Friday, November 30, 2012

Market Update

The market didn't do much today despite some of the not so good news coming from the Fiscal Cliff negotiations. But the market continued to consolidate in a W4, so my assumption is another bullish wave is coming to test the 50 DMA earlier next week. Also, I posted the long term count chart I've been tracking for a few months now. Again, I don't trade based on long term wave counts but it is good for "situational awareness" should the market breakout of the long term Broadening Formation. If the market can rally past the all time highs, chances are prices will take off. What catalysts could make this happen, is anyone's guess at this time. Lastly, I am posting the HSI chart as that is where I am 100% invested and where my trip to Easter Island depends :) I could have sold few weeks ago when the RSI was over 70 but seeing that it was a W3, I took my chances in not selling. And now prices are very close to a break out for a W5, so we'll see if this wave will top in the 22600+ area as projected should the W4 low hold. Money is flowing into HSI due to the rebound in China and the very high dividends being paid so it is a matter of time before mainlanders realize what they have in front of them. It makes no sense that condominiums in mainland China sell for $500,000 (which have tripled in the last few years) while collecting a 2-3% yield on rent, while "red chips" stocks are yielding 5-6%+ and are at a 15 year valuation low (10.9 PE). As it is HSI will continue to rally but if China starts to rally, then we'll see a long term bull market there.

Have a Great Weekend!

Main S&P 500 Trends 

Short Term Trend = Bullish
Medium Term Trend = Bearish
Long Term Trend = Bullish

Long Term Portfolio

  • 100% Long in Red Chips traded in HSI (Mainland China stocks traded in Hong Kong).

Short Term Trading Strategy 
  • Bought 500 VXX @30.77 on 11/23/2012 - Closed @29..68 on 11/27/2012. = -1.09
  • Bought 500 VXX @31.54 on 11/20/2012 - Stopped out @31.11 on 11/21/2012. = -0.43
  • Closed position 500 @ 18.26 on 11/20/2012. Sold 500 @ 17.79, raised stop to break even on the other 500 as of 11/19/2012. Bought 1000 XIV @15.98 as of 11/15/2012 on margin - position trade cost improvement 4 cents, so net cost $15.94 as of 11/16/2012 - Profit = $2.05 
  • Bought 1000 XIV @16.88 as of 11/14/2012 on margin - Stopped out @ 16.66 on 11/14/2012. = -0.22
  • Bought 1000 XIV @15.67 as of 11/08/2012 on margin - sold 1000 XIV @ 16.25 on 11/12/2012 = +0.58
  • Margin positions in Gold initiated 11/06/2012.

No comments:

Post a Comment