern winter. it is starting already in the UK and china which is unusual.
perhaps sit on cash and be ready but just dont turn your back on the market at the first real test since covid last year. we have had years of growth post gfc and now covid. i have seen a lot of retail mums and dads disappear over the years especially during the gfc and they have missed one of the most productive periods on the market post gfc and post covid.
the fed is now facing a debt crisis. i experienced the last one in the trump years. it all came to nothing. i was waiting for gold to run. no not a whimper.
likewise here i am watching the vix and the jpy both for signs of a flight to safety which should then follow through into gold and then goldies. again not a whimper from there here. so far the fed in the us seems in control
if the US economy turns sour they just have to announce they delay debt tapering. if the economy picks up then the tapering ends and interest rises. they really dont have to do much to control the economy. the only support i could see in the macros last week was energy
if we do have a black swan in october then i expect the normal v shaped hammer recovery
but so far last week was a bit of a non event. churn lower seems on the cards with a chinese UK USA led black swan hammer down before wall street and others start buying big again
but as usual we will see. there is more fed action underway this week with powell and yellen so we may see a change
cheers and thanks
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