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Is Stock Market Recovery Possible? Trading Idea for 05/10/2023A unique situation has arisen in the market where the reward for the risk associated with stock investments is nearly equivalent to the yield on 10-year US government bonds. The prices of debt securities are steadily declining, and only a substantial collapse in the stock market can restore demand for them. Barclays' analysts share a similar viewpoint. However, there are currently conditions for a stock market recovery, especially if the unemployment rate in the US exceeds analysts' expectations. Therefore, our focus today is on the SPY ETF, which invests in companies comprising the S&P 500 index. On the D1 timeframe, resistance has formed at 430.30, with support at 420.12. If quotes consolidate above 425.01, this will likely trigger the beginning of an upward trend. Additionally, the price has moved closer to the 200-day Moving Average, which typically results in a rebound. On the H1 timeframe, the short-term target for the price increase is around 435.80, while in the medium term, it could reach 445.75. — Ideas and other content presented on this page should not be considered as guidance for trading or an investment advice. RoboMarkets bears no responsibility for trading results based on trading opinions described in these analytical reviews. The material presented and the information contained herein is for information purposes only and in no way should be considered as the provision of investment advice for the purposes of Investment Firms Law L. 87(I)/2017 of the Republic of Cyprus or any other form of personal advice or recommendation, which relates to certain types of transactions with certain types of financial instruments. Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67.85% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
AMEX:SPY
by RoboMarkets
10
ES1! & SPY: Happy October!Hopefully you all love Halloween and fall. Because I am obsessed and I went as extra as extra will allow. And you can expect this to continue until next month :p. Let's hope for a straight forward week this week. This would be for SPY to come up and reject 431. Remember, we have been rejecting that 431 repeatedly (which is our bearish condition on the 6 month) and have had 4 successful closes below it: If we break over it, its fine really. Because, as promised, we have 6 month levels on ES1! now and we can take a look at those here: Bearish condition on ES1! on the month is at 4486. So we can go back up there, we just need to reject there. Let's just hope it keeps it to the point with a rejection of 431. Its going to be bullish on Monday, probs agree and with the news catalyst of a government deal, its probably going to be excitable. But yeah, we need to just see rejection at 431 to see some continuation to the downside. It really should be swift, the move to the 6 month low targets, and then we see bounce and chop. It's usually how it plays out. But it could, technically and realistically, just chop its way down there. The velocity in tanking is not the same degree we had in 2022 where it was straight down, most of the time. There is a bit more bouncing here. Another thing of note, we missed the 99 on ES1! last week, which generally means the sentiment is overwhelming in one direction or another. In this case, that would be bearish. The last time ES1! missed a bullish 99, it tanked dramatically the next week, so of course be cautious here. I don't necessarily think that will happen this week, but it is a possibility. ES1!'s price targets for the week are listed in the chart above, for SPY, here they are: 99 this week is at the bullish condition on the week. So let's see what we get. That's it for now, I am bearish but obviously its contingent on us rejecting or staying below 431 on SPY. So let's see what happens with that, then we go from there. For Monday, I am bullish provided we open below 431. Will update as we see more!
CME_MINI:ES1!
by Steversteves
115
Yen Drops Below 150 Per Dollar - Exercise Caution in TradingThe Japanese yen has recently dropped below the critical threshold of 150 per dollar, primarily due to mounting concerns regarding intervention measures. In light of this situation, I strongly urge you to exercise caution and consider pausing yen trading until further clarification is obtained. The sudden decline in the yen's value has raised concerns among market participants, as it suggests the possibility of intervention by the Japanese government or central bank. Intervention refers to deliberate actions taken by authorities to influence their currency's exchange rate, typically through buying or selling large amounts of their own currency in the foreign exchange market. Such interventions can have a profound impact on the currency's value and create significant volatility in the market. Given the uncertainty surrounding the current situation, it is prudent to reassess our trading strategies and ensure that we are not unnecessarily exposed to potential risks. Therefore, I strongly recommend that you temporarily halt yen trading until we receive further guidance or clarification from reliable sources regarding any potential intervention measures. In the meantime, I encourage you to closely monitor the latest news and market developments related to the yen. Stay informed about any official statements or actions from the Japanese government or central bank, as these can provide valuable insights into the future direction of the currency. Additionally, consider diversifying your portfolio to reduce reliance on yen-based assets until the situation stabilizes. Please remember that our primary objective is to protect our investments and mitigate risk. By exercising caution and temporarily pausing yen trading, we can better position ourselves to navigate the current market uncertainties and make informed decisions when clarity emerges. If you have any questions or require further guidance, please do not hesitate to reach out to me or our dedicated support team. We are here to assist you and ensure that you have the necessary information to make well-informed trading decisions.
by bryandowningqln
11
BTCUSD: Long Position with a Target Price of 29221In the dynamic landscape of cryptocurrency trading, the BTCUSD pair has emerged as a focal point for investors seeking opportunities for growth and capital preservation. This analysis delves into the factors shaping the current trajectory of Bitcoin (BTC) and the US Dollar (USD) pairing, with an optimistic outlook projecting a rise to a target price of 29221. Underlying Catalysts: A Comprehensive Approach Growing Demand: The surge in demand for BTC is propelled by increased adoption and the growing interest of institutional investors. This heightened interest not only signifies a changing perception of cryptocurrencies but also establishes BTC as a sought-after asset. Inflation of the US Dollar: The recent injection of trillions into the US economy has triggered concerns about inflation. As investors seek refuge from potential devaluation, BTC emerges as a compelling alternative, acting as a store of value amid uncertainties. Technical Analysis: Technical indicators reveal a bullish trend, with the second re-test of the 4H diagonal resistance line solidifying the upward trajectory. Technical analysis, a pivotal aspect of market dynamics, augurs well for those eyeing a favorable position in the market. Market Sentiment: Positive market sentiment, buoyed by the US government's avoidance of a shutdown, has cast a favorable light on cryptocurrencies. As sentiment influences investor behavior, this positive outlook could be a driving force behind the upward momentum of BTC. Conclusion: Considering the combined impact of growing demand, concerns about US dollar inflation, positive market sentiment, there is a compelling case for a long position on BTCUSD. Technical analysis further supports the bullish outlook. Trade Parameters: Entry Price: After Bullish Reversal Confirmation around 27447-27062. Stop-Loss: Set below recent support levels to manage risk. Take Profit: Target price of 29221. Risk-Reward Ratio: Ensure a favorable risk-reward ratio by adjusting position size accordingly. Risk Factors: Market Trends: Monitor broader market trends for potential shifts. Economic Indicators: Keep an eye on key economic indicators, especially those related to inflation and the US dollar. Geopolitical Events: Any unexpected geopolitical events can influence market sentiment. It's crucial to conduct ongoing analysis and adapt the trade strategy based on changing market conditions. Always be aware of potential risks and use risk management tools effectively.
BITSTAMP:BTCUSDLong
by fardycurry
72
Navigating Rocky Oct After a Crushing Sept in US EquitiesSeasonality is pervasive in financial markets. Some are benign while others are not. The “September Effect” refers to a month when equity returns gets crushed. Typically, this is followed by a volatile October. Other well-established pattern in equity markets is the "Santa Claus Rally" which is known to occur during December. Equities go bullish with increased optimism, holiday spending, and portfolio rebalancing before the end of the year. Then, there is also the "January Effect" where small-caps tend to outperform large-caps in the early part of the year. Essential to remember that historical trends do not guarantee future performance. This paper delves into the September Effect followed by the volatility which tends to be witnessed during the month of October. Portfolio managers can prudently position their portfolios to gain from rising volatility and sharp price moves in October and the rest of the final quarter. WHAT EXPLAINS POOR EQUITY RETURNS IN SEPTEMBER? There is no exact rationale explaining why September is historically the worst month of the year for equities. Over the last 94 years, September is the only individual month that has declined at least 50% of the time. Scott Bauer, CEO of Prosper Trading Academy surmises in an opinion note that three drivers plausibly explains this: 1. Post Summer Vacation: In the lead up to summer in Europe, average trading volumes grind lower resulting in lower volatility from June to August. When portfolio managers and investors return in September, their collective rebalancing of portfolios cause panicked exits as they create space for new holdings. This mass-exodus of selling shares pushes prices lower making September the worst month for stocks. 2. Year-end for Mutual Funds: Many mutual funds close their fiscal year in September. These funds purge their portfolios during this ill-fated month. 3. New Bond Issuances: Like equity trading activity, bond issuances ease during summer and return with vengeance and spikes in September. New issuances channel existing money into bonds forcing investors to rotate out of equities and into bonds. SEPTEMBER US EQUITY MARKET PERFORMANCE IN THIS MILLENNIUM Does the September effect prevail in the current millennium? Since start of 2000, September indeed is the worst month for S&P 500 stocks with average returns of -1.8%. Surprisingly, the months with the highest occurrence of negative returns is not September but January. Over the last 23 years, January had 13 months of negative returns. June along with September rank second with 12 occurrences of negative returns during the same period. The chart below summarises average monthly returns of S&P 500 index. Clearly, on average, September stands out as a poor performer while April is the best . Interestingly, the S&P 500 shares tend to deliver positive returns with average upside performance of 3.22% in the fourth and final quarter of the year. Likewise for Nasdaq 100, the September Effect is even more pronounced with index plunging 2.61% on average. Unlike S&P 500, February (14 of 23) has the highest number of months with occurrence of negative returns. The month with the second highest occurrences of negative returns are September, June, and December with 12 of 23 years marking a negative return. The chart below summarises average monthly returns on the Nasdaq 100 index. While September crushes Nasdaq stocks, October is the best month thus far this millennium. October and November deliver positive returns with a pullback in December. On average, Nasdaq 100 upside performance stands at +2.44% in the fourth quarter. A CRUSHING SEPTEMBER IS FOLLOWED BY A ROCKY OCTOBER While September is the king of worst month for stock returns, October claims the crown for being the most volatile. Over the last 23 years, the S&P 500 equity returns show the largest exaggeration in October. Range as used below is defined as the high minus the low of the month and then expressed as a percentage as month’s opening level. Analysis shows that equity returns move by 9.1% in October compared to 6.9% on average for the rest of the months in the year. Similarly, observations in Nasdaq-100 also point to exaggerated range of returns during the month of October. Range in Nasdaq monthly returns stand at 11% in October compared to 9.2% on average for the rest of the months in the year. Based on expected returns and volatility, investors in S&P 500 can expect large swings in returns in October as evident from the chart below. Likewise, Nasdaq 100 investors can expect large swings in October returns based on observations over the last 23 years. OUTLOOK FOR FINAL QUARTER OF 2023 Twenty-three years of historical observations point to a positive upward bias in equity returns for the last three months of the year. This time however, the outlook going into the final quarter is beset with head winds. Not one but five of them approaching in parallel. Risk lurks in many places. Strong dollar. Oil skirting near $100/barrel. Resumption of student loan repayments. Record high mortgage rates driven by higher for longer policy stance. Automotive workers striking at multiple plants potentially leading to higher labour costs and automotive inflation. Dollar is trading at 10-month highs. The US 30-year mortgage rates at record high levels unseen in 23-years. The 10-year US yield are at levels last observed during 2007. Gathering of these dark clouds are starting to show up in the University of Michigan’s US Consumer Confidence index. Since June, American exceptionalism boosted the index to 71.73 clocking a 52-week high. However, with a raft of concerns weighing on the consumers, the index has started to drop the last two months. HARVESTING VOLATILITY EXPANSION USING CME MICRO OPTIONS ON S&P 500 AND NASDAQ 100 INDEX In times of uncertainty, where seasonality leans towards a bullish rally but fundamentals signal a bearish grind, portfolio managers can position to gain from volatility expansion and sharp index moves in either direction. Options can be used to engineer a convex portfolio. Convexity in finance refers to portfolio strategies which enjoy outsized and solid gains while limiting downside risks. Convex strategies deliver non-linear returns with substantially higher gain for every unit of pain. LONG STRADDLE USING OPTIONS ON CME MICRO E-MINI S&P 500 FUTURES Long straddles involve holding a simultaneous long call and long put position at the same strike price for the same expiration period. Let’s look at a hypothetic long straddle using Micro E-Mini S&P 500 Options expiring on 29th December 2023 at a strike price of 4400. The straddle pay-off is visualised in the chart below. This trade will generate positive returns when (a) index rises above 4655, or (b) index falls below 4145, or (c) volatility expands . The premium required for this trade (as of 2nd October 2023): (Premium for Call Option + Premium for Put Option) = (USD 631.7 + USD 636.65) = USD 1268.35. If index rises 10% to 4840: Call option would pay out ~USD 1568 = ((4840 – 4400) x 5 – Premium for Call Option) = (440 x 5 – 126.34) while the put option would expire worthless, so, net profit would be: (Net PnL from Call leg – Net PnL from Put Leg) = (1568 – 636.65) = ~USD 932 By the same measure, the long straddle will suffer losses if the index remains flat or its moves are muted. It also loses money if volatility remains flat or contracts. If index remains at 4400: Both options would expire worthless, so, the position would lead to a net loss of the premium paid = Loss of USD 1268.35. LONG STRADDLE USING OPTIONS ON MICRO E-MINI NASDAQ 100 FUTURES Let’s look at another hypothetic long straddle using Micro E-Mini Nasdaq 100 options expiring on 29th December 2023 at a strike price of 15250. The straddle pay-off is visualised in the chart below. This trade will generate positive returns when (a) index rises above 16416, or (b) index falls below 14084, or (c) volatility expands. The long straddle will endure losses if the index remains flat or its moves within a narrow range. It will also lose if volatility remains flat or shrinks. MARKET DATA CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
CME_MINI:MES1!
by mintdotfinance
12
Watch TLT Support at Multi-Decade LowsPrimary Chart : Monthly Chart of TLT Showing Multi-Decade Support Levels. A fair amount of charts have been published lately on the importance of interest rates, and conversely, long-term bonds, government or high-yield bonds. One well-known TradingView publisher @scheplick went so far as to describe the chart of the US 10-year yield as the most important chart for understanding financial markets in this season. His post was entitled, " The Most Important Chart in the World : TLT is an iShares ETF that tracks the performance, generally speaking of long-term US Treasury bonds. Specifically, iShares describes TLT as an ETF that "seeks to track the investment results of an index composed of U.S. Treasury bonds with remaining maturities greater than twenty years." TLT has been in a severe downtrend since March 2020. Bonds yields move inversely to price, and TLT represents, in a rough sense, the price of an index or basket of long-term US government bonds with maturities greater than 20 years. So if long-term bonds remain in a downtrend, then this corresponds to the uptrend in long-term yields that has continued to break higher than anyone expects. The Primary Chart shows TLT having reached long-term, major support at 2009-2010 lows. But a careful examination of TLT's recent lows reveals that it broke slightly below those lows, which isn't a good look for bond bulls in the long term. Supplementary Chart A shows 2009-2010 lows on a monthly chart (similar to the Primary Chart above). Supplementary Chart A However, TLT's reaching such a major support level, with a lower wick forming (at least initially), could imply a move higher in bonds and a concomitant move lower in yields in the near term. But remember that fighting a predominant trend (mean reversion) when it becomes extended can be one of the trades having the lowest success rate. But it can also have a higher reward rate if risk is managed well. SquishTrade does not recommend being long bonds here but rather commenting on how traders may react to major support levels in TLT's downtrend. They may be right or wrong—recall that no one likely expected long bonds to fall as far as they have, and many have been positioned long bonds since TLT was in the upper $90s! The next few supplementary charts emphasize the nature and severity of the downtrend in long-term bonds, as represented here by TLT. The first shows TLT's 200-day simple moving average (SMA). Price is about –12.11% below the 200-day SMA as of mid-session on Friday, September 29/ Supplementary Chart B Next, the VWAP anchored to TLT's long-term cycle high is shown in black. This confirms a long-term, and extreme downtrend in long duration US Treasury bonds. Long-term VWAPs do not always have such a noticeable downward slope. Even a bounce to $125 could present just a mean reversion (retracement) within this downtrend despite creating an uptrend on the daily or even weekly chart, which would be necessary to reach that distant level. Supplementary Chart C A Fibonacci channel below has been applied to a weekly TLT chart. Notice how the channel shows support right where the weekly lower wick formed—the 1.618 level of the channel. To be sure, this does not necessitate a long-term trend reversal (though anything is possible, and this could be the spot). But it does suggest the potential for a near term bounce in the shorter cycles. Supplementary Chart D Anyone wondering whether a long-term uptrend is still in place from the start of TLT's price history should consider the following chart. This shows decisive breaks of several long-term (and progressively accelerating) uptrends. Supplementary Chart E Year-end flows can be supportive of equities, though not always—note the late 2019 exception for CBOE:SPX and $NASDAQ:NDX. If some relief materializes in long-term to intermediate-term bonds, then this could coincide with some support in broader equity markets into year end, though this is by no means guaranteed. Consider the following posts and charts on yield curve inversions posted by @SPY_Master and this author on TradingView: These charts of yield-curve inversions should give one serious concerns about the near-term (3 months to 2 years) health of the stock market. This post is in no way advocating any particular investing or trading strategy. Short-term trading and long-term investing can both be either devastating or profitable (or somewhere in between those extremes) to the person engaging in it. And thanks for reading this and for your encouragement and support. ________________________________________ Author's Comment: Thank you for reviewing this post and considering its charts and analysis. The author welcomes comments, discussion and debate (respectfully presented) in the comment section. Shared charts are especially helpful to support any opposing or alternative view. This article is intended to present an unbiased, technical view of the security or tradable risk asset discussed. Please note further that this technical-analysis viewpoint is short-term in nature. This is not a trade recommendation but a technical-analysis overview and commentary with levels to watch for the near term. This technical-analysis viewpoint could change at a moment's notice should price move beyond a level of invalidation. Further, proper risk-management techniques are vital to trading success. And countertrend or mean-reversion trading, e.g., trading a rally in a bear market, is lower probability and is tricky and challenging even for the most experienced traders. DISCLAIMER: This post contains commentary published solely for educational and informational purposes. This post's content (and any content available through links in this post) and its views do not constitute financial advice or an investment or trading recommendation, and they do not account for readers' personal financial circumstances, or their investing or trading objectives, time frame, and risk tolerance. Readers should perform their own due diligence, and consult a qualified financial adviser or other investment / financial professional before entering any trade, investment or other transaction.
NASDAQ:TLT
by SquishTrade
46
Gold Tracks Purchasing PowerYES, gold does track your purchasing power over LONG PERIODS of time. It tracks the inflation ADJUSTED US Dollar more accurately than it does either the US Dollar OR Inflation. It is a better way to understand macro tides which move the price of gold. While there are periods of lower/diminishing correlation... you should really keep your eye on what has been happening now! Gold has been in a period of INCREASING, statistically significative correlation with Purchasing Power. WHAT DOES THIS MEAN? Well, when gold sniffs out the end of the current rally for US Dollar versus Inflation, then it will tell us on its price chart. You might want to reshare this post and maybe pin it. I will. ======== Below is why I did this post. What makes gold move? I see soo many focus too much on either inflation or the US Dollar. They are often wrong for 2 reasons: 1- Gold tracks neither per say, but inflation adjusted US Dollar (purchasing power). 2- Gold has a tendency to move 3 to 6 months ahead of the next move in purchasing power. Use charts for unbiased, objective evidence gathering. Forget headline news, stories, and narratives. #gold #usdollar #dxy #purchasingpower #inflation
INDEX:DXYShort
by Badcharts
37
How to Altseason Cycle || Cheat Sheet || Bitcoin DominanceMonitoring Bitcoin dominance (BTC-DOM) is a valuable tool for crypto traders. It provides insights into the relationship between Bitcoin (BTC-USD) and altcoins (ALT-USD), helping you make bette decisions about your altcoins and tokens. Spotting Altcoin Seasons: Altcoin seasons are periods of heightened interest in different cryptocurrencies and tokens, often causing their total market cap to surpass that of Bitcoin. Understanding BTC-DOM's movements can help you anticipate how the market might react: 1. BTC-DOM Goes UP: When BTC-DOM rises and BTC-USD also climbs, it often indicates a bullish phase for Bitcoin. During this time, ALT-USD may stay relative stable and face sideways. If BTC-USD experiences a decline while BTC-DOM is on the upswing, ALT-USD might witness a significant dump. When BTC-USD moves sideways and BTC-DOM follows suit, ALT-USD tends to maintain a stable course. 2. BTC-DOM Goes SIDEWAYS: If BTC-DOM remains relatively stable and BTC-USD sees an uptrend, ALT-USD often mirrors this upward movement. Conversely, if BTC-USD takes a dip while BTC-DOM remains flat, ALT-USD tends to follow suit with a decline. When both BTC-USD and BTC-DOM exhibit sideways patterns, ALT-USD typically remains in a state of relative stability. 3. BTC-DOM Goes DOWN: A decrease in BTC-DOM coupled with a rising BTC-USD often leads to a pumps for ALT-USD. When BTC-USD experiences a decrease while BTC-DOM falls, ALT-USD may stabilize or enter a sideways phase. If BTC-USD moves sideways while BTC-DOM declines, ALT-USD often witnesses an upward movement. Remember that while these trends offer valuable insights, the crypto market is highly volatile. Low cap altcoins can behave unexpectedly even when Bitcoin dominance suggests a particular trend. Therefore, use Bitcoin dominance as one of many tools in your investment strategy, and always conduct thorough research before making decisions.
by Vestinda
14
NIKE | JUST BUY ITNike topped Wall Street estimates for first quarter profit on Thursday as higher prices of its sneakers and apparel helped offset a hit from waning demand and persistent cost pressures, sending its shares up about 8% in extended trading. Nike (NKE) is the largest apparel company in the world, with leading positions across different categories and regions. The company is currently facing challenges such as elevated inventory levels, inflationary pressure, and slow growth in China. Such issues have resulted in the stock dropping by 19% YTD. Although these headwinds are serious, I believe the company's durable brand, leading position, and high-quality products should allow it to come out stronger on the other end. 'Nike is a brand that is of China and for China' -John Donahoe Like every other apparel and retail company, Nike thought post-pandemic demand would continue, so it increased production, which led to inventory levels hitting an all-time high in Q1-FY22, but as we know, that wasn't the case. Although NKE's inventory level is down from all-time highs, investors are still concerned, especially when inflation is eating into people's pockets and growth in China is slowing. Inflation in North America has come down to 3.7% from its peak in June at 9.1%, but it is still a concern in Europe (6.1% in the EU union). As you can see from the graph below, sales in China have been decreasing for the past two years. There are multiple ways one can explain this: COVID related lockdowns resulted in the shuttering of some stores. Plus, Nike and other apparel companies started facing a backlash in China in 2021 due to the alleged use of forced labor in cotton production. However, if the company is successful at expanding into China, then we can expect a lot of room for growth. Now that I have addressed the problems that are facing Nike, let me explain why I believe the company will overcome them. Nike sponsors the most well-known athletes such as Cristiano Ronaldo (+600 million Instagram followers), LeBron James, Michael Jordan, the late Kobe Bryant, Rafael Nadal, Tiger Woods, and more. This has helped the company build a loyal customer base and further boost its brand equity. With a loyal customer base comes pricing power, and as Warrant Buffet said: Nike's pricing power is no joke. Its shoes have reached a level where they are considered luxury, with some selling for more than the $10,000 mark. In 2017, Nike's median price for a shoe regardless of gender was $80, which is $10 more than its biggest competitor, Adidas. I know 2017 was a long time ago, but shoe prices have increased since then, and I believe Nike is still in the lead given their dominant market position. Plus, Nike targets mostly the age demographic of 25 and 34. These are people who have not settled in yet. They just graduated college with extra income to spend on things such as expensive shoes. I believe this pricing power will continue as the company continues to sponsor talented upcoming athletes to build trust with customers. Another way to measure Nike's brand power is by comparing its marketing spending against its peers. Nike's marketing budget in FY 23 was $4 billion, or 7.9% of revenue. On the other hand, Adidas spent 38% and Under Armour 11%. These companies have been allocating more of their revenue towards marketing but have experienced nowhere near the growth Nike has. NKE's association with well-known athletes in the U.S. has allowed them to have a 96% awareness rate, 53% usage rate, and 43% loyalty rate. Going forward, I expect the company's brand will remain high-quality due to sponsorships, high-quality products, and market-leading technology. Founded by Bill Bowerman and Phil Knight in 1994, Nike has come a long way from its first store in Portland, Oregon. As of May 31, 2023, the company had 369 stores within the U.S. and 663 internationally, operating in more than 190 countries. Stores include franchised stores and third-party retailers. The firm owns multiple brands such as Jordan, Converse, and Nike. The company derives sales from four main segments and across four regions. I excluded Converse (4.74% of revenue) from the graphs below because I wanted to focus on the Nike brand. The company's app, NikePlus, has more than 160 million users. On a trailing free cash flow basis, the stock yields over 3.3% relative to its enterprise value. My ~$104 May 24 PT implies a 28.00x P/E and 20.00x EV/EBITDA. Both multiples are below the ten-year NTM average and in line with the median. I project revenue to compound at a rate of 6.47% over the next three years, driven by market growth and new products, while shares decrease at a rate of 2.67%, driven by stock buybacks. The company is forecast to spend $12.1 billion on share repurchases over the same period. Additionally, I believe the company still has room for margin improvement driven by price increases and DTC mix (direct-to-consumer). In FY 2019, DTC sales constituted 31% of revenue, and that figure stood at 44% in FY 2023. Although NKE is trading at a premium compared to peers, I believe it is reasonable considering its scale, high-quality products, and strong brand. The first risk that I would associate with NKE is competition. The company competes with conglomerates such as Addidas, Puma, New Balance, Under Armour, and more. Additionally, e-commerce has made it very easy for anyone to start their own footwear brand. Other key risks to my rating include supply chain distributions, a recessionary environment, and slow growth in China. Finally, we can point out that NKE appears technically oversold heading into the Q1 earnings report. From the chart , there has been relentless selling pressure over the last four months since NKE was trading at $130 per share. The potential that NKE delivers a "good" earnings report with encouraging guidance, brushing aside fears the company is facing a deeper deterioration in its operating environment could be enough for shares to reprice higher. Simply put, our take is that NKE bears have gone too far, opening the door for bulls to take control. The bottom line is that Nike is currently experiencing headwinds such as elevated inventory levels, inflationary pressure, and slow growth in China. Every business goes through similar challenges at one time or another, but I believe Nike is well-positioned to overcome these issues due to its durable brand, high-quality products, and leading position. I expect the company to keep endorsing high-quality athletes to elevate its brand equity and further strengthen its pricing power. My valuation implies a price target of ~$104 for May 31, 2024. If you into NIKE brand you can watch Air film and read Shoe Dog book as well
NYSE:NKELong
by moonypto
20
EUR/CAD Long and EUR/USD LongEUR/CAD Long • If price corrects and a tight flag forms, then I'll be looking to get long with either a reduced risk entry on the break of the flag or a risk entry within it. • If my entry requirements are not met then I will simply wait until another setup which meets my plan materialises. • If there's any ambiguity then I will not place a trade on this pair. EUR/USD Long • If price corrects and a tight flag forms, then I'll be looking to get long with either a reduced risk entry on the break of the flag or a risk entry within it. • If my entry requirements are not met then I will simply wait until another setup which meets my plan materialises. • If there's any ambiguity then I will not place a trade on this pair.
Long
by StewySongs
9
Is the Finnish Bank OmaSp about to collapse?The charts are suggesting caution. On the above 10-day chart: 1) Double top in price. 2) Regular bearish divergence. The higher the timeframe you look the more ugly this divergence is. Laterally I’m wondering if the small banking crisis that hit the US is now venturing to other parts of the world. OmaSp does not appear to be in isolation. There were some tell-tell signs before the collapses of Silicon Valley and Signature Banks. (No one in Europe heard of those banks!) They were: 1) Strong bond market exposure. AND 2) Same TA as above. “OmaSp has been active in the bond market since 2013” says their website. Very true.. Until recently you could get the information on their Bond market exposure.. You click on the WebPage today and you get: www.omasp.fi “Unfortunately the webpage you were looking for can not be found” Oh dear… Ww Type: Trade, short Risk: <=3% Timeframe: Candles closing at 19 and under. 10-day Silicon Valley Bank before after 10-day Signature Bank before after
OMXHEX:OMASP
by without_worries
48
Crude Oil is Unchanged since 1985Adjusted for inflation as measured by FRED:CPIAUCSL , the price of crude oil hasn't changed since the price peak in 1985. The back and forth oscillations in supply and demand over the decades has left us right where we started back when I was in college 38 years ago! The price of a first class stamp in 1985 was 13 cents and is now 66 cents. So, the price of a stamp is up 5-fold but the nominal price of crude oil was $31/barrel back in 1985 and is just over $90 now for a 3-fold increase. So when you hear over and over in the general media that "crude oil is up" and devastating the economy, you can rest assured that "we have been here before". Yes, prices aren't as low as they were when we had Covid-Crash prices of $25/barrel but at least we don't have $140+ that we had back in 2008 prior to the deleveraging crash called the GFC.
TVC:USOIL
by timwest
48
Nvidia Hasn’t Done This Since JanuaryNvidia is on pace for its worst month in a year, but some dip buyers may see opportunity in the semiconductor giant. The first pattern on today’s chart is the 100-day simple moving average (SMA). NVDA has been holding that line since Thursday, one session after the Federal Reserve hammered the stock under $410. It was the first test of the SMA since early January, when the shares were under $150. Is the long-term trend still intact? Second, the current price range is near the lows of late June and mid-August. Intermediate-term support may remain in effect. Third, a falling trendline marks the decline that began in early September. But NVDA made a lower low on Monday and a higher high. That kind of bullish outside day may suggest that short-term slide is nearing an end. Finally, stochastics are trying to rebound from an oversold condition. 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 .
NASDAQ:NVDA
by TradeStation
11
S&P Double TopHistory and Introduction Everyone in the market today remembers broadly the financial response to C19. It We see it every time that we look at the price chart and we see the spike down and the V recovery. What a lot of people may not remember is the investigation into SoftBank for essentially causing a short squeeze by use of call options and gamma hedging. When that news story came out my long term assumption was we would be returning to the C19 low and that has informed every idea I have put out since then. News story www.investmentwatchblog.com An Explain Like I am 5 From Reddit When you write a call as a seller you essentially take a short position against the stock delta wise When SoftBank bought loads of calls that were out of the money then the writers had large negative delta positions against these tech stocks. One common way to offset a negative delta is you can hedge with owning shares to offset the negative position from the calls you write. As the calls were heavily wrote then shares were added to offset risk which contributed towards momentum. As the stock positions were entered it drove up price of stock which put those out of the money options closer to the money leading to more share purchases while SoftBank continued to purchase more and more calls leading to an increased share price between delta hedging and general market momentum. Someone can correct me if I’m off but that’s my broad description www.reddit.com Essentially when that news story came out I, personally, understood all these gains were unsustainable and were going to be given back. This was in addition to all of the other stimulus spending that was going on. There was still gains to be made or lost speculating in swing trading but my ultimate goal was to not buy the top and not to sell bottoms. Main Chart Analysis The main chart has been left pretty simple. We have the Gaussian Channel on top and we can see that in the 70s there were two points in time investors or traders got to buy below the gaussian channel. Fortunes could be made by buying below the channel and merely selling above the guassian channel. Loading up on dividend stocks would have also been very prudent. We can also see the opportunity came again in the 2000s. We can also see in purple the tops where the ADX has been at 20 or below. The 70s dip had the low ADX but the 2000s did not. It is not a necessary condition that the ADX be low for price to go below the gaussian channel, but it is suggestive that with the current low monthly ADX we have a fair shot of getting there. We also see that similar to the 1970s the ADX has been declining over each high for over the last decade. Not a good set of circumstances to be in. The right side of the chart shows the double top itself without any indicators and on the weekly time frame. As it stands right now it looks like a “lower high” double top but price could rally up 17% from the current level and this idea is still valid. The last top took over 300 days to develop and start to sell off to create the valley low. We can still have a significant amount of sideways as bulls get exhausted. Double Tops Double tops are suppose to have a flat base before the uptrend begins and then return to the flat base per Bulkowski, who is broadly considered to have written one of the modern trading “bibles.” www.thepatternsite.com The chart below shows what I consider the flat base to be. The fib draw on the double top does get us right into that range. Another thing to remember is that we don’t need to see an impulse that looks strait down. It is quite probable that price action takes out the valley low and then rally to test previous support as resistance. Here is an example of a double top on bitcoin from the 2018 bear market. The 4-hour chart provides the detail of a double top that developed over 25 days from the time the began to top to rejection oat previous support. So, not only could price action go sideways for some 300 days as the second half of the double top is created, but once price sells off we could spend considerable time in a suckers rally as price returns to previous support and tests it as resistance. Quarter Chart Long term, we have a chance to buy in the quarterly gaussian channel. This would require significant sidewise-ish or channel-ish price action for a decade. Dow Theory Basic Dow theory on bull markets has three phases, accumulation (smart money), public participation, and excess. From there we enter distribution, public participation, and panic. One tenant of Dow theory is indices must confirm one another. www.investopedia.com My linked idea will show that I thought that NDX would have a bull trap. That idea has been invalidated because rather than forming a classic bull trap NDX is likewise in a double top. But having both NDX and SPX in a topping formation suggests that we are in distribution. Since we are talking about Dow theory lets look at the DJI. T Guess what? he Dow looks like it is in a double top as well. Having all three indices appear to be topping within 5 percent of previous ATH is pretty bad. NASDAQ/S&P Since the Nasdaq is more volatile than the S&P we can look for bearishness in the NDX/SPX pair to see broader bearishness in the market. I am personally staying away from the Nasdaq as an investment as possible until it reaches its own double top target against the S&P. Crypto Assets Since I believe the SPX is a index that could be topping for over 300 days and having several consolidations on the way down I would expect some assts to go crazy as investors rotate and individual assets have blow off tops. I expect some massive rallies with some select cryptos and then a lot of despair. A lot of movement can happen in crypto over the lifespan of this idea. Here is bitcoin. What is the traditional target of a rising wedge? The beginning of the wedge. And there is no guarantee that bitcoin will set a higher high. If it does I am selling and probably never returning. Conclusion As someone who thinks the United States have been off sound money since the creation of the Federal Reserve I see all of this as the consequences of late-stage socialism. Subsidies to support government initiatives, transfer payments, bloated public services, debasement of the money supply all lead to public excess in the stock market. The United States as been more resilient than a lot of other countries in warding off the pernicious influence of socialist actors but once the Federal Reserve was created the ultimate conclusion was clear, it was just a matter of timing. Of course, due to inherent theory and model failure of most socialists they don’t realize it is the socialist policies that got the market here. Just like most don’t realize we are in distribution. The distribution phase can take a long time and I expect to be ignoring a lot of news. It’s a distraction. I am going to make the trades and investments as I see them. The main chart focuses on what happened to the SPX in two bear markets, one in the 70s and another in the 2000s. What happened to sound money (precious metals) in the 70s and 2000? Quite simply they went crazy. What happened to the Gold/SPX ratio? They reached muti-decades lows. If the SPX is topping then I would expect to see a massive upside pattern on gold. And I do. There is a cup and handle or ascending triangle. Based on that the time for me to rotate back into the S&P generally would be when the SPX/Gold ratio hits a double bottom from the low of 2011 Likewise with Silver and the S&P I think it is a decent time to take my kids to the precious metals store.
SP:SPXShort
by This_Guhy
17
HOW-TO evaluate volatility quality?The Volatility Quality Index (VQI) is an indicator used to measure the quality of market volatility. Volatility refers to the extent of price changes in the market. VQI helps traders assess market stability and risk levels by analyzing price volatility. This introduction may be a bit abstract, so let me help you understand it with a comparative metaphor if you're not immersed in various technical indicators. Imagine you are playing a jump rope game, and you notice that sometimes the rope moves fast and other times it moves slowly. This is volatility, which describes the speed of the rope. VQI is like an instrument specifically designed to measure rope speed. It observes the movement of the rope and provides a numerical value indicating how fast or slow it is moving. This value can help you determine both the stability of the rope and your difficulty level in jumping over it. With this information, you know when to start jumping and when to wait while skipping rope. In trading, VQI works similarly. It observes market price volatility and provides a numerical value indicating market stability and risk levels for traders. If VQI has a high value, it means there is significant market volatility with relatively higher risks involved. Conversely, if VQI has a low value, it indicates lower market volatility with relatively lower risks involved as well. The calculation involves dividing the range by values obtained from calculating Average True Range (ATR) multiplied by a factor/multiple. The purpose of VQI is to assist traders in evaluating the quality of market volatility so they can develop better trading strategies accordingly. Therefore, VQI helps traders understand the quality of market volatility for better strategy formulation and risk management—just like adjusting your jumping style based on rope speed during jump-rope games; traders can adjust their trading decisions based on VQI values. The calculation of VQI indicator depends on given period length and multiple factors: Period length is used to calculate Average True Range (ATR), while the multiple factor adjusts the range of volatility. By dividing the range by values and multiplying it with a multiple, VQI numerical value can be obtained. VQI indicator is typically presented in the form of a histogram on price charts. Higher VQI values indicate better quality of market volatility, while lower values suggest poorer quality of volatility. Traders can use VQI values to assess the strength and reliability of market volatility, enabling them to make wiser trading decisions. It should be noted that VQI is just an auxiliary indicator; traders should consider other technical indicators and market conditions comprehensively when making decisions. Additionally, parameter settings for VQI can also be adjusted and optimized based on individual trading preferences and market characteristics.
by blackcat1402
18
British Pound Plunges as Bank of England Holds Interest RatesI bring today is far from uplifting. As you may already be aware, the British Pound (GBP) has taken a significant hit in the wake of the recent decision by the Bank of England (BoE) to hold interest rates steady. This unforeseen turn of events has left many traders like yourself feeling disheartened and uncertain about the future of GBP. The BoE's decision to maintain interest rates has sent shockwaves throughout the financial markets, triggering a substantial decline in the value of the British Pound. This unfortunate turn of events has left the currency vulnerable and exposed to further downside risks. While it is indeed disheartening to witness such a decline, it is crucial for us to adapt and seize opportunities even in the face of adversity. Given the current state of affairs, I would like to encourage you to consider taking advantage of the situation by exploring short positions on GBP. The downward trajectory of the British Pound may present an opportunity for you to potentially profit from this unfortunate turn of events. However, please remember that trading involves risks, and it is essential to conduct thorough analysis and consider your risk tolerance before making any investment decisions. In times like these, it is crucial for traders like yourself to stay informed and adapt to the ever-changing market conditions. Monitoring economic indicators, central bank decisions, and geopolitical developments will be key in navigating the turbulent waters of the foreign exchange market. If you require any further information or assistance regarding shorting GBP or any other trading-related queries, please don't hesitate to comment below. We are here to support you and provide you with the necessary guidance to make informed trading decisions during these challenging times. Remember, even in the face of adversity, the trading world remains full of opportunities. By staying informed, adapting your strategies, and seeking professional advice, you can navigate these uncertain waters and potentially turn this unfortunate situation to your advantage.
TVC:BXYShort
by bryandowningqln
15
Hawkish Fed! Strong Dollar! - What are the markets expecting?he Fed has kept interest rates steady as expected, but Chairman Jerome Powell's statements were much more hawkish than anticipated. In summary, 12 out of 19 Fed members are calling for one more interest rate hike this year. No interest rate cuts are expected this year. Inflation is expected to remain high over the next 12 months. Tightening and balance sheet reduction will continue. An increase in unemployment is expected for 2024. Even if there's no interest rate hike this month, there could be one more increase later in the year. Key takeaways from the monetary policy meeting minutes and Powell's remarks: The year-end interest rate expectation for 2023 has been raised to 5.6%, and the expected rate for 2024, initially at 4.6%, has been increased to 5.1%. Additionally, the expectation for 2025, previously at 3.4%, has been raised to 3.9%. Long-term interest rates will remain high, with the long-term rate expectation at 2.5%. Unemployment expectations: 3.8% for 2023 4.1% for 2024 There is a bias towards an increase in unemployment. Core inflation expectations: 3.7% for 2023 2.6% for 2024 2.3% for 2025 2.0% for 2026 Expectations suggest a gradual decline rather than a rapid one. With the release of the monetary policy minutes, 2-year U.S. Treasury yields have risen to 5.1%, which is particularly negative news for stocks and gold. MARKET EXPECTATIONS: Gold: Initially, gold may continue to rise to the range of 1,960-1,963 as an immediate response. However, the continued high-interest environment will exert downward pressure on gold, and we may see a decline to around 1,880 levels after reaching 1,960. U.S. Stock Indices: Given the high-interest rates and high inflation, we shouldn't expect significant gains in the stock market. Currently, it's prudent to view every increase as a selling opportunity. USD: The strengthening of the dollar is expected to persist, especially against currencies of countries signaling relaxation in their monetary policies. The dollar is likely to maintain its strength for some time. EUR: The European Central Bank (ECB) took a dovish stance in its recent interest rate decision, reducing the possibility of further rate hikes. Although there has been a slight decrease in Eurozone inflation data, we may see a chart indicating USD dominance and a downward trend in the EUR/USD pair. JPY: Japan remains the only country with negative interest rates (-0.10%) and a commitment to a loose monetary policy, suggesting that the depreciation of the yen will continue. GBP: The Bank of England (BoE) decision and statements tomorrow will be crucial for the pound. However, our expectation is that tomorrow's announcements will resemble the Fed's hawkish stance, leading to some strengthening of the GBP. We will publish a new analysis after tomorrow's meeting to provide an update on the pound's situation. Oil: Today's U.S. crude oil inventory data came in below expectations, indicating that OPEC's production cuts are still in effect. We expect oil prices to reach $100 due to ongoing production cuts, which will negatively impact both stock markets and inflation for some time.
by TradeAndMeApp
25
The Power of Support Lines: A Bullish Trend on the Horizon?Introduction: In technical analysis, support lines play a crucial role in identifying potential trends and predicting future market movements. When multiple levels of support converge at higher levels, it can indicate a strong bullish trend. In this article, we will explore such a scenario and discuss how it could impact the overall direction of the market. The Case Study: Let's consider an example where the support lines for the weekly, daily, and hourly charts all intersect at a higher level. This convergence suggests that there may be a strong upward pressure pushing prices towards new highs. However, before jumping into conclusions, let's analyze each chart individually to gain a better understanding of the situation. Weekly Chart ]Analysis: On the weekly chart, the support line has been consistently above the price range, indicating a solid base of support. As long as this level remains intact, the bulls have control over the market. Moreover, the RSI (Relative Strength Index) is hovering around the mid-50s, which indicates a neutral market condition. Daily Chart Analysis: Moving down to the daily chart, we notice that the support line is also above the price range, confirming our initial observation from the weekly chart. Additionally, the MACD (Moving Average Convergence Divergence) indicator is showing a bullish divergence, suggesting that the uptrend may continue. Hourly Chart Analysis: Finally, let's examine the hourly chart. Here, we see that the support line is once again above the price range, reinforcing the idea of a solid base of support. Furthermore, the Stochastic Oscillator is reading near its oversold territory, signaling a potential bottom. Conclusion: While the intersection of these three support lines at higher levels is certainly intriguing, it's essential to remember that no single piece of evidence can guarantee a specific outcome. Other factors like economic indicators, geopolitical events, and investor sentiment must also be taken into account when making trading decisions. However, if we combine the findings from all three charts with other relevant data points, we might infer that the market is poised for a potential bullish move. It's important to monitor the situation closely and adjust our strategies accordingly based on further developments. Ultimately, the key to successful trading lies in staying adaptable and open to changing circumstances.
NSE:STYRENIX
by stocktechbot
7