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Will the gold price continue to break through 1940 line upward?On March 16th, a large U.S. bank injected US 30 billion into First Republic Bank to rescue the bank from the widening crisis.Previously, Credit Suisse said it would borrow up to US554 billion from the Swiss National Bank to boost liquidity.The market's worries about the banking crisis in Europe and the United States have cooled, and the global stock market has generally risen. Investors need to beware of the short-term volatility and pullback of gold prices or even the risk of peaking. In addition, the European Central Bank still raised interest rates by 50 basis points on Thursday.It is expected that the Fed will raise interest rates by 25 basis points at the March policy meeting, which will be slightly bearish for gold prices in the short term.Of course, the current risk-averse sentiment in the market has not completely subsided, and there are still certain safe-haven funds still pouring into the gold market to provide support for gold prices. From the trend point of view, the top of the short-term gold level is basically all around 1930, and this position is firmly established.The 4-hour-level trend has continued to rise and fall. It is currently temporarily under pressure in the 1935 area. At present, there is a certain degree of deviation from the K-line and there are signs that it has begun to gradually fall below the short-term moving average, and it tends to be able to make a certain degree of adjustment in the short-term trend.On the hourly level, the current range compression is relatively small, and the technical pattern has also begun to gradually weaken, but the overall performance of gold is still relatively strong. At present, the overall range is wide in the 1900-1940 range. In the short term, pay attention to the support in the 1910 area, and pay attention to the resistance of 1935 above. In order to facilitate everyone to continue to follow up on my analysis and sharing, you can like and follow me; in addition, I will share the daily real-time strategy in the channel. If you can't follow up in real time, you may make operational errors.You can use the following methods to enter my channel for free to follow the latest news and follow up on market trends in real time.
OANDA:XAUUSDLong
by Short-term-king
3
The SVB Collapse and Why It Matters To YouInteresting situation with the collapse of SVB (SIVB), the people have yet to realize we control the market not the central planners. and the collapse of SVB is a realization of that power. So , here is what i know from the very little articles and podcasts that I listen to and I will give you guys the why its important. From what i know is that SVB business model was somewhat risky in the first place, and their main consumer base was startups, and tech startups. hence the name Silicon Valley portion of Silicon Valley Bank. Now a little money education... in the world of money and currency (remember currency as current it will become important later) there is a concept called the velocity of money, basically the volatility of money. for my stock traders think the VIX. when the VIX is low there is no money to be made because money is not moving. but when the VIX is high there is plenty of money going around so why not use your dollars as napkins, right or "fun coupons"! this is the velocity of money the faster a person can make money move the more money they stand to make. the banks know this. So when you go to the bank and deposit your check your money is already out the door into something else before you're able to but your wallet in your bag or pocket. this happens because of what is called as the "fractional reserve system" and to be honest its a "F"ed up idea but has worked thus far. what this system means for every dollar you put into the bank, the bank can lend out 10$. A bank is a business it makes its profits by lending money, and when you save your money it cost the bank money, because of your .01% interest rate. the reason for the big push for open accounts is because the more open accounts the bank has means the more money they have liquid, which means the more they can loan out, which means the more they stand to profit. now as an insurance policy the US government makes the banks keep a fraction of their total account balances on site incase of what they call a "bank run" happens (get to what a bank run is later) Now, normally you dont notice this or even care because when you go to the bank and want to pull 100$ from your account its no big deal whats a 100$ when your dealing with 100s of thousands. you want a 100$ you get 100$ instantly. But want to see the system become a problem for you, if you have more than lets say 25,000$ or more in an account go try to pull ALL that money out and see what type of road blocks you encounter. they will make you give ID, reasons for shutting down the account, basically your first born child and your blood type. partly is because they really want to know why you're closing the account, because thats profits walking out the door. but the main reason is, they have to reach out to sister branches and other banks to pool that money together to be able to give it to you and this typically happens like over night. so if you think you're about to waltz into your local bank and demand a 25,000$ check right then and there you're sadly mistaken. the same exact process happens when you take out a mortgage, now your talking $200K and up so now there are more road blocks. whether you're the buyer or the seller. you sell your house for 500K and you think that check you deposited is there right when you get it... yeah its not! back to the currency comment money is now a currency it has to keep moving to keep its value. think of it as a river, mostly you can drink water from a river and be okay because bacteria cannot grow in moving water but drink water out of a pond and you just might catch Syphilis (sarcasm intended). money is the same way, the faster you can make it move the more you stand to make and the healthier the money is, if take money out of the river and stick it in your pond as a savings account inflation will eat it alive making it very unhealthy. Even historically before all this crazy inflation started happening the savings rate in a savings account was like 0.01% and inflation was around 2 percent. Now the importance of this lays with the SVB. When looking at their business model it seems solid... "invest in high beta companies, or higher risk endeavors, then to off set this risk we will load up on the safest paper assets money can buy... the US 10Y bond." Officially the US hasn't defaulted on loans before... i mean we will print more money before we default. I mean it sounds like counterfeiting if you ask me, but who am I just a low key, low level, low volume trader with a computer living in my moms basement :) sarcasm... or is it?! Well from the looks of it it would seem SVB bought a ton of these 10Y bonds in 2021 when the economy was ripping and roaring. So, when bond yields are down their prices are way up. So in the full swing of the "roaring 20's" yields were around 1.12X or keeping it simpler 1.1XX. so that must mean the value must of been sky high. My only rational thought for this type of purchase was the risk manager must of thought he could off load the bonds in the bond market for a nice profit thinking good times were going to continue. On the surface it seems okay high risk business model with a low risk counter weight. But "We the People" were leaving SVB, and going back to what i said about taking your 25,000$ savings out, and they were running out of reserves and their bonds were worth less than the paper they were "printed" on, so they filed a loss on their report. on the surface this was fine, because only die hards read a companies 10Q or 8A but all it takes is one... and there is always that one Guy... and not this Regular Guy either. I personally dont like the instability of the tech industry. i mean i do believe we will make a full blown terminator but i dont want to gamble on which company that is regardless of what the gain is... might as well go gamble in my opinion. So, because there was a mass exodus of accounts they were having a hard time fill orders so file your 8A detailing you're offering more stocks to drum up some money and it falls flat. people read said 8A and see that you dont have cash so the word got out and the consumers made a bank run. Dont get it twisted either this can happen to any commercial bank JP Morgan, BofA, Chase, Citi, Credit Suisse and the like. a bank run is when the majority of depositors want their money back now and they do it in close succession of each other forcing the bank to say "we dont have your money" so they in essence "run" to the "bank" to get their worthless paper. Now, what i just learned is back in '08 our amazing government passed legislation basically stating they will no longer bail out banks. (honestly if you guys know the piece of legislation please post it in the comments) I agree with this legislation because when I lost 15k on a bad USDCHF trade 7-8 years ago the government didnt bail me out. that was all my money... just gone in a matter of seconds. So the US government came out and said " we will make sure all depositors will get their monies back... How? step in Bail-Ins And again a bail in is something i literally just learned about... i swear at this point were just making -ish up at this point... ok so we know what a bail out is... basically the US government funnels all this cash into a failing business(s) and the tax payer picks up the tab. so what is a bail-in?... glad you asked a bail-in is when the depositors pick up the tab... How? well the FDIC picks up the first $250K and anything over that 250K is now funneled into bank to help offset the loss. so if you have $500K in the bank the first $250K is yours... uncle sam gives it back via FDIC (which that money has been long gone spent, so i dont know where theyre going to pull money from to keep this facade of the FDIC up) and the next $250K is the banks... So congratulations you have just become a unwillingly silent partner of a failing bank. -ishy news is that the current administration is trying to give more power back to the IRS and bring it back to its glory days like it was in the 80's so you wont be able to claim those losses on your taxes, if you had a business friendly administration you might actually have a fighting chance. i have a feeling the whole world is watching what is about to happen, because the entire banking system relies on high value accounts. if the US says tough luck that might send uneasy shock waves to all the high income earners and might make them want to pull their funds out of the banking system... there is a very interesting article on Credit Suisse that i want to read so ciao!
TVC:US10Y
by ARegularGuy
1
Momentum vs Business Valuation"The momentum guys take it up to the moon, the value guys pick it up off the floor. Just watch out for the space between the two." -Confucius the trader have been reading up on the Turtle Traders and their momentum strategy. They would have bought anything as long as it meets their break out rules. Fascinating statistical strategy based on both 20 period price action and 55 day price action. Im sure they love the action in NVDA right now. However, in the valuation books. The oldies but goodies books (Intelligent Investor by Benjamin Graham, Beating the Street by Peter Lynch) they would be less enthusiastic about the current valuation. Most useful would be Peter Lynchs PEG ratio, where growth rate is used to allow paying a higher price than normal for growth stocks. The roughly 30% growth rate annual expectation in this case would mean if NVDA falls below 30pe, it would be attractive. Its almost twice that now. Thats not necessarily a reason to sell a quality stock. it just means that investors have already market up the stock and are buying it ahead of the future growth being expected. In this case, 2026s future growth. Traders gonna trade. They dont care about the future value of a stock. they care about Profit this week or this month and then on to the next one. however the investors do care. They are looking for getting a deal on something that can swell up with earnings and juicy future value dividends. Investors want a discounted price today, and 20 years of accumulated earnings so they can milk the future dividend payouts. Any who, just watch out and be aware. Its a fast horse, its also a popular one.
NASDAQ:NVDA
by optionfarmers
The pound rebounded as scheduled, can the bulls recover?On Wednesday (March 15), GBP/USD continued to fall by 0.85% to close at USD1.2056.The UBS incident has caused the market to worry about the state of the European banking system, because the impact of the collapse of Silicon Valley Bank, which is a major customer of technology companies in the United States, is accelerating.Credit Suisse's share price plunged by more than 30% at one point, after its largest investor said it could not provide the bank with more financial assistance.The stock's plunge led to a decline in the broader European banking stock index, triggering demand for safe-haven dollars and forcing investors to avoid high-risk currencies such as the British pound.However, the market believes that the eurozone market may be hit first, while the British market is slightly protected, so at this stage, the performance of the pound is slightly stronger than that of the euro.Subsequently, British Chancellor of the Exchequer Hunt announced a fiscal plan. Fiscal measures for this year and next two years will cost 94 billion pounds, demonstrating the British government's determination to boost economic growth and avoid recession.This has helped limit the decline of the pound to a certain extent. On the trend of GBP/USD, it was mentioned in the article yesterday that if the 1.201 position can be supported, it is possible to carry out a short-cycle restorative rebound on this basis.It is currently trading near the level of 1.211.From this point of view, there is still strong support near the 1.201 level below, but the current trend is still volatile and the trend is not clear.The overall volatility range is still limited to between 1.1930-1.22. In order to facilitate everyone to continue to follow up on my analysis and sharing, you can like and follow me; in addition, I will share the daily real-time strategy in the channel. If you can't follow up in real time, you may make operational errors.You can use the following methods to enter my channel for free to follow the latest news and follow up on market trends in real time.
Long
by Short-term-king
RISK MANAGEMENT STRATEGIES There are several risk management strategies that can be used to help mitigate potential losses and increase the chances of success in any investment or trading endeavor. Here are a few common risk management strategies: Diversification is an essential risk management strategy that involves spreading your investments across different markets, asset classes, and securities. The goal of diversification is to reduce the overall risk in your portfolio by minimizing the impact of any single investment or market on your portfolio. When you diversify your portfolio, you spread your investments across different asset classes such as stocks, bonds, and commodities. You also diversify across different markets, such as domestic and international markets, and across different sectors, such as healthcare, technology, and consumer goods. By diversifying across different asset classes, markets, and sectors, you can help balance out potential losses in any one area. For example, if you have all of your investments in the stock market, you are vulnerable to a significant loss if the stock market experiences a downturn. However, if you have some investments in bonds or commodities, those investments may perform well during a market downturn, helping to offset your losses in the stock market. Additionally, diversification can help you take advantage of opportunities in different markets and sectors. For example, if the stock market is experiencing a downturn, other markets, such as commodities or international markets, may be performing well. By diversifying your investments, you can take advantage of these opportunities and potentially improve your overall returns. It's important to note that diversification does not guarantee a profit or protect against loss, but it can help reduce the overall risk in your portfolio. However, diversification requires careful planning and ongoing management. You should regularly review your portfolio and make adjustments to ensure that your investments remain diversified and aligned with your goals and risk tolerance. Diversification is a critical risk management strategy that can help reduce the impact of any single investment or market on your portfolio. By spreading your investments across different markets, asset classes, and securities, you can help balance out potential losses and take advantage of opportunities in different areas. Setting stop losses is a vital risk management strategy that involves setting a predetermined price point at which you will sell a security to limit potential losses on any given trade. Stop losses are commonly used by day traders and other active investors to protect their portfolio from large drawdowns and minimize potential losses. The concept of a stop loss is relatively simple. When you buy a security, you set a price point at which you are willing to sell the security if the price drops to a certain level. This level is known as the stop loss level. If the security's price reaches the stop loss level, the security is sold automatically, limiting your potential losses. The main benefit of using stop losses is that they allow you to manage risk effectively. By setting a stop loss, you limit the amount of money you can potentially lose on any given trade. This can help prevent large drawdowns and protect your portfolio from significant losses. Stop losses are also valuable because they help you avoid emotional trading decisions. When you have a predetermined stop loss level, you can take the emotion out of trading decisions. This can help prevent you from holding onto losing trades for too long, which can result in even greater losses. However, it's important to note that setting stop losses is not foolproof. In fast-moving markets or markets with low liquidity, a stop loss order may not execute at the desired price, resulting in losses greater than expected. Additionally, setting stop losses too close to the market price may result in the order executing prematurely, potentially missing out on gains. Setting stop losses is an important risk management strategy that can help protect your portfolio from significant losses. By setting a predetermined price point at which you are willing to sell a security, you can limit potential losses and avoid emotional trading decisions. However, it's essential to use stop losses carefully and adjust them as needed to ensure that they are aligned with your goals and risk tolerance. Position sizing is an important risk management strategy that involves determining the appropriate amount of capital to allocate to each trade based on the level of risk involved. Position sizing is critical because it helps you manage the risk in your portfolio and avoid overexposure to high-risk positions. The idea behind position sizing is to ensure that the amount of capital you allocate to each trade is proportionate to the level of risk involved. For example, if you're taking on a high-risk trade, you'll want to allocate less capital to that trade to limit the potential losses. Conversely, if you're taking on a low-risk trade, you may allocate more capital to that trade. Position sizing can be calculated in various ways, but the most common method is to use a percentage of your account balance for each trade. For example, if you have a $100,000 account and you decide to risk 2% of your account on each trade, you would allocate $2,000 to each trade. By carefully managing position sizing, you can limit the impact of any single trade on your portfolio. If you allocate too much capital to a single trade, you run the risk of losing a significant portion of your portfolio if that trade goes wrong. On the other hand, if you allocate too little capital to a trade, you may miss out on potential gains. Position sizing is also essential for avoiding overexposure to high-risk positions. If you have too much capital allocated to high-risk trades, you run the risk of suffering significant losses if those trades go wrong. By carefully managing position sizing, you can ensure that you have a well-diversified portfolio with appropriate levels of risk. Position sizing is a critical risk management strategy that helps you manage the risk in your portfolio by determining the appropriate amount of capital to allocate to each trade based on the level of risk involved. By carefully managing position sizing, you can limit the impact of any single trade on your portfolio and avoid overexposure to high-risk positions. The risk-reward ratio is an important risk management tool that can help you make more informed trading decisions. The ratio measures the potential return on investment against the amount of risk involved in a particular trade. By focusing on trades with a favorable risk-reward ratio, you can increase your chances of success and limit potential losses. The risk-reward ratio is typically expressed as a ratio of the potential reward to the potential risk. For example, if you're considering a trade where the potential reward is $2,000 and the potential risk is $1,000, the risk-reward ratio would be 2:1. A favorable risk-reward ratio means that the potential reward is greater than the potential risk. By focusing on trades with a favorable risk-reward ratio, you can increase your chances of success. This is because you're only taking on trades where the potential reward outweighs the potential risk. This means that even if some trades don't work out, you can still make a profit if the majority of your trades have a favorable risk-reward ratio. One of the benefits of the risk-reward ratio is that it helps you avoid emotional trading decisions. By focusing on the potential reward relative to the potential risk, you can take the emotion out of trading decisions. This can help prevent you from taking on trades with too much risk or holding onto losing trades for too long. It's important to note that a favorable risk-reward ratio doesn't guarantee success. Even trades with a high potential reward relative to the potential risk can still result in losses. However, by focusing on trades with a favorable risk-reward ratio, you can limit potential losses and increase your chances of success over the long run. The risk-reward ratio is an essential risk management tool that measures the potential return on investment against the amount of risk involved. By focusing on trades with a favorable risk-reward ratio, you can increase your chances of success and limit potential losses. It's important to use the risk-reward ratio in conjunction with other risk management strategies to ensure that you have a well-diversified and balanced portfolio. Staying informed is an essential risk management strategy for day traders. It involves keeping up-to-date with the latest news and developments in the market, both on a macroeconomic level and for individual securities. By staying informed, traders can identify potential risks and opportunities and adjust their trading strategies accordingly. There are many ways to stay informed as a day trader. One of the most important is to keep an eye on financial news sources, such as Bloomberg, CNBC, and The Wall Street Journal. These sources can provide valuable insights into market trends, company news, and other factors that can impact your trades. Many day traders also use social media, such as Twitter and Reddit, to stay informed about the latest news and trends in the market. Staying informed also means staying up-to-date on changes in regulations, economic indicators, and other macroeconomic factors that can impact the market. For example, changes in interest rates, trade policies, or fiscal policy can have a significant impact on market performance. By staying informed about these factors, traders can adjust their trading strategies accordingly and make more informed trading decisions. In addition to staying informed about the market, traders should also stay informed about their individual securities. This means monitoring earnings reports, company news, and other developments that can impact the price of a particular security. By staying informed about individual securities, traders can make more informed decisions about when to buy, sell, or hold a particular security. Staying informed is an essential risk management strategy for day traders. By staying up-to-date on the latest news and developments in the market, traders can identify potential risks and opportunities and adjust their trading strategies accordingly. Staying informed involves monitoring financial news sources, social media, macroeconomic factors, and individual securities to make more informed trading decisions. Overall, effective risk management involves a combination of these and other strategies, as well as careful planning, discipline, and a commitment to a sound trading strategy. By using these techniques and remaining focused on your goals, you can better manage risk and increase your chances of success in any investment or trading endeavor. STAY GREEN
AMEX:SPYEducation
by UnknownUnicorn37963351
Interpreting the Silicon Valley Bank Incident After the COVID-19 pandemic in 2020, the Federal Reserve used monetary policy to fight the pandemic, and household savings deposits reached about $1 trillion, with broad money M2 growing by over 25%. Many people were bullish on the US stock market, believing that these huge amounts of idle cash would one day enter the market as stocks. Obviously, many people forgot the double-entry accounting principle - for every credit, there must be a corresponding debit. For Silicon Valley Bank, with deposits of over $100 billion, all of its depositors are the largest and bluest venture capital companies and technology newcomers in Silicon Valley, including Peter Thiel's Founder's Fund. Since the Federal Reserve interest rate is zero, they bought the world's safest assets - short-term US bonds, and even earned some interest. However, the good times did not last. By the end of 2021, US inflation began to soar, and the Federal Reserve's monetary policy began to lose control, causing short-term US bond yields to soar, leading to the biggest US bond market crash in over 200 years in 2022. Suddenly, the world's safest asset became the storm's eye, and the US bond holdings in Silicon Valley Bank's account began to bleed. Even if they haven't sold yet, accounting requires mark-to-market valuation. The Silicon Valley market price loss has exceeded its total equity. Rating agencies wasted no time in preparing to downgrade Silicon Valley Bank's rating. However, deposit rates remain close to zero. Americans don't want to be harvested like this, so they began to withdraw their bank deposits and buy money market funds that now yield nearly 4%. If Silicon Valley Bank significantly raises its deposit interest rates, its interest margin income will be reduced, and it will have to pay additional liquidity. At this time, Silicon Valley found itself in a dilemma. Investment bank Goldman Sachs saw commission opportunities and began to suggest that Silicon Valley sell part of its US bond portfolio and sell $2.25 billion of its stocks to replenish capital. This idea was really bad: data disclosed during the roadshow showed that Silicon Valley's customers were withdrawing large sums of money, causing a significant loss of deposits. If it weren't for the roadshow disclosure, the market wouldn't know the details. Now, the market believes that Silicon Valley is about to go bankrupt, accelerating the run on the bank. Since Silicon Valley's customers are all big clients with deposits far exceeding $250,000, more than 95% of Silicon Valley Bank's deposits are not covered by the US deposit insurance limit of $250,000. There must be many other regional banks using similar methods for cash management. Today, they are bound to face the same risks as short-term US bond yields soar. This also explains why the market unilaterally believes that the Federal Reserve will soon stop raising interest rates. Their actions determine their fate. Of course, the Federal Reserve's monetary policy must now consider the impact on the US banking industry. Chairman Powell has recently been saying that he needs to "consider the totality of data." Last night, the market hid in the short-term US bonds out of safe haven demand, causing yields to plummet. Many people continue to be indifferent to the historic inversion of the US bond yield curve. In fact, the inversion of the yield curve is a distortion of risk, which is not sustainable. Its reversal will cause a cataclysmic event. Although long-term risks are stable, short-term risks are high. We need to survive the short term to see the long term. "But such long-term predictions are of no use for the present. In the long term, we are all dead. Economists have it too easy, because their work is useless. At the onset of a storm, economists can only tell us that the storm will pass, and that the ocean will be calm again." - Keynes Now, the global market is concerned: Will Silicon Valley Bank be rescued? Many experts believe that if the US regulatory authorities do not intervene, Silicon Valley will become the second Lehman, which will bring down the US financial system. The market needs to see three measures for rescue: 1) Small depositors with less than $250,000 should receive full payment; 2) Depositors with deposit insurance limits over $250,000 should receive partial payment, and it should be ensured that in the future, depending on the sale of Silicon Valley Bank assets, these large depositors can receive most of their payment (such as 80%); 3) Let one of the four major US banks take over Silicon Valley Bank. The problem now is that less than 3% of Silicon Valley Bank deposit balances are below $250,000. Others are large and blue, including Silicon Valley venture capital companies such as Sequoia Capital, Paradigm, a16z, and GGV Capital. Many Silicon Valley companies involve funds ranging from hundreds of millions to tens of billions. No wonder Silicon Valley was squeezed for more than $40 billion before being taken over. Under such pressure, almost no bank can survive. Unfortunately, US law may not allow it. If the Federal Reserve intervenes, the Silicon Valley crisis must meet the definition of "systemic risk" and there must be "broad-based" risks, and it cannot only benefit a particular company. At the same time, the Federal Reserve cannot intervene in bankrupt companies that have already been taken over. The US Treasury cannot use unlegislated funds without congressional approval, and now there is no money left. In the end, it seems that FDIC has to bear the burden alone. The process of selling Silicon Valley assets to pay large depositors has already begun. It is reported that hedge funds have offered to buy Silicon Valley Bank's deposits at 60%-80% of their value. In times of crisis, Silicon Valley assets can be realized for 60%-80% of their value, and after the panic in the US market subsides, the price should be even higher. After all, US Treasury bonds trade up to $650 billion every day. Will the Federal Reserve open the floodgates again because of Silicon Valley Bank? In fact, Silicon Valley's bankruptcy is precisely due to the Fed's unbridled printing of money, which caused a sharp drop in US bond yields and a surge in savings deposits. If money is printed again using Silicon Valley as an excuse, the Fed's only remaining credibility will be gone. When Lehman collapsed, its assets were worth $640 billion, and its associated derivative contract amounted to trillions of dollars. It was indeed a decisive moment. However, the assets of Silicon Valley Bank this weekend were only $220 billion, and it still held a large number of highly liquid US Treasury bonds. Previously, the market believed that the US economy would not decline, but the Federal Reserve's decision to slow down the pace of interest rate hikes, and even stop them soon, made the combination of economic and policy expectations logically hard to convince. During this cycle of rate hikes, Federal Reserve officials maintained a dovish stance until the end of 2021, believing that inflation would be a "transitory, temporary phenomenon." They then changed their tune in 2022, saying that this round of inflation will be "higher and longer." In both recent history and ancient times, the Federal Reserve's forecasting record seems to be lacking. Overnight, the two-year US Treasury yield skyrocketed by more than 5%, the first time since 2007. The degree of inversion of the US Treasury yield curve is the most severe since 1981. Many people mistakenly believe that the inverted US Treasury yield curve is terrifying. In fact, it is more terrifying when the yield curve returns to normal from inversion because this is the moment when the US economy officially enters into a recession. Follow me and you'll get more interesting investment information! Plus, I'll share real-time trading strategies during trading hours, including stocks, gold , crude oil , forex, cryptocurrencies, and more!
S
by EagleEyeStrategy
2
What impact will there be after bankruptcy for SVB? The main reason for SVB's problem this time is liquidity. The banking industry is different from other industries, where the importance of liquidity is far greater than profitability. In the past few decades, there have been too many banks that have experienced extreme risks due to liquidity issues, and SVB has fallen into the same trap. The management was aware of the bankruptcy, as the CEO cashed out $3.6 million in stocks two weeks before disclosing the losses. The exaggeration was that a few hours before the announcement of bankruptcy, the company still distributed bonuses for 2022 to its employees. It is a stark contrast between those who received the bonus and thinking about how to spend it, and those who cannot withdraw their deposits and are worried about the situation. The market is concerned about the possibility of systemic risk and a Lehman-like crisis. As discussed earlier, based on the data, the liquidity risk of large banks is manageable, and the Federal Reserve is providing a backstop. However, there are around 5,000 banks in the United States, and more than just SVB may face liquidity risks in a high-interest rate environment. (Based on the data, there is a significant amount of unrealized losses for the four largest banks in the United States. The risk depends on the ratio of "hold-to-maturity investments/total liabilities." The ratios for the four banks are 22%, 12%, 12%, and 17%, while SVB's ratio is as high as 47%. Overall, the risk appears manageable.) The bankruptcy of SVB has the deepest impact on technology companies, as Silicon Valley Bank was set up to provide financing to technology companies, so many technology companies also keep their cash in SVB. Many companies have already disclosed the amount of their deposits in SVB over the weekend, and the impact on the technology industry is indeed significant. In theory, the money in SVB is safe because the asset problem is not significant, but due to the mismatch of terms, it takes six months or even a year to pay, which is a huge pressure for some technology startups. Those who have started a business know that every day they wake up, they have to pay rent and salaries, and liquidity is the core support for company operations. Hedge funds in the United States have already begun to look for opportunities to enter this time-limited money-making opportunity. Today, a hedge fund proposed to buy the startup company's deposits in SVB at a price as low as 60% of face value. It is indeed taking advantage of the situation to buy at this price, and if the asset confirmation is no problem, the portion due in a year, which is a 5% discount rate, is highly likely to be recovered by more than 90%. The bankruptcy of SVB has had a significant impact on financial assets, and the US stock market has fallen for two consecutive days mostly because of this. The US bond yield has also fallen for two consecutive days, and the flight to safety sentiment is beginning to spread. In the final analysis, the reason for SVB's bankruptcy this time is the Federal Reserve's rapid rate hike. Many contradictions will be highlighted in a high-interest-rate environment. The United States may still be relatively stable, and the greatest volatility may be in Europe and emerging markets. The follow-up is to pay attention to whether there will be further impacts and the Federal Reserve's further actions. The Federal Reserve has confirmed that it will hold an emergency closed meeting of the Federal Reserve System Board of Directors at 11:30 am local time on Monday, and we await the outcome of the meeting. Follow me and you'll get more interesting investment information! Plus, I'll share real-time trading strategies during trading hours, including stocks, gold , crude oil , forex, cryptocurrencies, and more!
S
by EagleEyeStrategy
SVB: Announces bankruptcy! The situation at Silicon Valley Bank (SVB) is not particularly complicated. In short, they borrowed short and invested long, mismanaged their liquidity, and caused their own demise. The specific steps were as follows: low-interest deposit-taking, overzealous investment in Mortgage-Backed Securities (MBS), short-term liquidity gaps, forced selling of assets, and market panic. Low-interest deposit-taking: Between 2020 and 2021, due to the Federal Reserve's extended period of 0% interest rates, there was a huge financing boom in the tech industry, with a significant portion of cash flowing into SVB. SVB's deposit liabilities surged from $61.8 billion at the end of 2019 to $189.2 billion at the end of 2021, with interest rates on this portion of deposits only around 0.25%. Overzealous investment in MBS: With so much low-interest money, SVB naturally engaged in carry trade. Typically, banks focus on lending, but SVB invested a large portion of its funds in MBS. Their financial statements showed they held $13.8 billion of MBS at the end of 2019, which had grown to $98.2 billion by the end of 2021. In other words, over 65% of the deposits they took in went towards buying MBS. Short-term liquidity gap: Normally, investing in MBS is not a problem because they can be redeemed at maturity. But SVB's problem was that it held too many MBS and had too few short-term liquid assets. In today's high-interest rate environment, tech companies are struggling to survive and are gradually withdrawing money from their deposits, causing SVB's liquidity pressures to soar. Forced selling of assets: To solve the liquidity problem, management chose the cheapest option, which was to sell their MBS holdings. But now, market interest rates had increased from nearly 0 to 5% for 2-year Treasury bonds, and asset prices had fallen significantly in sync. Selling $21 billion of assets resulted in an $1.8 billion loss. Market panic: For SVB, the $1.8 billion loss was still manageable because their shareholder equity was $16 billion. However, the problem was with the $100 billion of MBS that they had not yet sold. If there was a run on the bank, this could result in a potential loss of $15 billion, causing SVB to go bankrupt. Therefore, there was a great deal of panic in the market, causing the stock price to plummet by 60% in a single day. SVB has now declared bankruptcy, and the US government has intervened. It is being managed by a specialized institution. When a bank of this size collapses, there are bound to be chain reactions. The institutions known to be affected include Circle. For those who invest in stocks, they may not have heard of it, but those who invest in cryptocurrencies certainly have, as the most famous stablecoin, USDC, is issued by Circle. The total amount is $40 billion, and in today's announcement, they revealed that $3.3 billion of their assets were stuck in SVB, accounting for almost 8%. This means that those who invest in cryptocurrencies suddenly find that their $100 has shrunk to $92. To say that it's a seismic event is not an exaggeration. There are likely dozens of institutions of a similar scale to Circle that are also trapped, but for various reasons, they are not disclosing their situation. We'll have to wait and see when they come forward. Follow me and you'll get more interesting investment information! Plus, I'll share real-time trading strategies during trading hours, including stocks, gold, crude oil, forex, cryptocurrencies, and more!
S
by EagleEyeStrategy
22
BROOKFIELD Analysis (BN)📝 1. Introduction Brookfield is a global asset company active in a variety of industries, including Renewable Power and Transition, Infrastructure, Private Equity, Real Estate, and Credit and Insurance Solutions. With approximately 180,000 employees in more than 30 countries, the company has an extensive network of investments and operations around the world. The correlation with the S&P 500 is close to 1:1 most of the time. Given the company's scope in several sectors, its size and its history, it is important to put it on the table when carrying out a broad market analysis. 🧾 2. Fundamental Analysis 🔴 Analyzing the aspect of operating results, net revenue has been progressively falling since March 2022. It is now practically at the same level as March 2020. This reflects on the Earnings per Share, which is not following the Estimated Earnings per Share, indicating a possible excess of optimism on the part of analysts. 🤔 Will revenue drop to the same level as in June 2020? 🔴 Free cash flow is on the same path, at the same level as in March 2020 as well. 🟢 Looking at the P/E ("Price/Earnings"), we can see that the share price has become more expensive in relation to its earnings, giving a balance from the end of last year. A higher P/E can be a result of a positive expectation for the company's growth. 🟢 The P/CF ("Price/Cash Flow") is signaling a recovery, indicating an increase in the share price in relation to its available cash, which may also corroborate an optimistic expectation for the company's growth. 🟢 Finally, looking at the Balance Sheet aspect, Shareholders' Equity continues on a constant upward trend, which demonstrates financial health. 🟡 Conclusion: Said that, I don't see any problem with this fundamentalist data. My only point of attention is regarding net revenue, which is at the same levels as the start of the pandemic back in 2020. Due to the increase in the cost of money, revenue may reach the same level as June 2020 or even worse. The X of the question is how much and when. 📈 3. Graphic Analysis A buy in the region between $30 and $31 after an upward pivot becomes more attractive, offering a good risk/return ratio: Another scenario that can develop, which is easier to visualize on the line graph, is a trading range within a triangle. In this scenario, I think the price would break below the triangle to capture the bulls' stops, and only then begin an upward movement.
NYSE:BNLong
by andre_007
Netflix Has Some Downside Risks- The new partnership with a major Australian studio bodes well for the company's ability to produce high-quality content. - Netflix's recent financials have left investors doubtful of its ability to turn a profit. - Netflix's high level of long-term debt is causing concern among investors. Competitive Advantage and Pricing of NFLX Netflix is a streaming giant that has seen tremendous growth in recent years. The company's earnings and revenue have consistently exceeded expectations, making it one of the most valuable companies in the world. Netflix's original content, such as "Stranger Things," "The Crown," and "Narcos," has been particularly successful in attracting and retaining subscribers. The company has also made strategic acquisitions, such as the purchase of the Animation studio “Animal Logic”. In addition to subscriber growth, Netflix's revenue is also driven by increasing prices. The company has raised its prices several times in recent years, and this will go into effect in 2023. This allows the company to generate more revenue per subscriber, which helps to offset the costs of producing and acquiring content. Despite the challenges posed by the COVID-19 pandemic, Netflix has been able to maintain strong financial performance. The company's ability to adapt to the changing market conditions and its focus on producing high-quality content have been crucial to its success. As the streaming market continues to grow, Netflix is well-positioned to capitalize on the trend and maintain its position as a leader in the industry. In terms of the competitive landscape, Netflix faces competition from other streaming services, such as Disney+, Amazon Prime Video, and Hulu. However, the company has established a strong position in the market and has a large subscriber base. If the company is able to maintain its position in the market and continue to produce high-quality content, it could bode well for its stock performance. Netflix’s Q4 Earnings Analysis In the last quarter of 2022, Netflix reported revenue of $7.85 billion, a 2% increase from the previous year. The company also reported earnings per share of $0.12, a significant decrease from the $1.13 reported in the same quarter of 2021. EPS had been forecasted as $0.36 and therefore it was below expectations. The main reason why Netflix was not able to meet expectations is relevant to F/X measurement on EUR-dominated debt. However, NetFlix was able to hedge volatility on EUR/USD currency pairs for their debt based on EUR. How they are dealing with this is that the company approximately has $5B of EUR bonds which provides them a natural hedge mechanism on the relative value of the EUR net income. The main driver of Netflix's revenue growth is its subscriber base, which has been steadily increasing. In the last quarter of 2022, the company added 8 million new subscribers, bringing its total subscriber count to over 231 million. This strong subscriber growth is a testament to the company's ability to produce and acquire high-quality content that keeps its users engaged. NetFlix had targeted an operating margin of 19%-20% based on F/X rates at the beginning of 2022. Currently, the company targets to deliver roughly 21%-22% operating margin in 2023. However, due to the timing content spend, NetFlix expects their operating margin to be down year over year (20% vs (25%). Overall, Netflix's earnings and revenue have been consistently strong, and the company continues to grow. The company's focus on producing original content, strategic acquisitions, and raising prices has helped to drive revenue growth, which will likely continue in the future. This puts the company in a strong position to maintain its position as a leader in the streaming industry. Regional Breakdown In the United States, Netflix has the largest subscriber base of any country, with over 60 million subscribers. This is due in part to the fact that the company was founded in the United States, and it has been able to establish a strong foothold in the market early on. In addition, the high penetration of broadband internet in the US has made it easier for Netflix to reach its target audience. In Asia, Netflix has faced more challenges in establishing a strong subscriber base. The company has had to contend with stiff competition from local streaming services, as well as cultural and linguistic barriers. However, Netflix has been able to make inroads into the Asian market by producing local content and making strategic partnerships with local media companies. In Latin America, Netflix has been able to establish a strong presence in countries such as Brazil and Mexico. The company has been able to build a large subscriber base in these countries by producing localized content and making strategic acquisitions of local media companies. In Africa, Netflix has faced some challenges in building a subscriber base due to a lack of broadband internet infrastructure and low purchasing power in some countries. However, the company has been able to make inroads in the African market by partnering with local media companies and producing localized content. Overall, Netflix has a strong global presence, but its subscriber base and financial performance vary by region. The company has been able to build a large subscriber base in the United States, Europe, and Latin America, but has faced more challenges in Asia and Africa. The company continues to expand its global reach and adapt to regional market conditions. Cashflow and Capital Structure Netflix's cash flow and capital structure are closely related to its overall financial performance. The company generates cash flow through its operations, which it uses to fund its growth and expansion. In terms of cash flow, Netflix has consistently been generating positive cash flow from operations. In the last quarter of 2022, the company reported cash flow from operations of $443.858 Million, which was a decrease from $556.810 Million. This cash flow is generated primarily through subscription revenue, which accounts for the majority of the company's revenue. Netflix's capital structure is primarily composed of debt and equity. The company has been using debt to finance its growth and expansion. As of December 2022, Netflix's debt stood at $14.3 billion, with the majority of it being in the form of long-term debt. In terms of equity, Netflix has been using a combination of internal funds and equity offerings to raise capital. The company has been able to raise capital through several equity offerings over the years, which has helped it to grow and expand its business. As the company continues to invest in content and expand its global reach, it will continue to generate positive cash flow, but it is also likely to continue to rely on debt to finance its growth. Overall, Netflix's cash flow and capital structure are closely related to its overall financial performance. The company generates positive cash flow from its operations, which it uses to fund its growth and expansion. Its capital structure is primarily composed of debt and equity, with the company using a combination of internal funds and equity offerings to raise capital. Technical Snapshot of Netflix 2022 was a devastating year for Tech stocks due to the high inflation rates and demand for commodities. These might be some reasons why Tech stocks were not shining in 2022, but it is undeniable the fact that there are always opportunities to benefit from in the market. Therefore, having evaluated NetFlix’s current earnings ratios and expectations, it can be said that the Pivot point at $300 will be a determinant of which way the stock tends to move. Final Thoughts I expect a high level of volatility and believe that the current tendency for commodities will be maintained through 2023. Therefore, some hedging strategies might be used for technology stocks to locate yourself on the safe side of trading through earnings seasons. Netflix has already reached its mature growth phase therefore the company needs to come up with new ideas, projects, or acquisitions that make everyone impressed. According to Netflix’s latest financial report, the current Price-to-sales ratio is 4.78 whilst It is 1.92, 2.20, and 1.20 respectively for Amazon, Walt Disney, and Warner Bros. After having analyzed financial reports and these terms, I would be “Bearish” on the stock. As always, do your due diligence on any stock before buying and selling. Happy Trading! :)
NASDAQ:NFLXShort
by UnknownUnicorn14317765
Where will CRM go today?As you might now, later that day CRM will publish their earnings. What is priced in in the options and what does that tell us? IV, IM - We have a very high Implied Volatility. The calculated Implied Move is 14.90 USD according to my data. Therefore the lower Zone is at ~148 and the upper zone is at ~178. This is a 9% move! - Remember the Implied Volatility is equal to one standard deviation. Therefor the chance is 68% that the price stays within the zone from 148 - 178 after earnings. PUTS - The number of Put-Options out-of-the-money compared to the Put-Option in-the-money is 91.59%. Remember, when Put-Options will be in-the-money at expiration they are assigned. Hence Option Traders speculate on a change of price and not want to buy or sell the underlying, you can safely assume, that the vast majority (91%) of all Option Traders believe, that the price will not drop any further. - The most traded Put Option price is at 150 USD. 46% of all traders believe, the price will not drop below 150 USD. - If the price would drop below 150, many shares will be assigned and bought at that price. Therefor, 150 USD will act as natural resistance. CALLS - Calls out and in-the-money are very even. There is no signal to recognize. - The most traded Call is at 157.50. Hence Calls become worthless when they are out-of-the-money at expiration, its safe to assume that 42% of all Option-Trader that buy Callls, believe the price will be above 157.50 USD. Summarize: - Resistance at 150 due to Put Options - Strong bullish signal Put Options (91% overall, above price 163.61 USD) - Bullish signal Call Options (42% believe above 157.50 USD) (all data is analyzed with the expiration day 3.3.23)
NYSE:CRMLong
by derMatzeImNetz
3
CVR Partners $UAN a deep value play for 2023NYSE:UAN A cheap fertilizer producer with strong fundamentals is a strong bet for 2023. Latest ER reported strong Revenue and EPS beats despite Russian fertiliser exports being at all time highs. MR Quarterly production was impacted by maintenance - this work has been completed and it is likely that production volumes will return to normal this coming quarter likely boosting revenues this year. Macro factors e.g. war in Eastern Europe will likely add uncertainty to the availability of fertilizer along key transport routes to western Europe as sanctions against Russia take effect - shipping routes from Turkey will likely be impacted. I expect this stock has 20% upside by end of 2023 excluding dividend.
NYSE:UANLong
by Bullish_On_Value
1
Google earnings todayGOOG Q4 earnings are today, 2/2 at 4:15pm. Alphabet Cl C (GOOG) reported Q3 September 2022 earnings of $1.06 per share on revenue of $69.09 billion. The consensus earnings estimate was $1.26 per share on revenue of $70.64 billion. Revenue grew 6.1% on a year-over-year basis. Here's a GOOG 1 week chart with the past 8 earnings reports PE, EPS, revenue, cash & debt data indicators. Plus 2/3, 2/17 and 3/17 expiry options data. Q4 December 2022 Consensus: EPS = $1.19 Revenue = $76.48B P/E = 21.7 Q3 September 2022: EPS = 1.06 miss -16.01% Revenue = $69.09B miss -2.20% Cash = $21.98B Debt = $26.63B Q2 June 2022: EPS = 1.21 miss -6.05% Revenue = $69.68B miss -0.16% Cash = $17.94B Debt = $26.43B Q1 March 2022: EPS =1.23 miss -3.67% Revenue = $68.01B beat 0.18% Cash = $20.89B Debt = $26.25B 2/3/23 expiry options data: Put Volume Total 17,149 Call Volume Total 30,081 Put/Call Volume Ratio 0.57 Put Open Interest Total 50,820 Call Open Interest Total 54,156 Put/Call Open Interest Ratio 0.94 2/17/23 expiry options data: Put Volume Total 5,472 Call Volume Total 19,575 Put/Call Volume Ratio 0.28 Put Open Interest Total 96,153 Call Open Interest Total 104,606 Put/Call Open Interest Ratio 0.92 3/17/23 expiry options data Put Volume Total 4,332 Call Volume Total 14,527 Put/Call Volume Ratio 0.30 Put Open Interest Total 156,883 Call Open Interest Total 224,859 Put/Call Open Interest Ratio 0.70
NASDAQ:GOOG
by Options360
2
Has Block Bottomed?Block was a prominent growth stock before and during the pandemic. Like most companies of that type, it fell sharply between late-2021 and late-2022 as interest rates rose. But now it may be showing signs of bottoming and potentially turning higher. The first pattern on today’s chart is last November’s high of $75.77. SQ broke above that level in late January and held it this week. Has old resistance become new support? Second, the 50-day simple moving average (SMA) is back above the 200-day SMA for the first time in over a year. That kind of “golden cross” may suggest the longer-term uptrend has grown more bullish. Third, the lower study features our 2 MA Ratio custom script. It uses the default settings of the 8- and 21-day exponential moving averages (EMAs). Notice how the fast EMA remained above the slower EMA during the latest pullback. Finally, SQ jumped on November 4 after earnings and revenue beat estimates. That may keep traders focused on the fintech with the next set of numbers due after the closing bell this coming Thursday, February 23. TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more. Important Information TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means. This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates. Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com .
NYSE:SQ
by TradeStation
5