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SCHW: One of the worse performers in 2023. Cautiously $LONGMain Idea/Insider "Alpha": Many large tech companies like NASDAQ:GOOG and NASDAQ:META use Schwab as their vendor to manage RSU grants. This makes me think Schwab is a great long-term investment and will continue to have good cash flow, assets under management, etc. In the idea above, I present a bull case and a bear case. At worse, this will be neutral and you can sell options against your position and/or collect dividends. In high interest rate environments, usually "banks" do well, and so schwab will benefit from halo effect if we see finance stocks continue to do well over the long-term. Other data points This website seems bullish as well: simplywall.st REWARDS Trading at 12.7% below our estimate of its fair value Earnings are forecast to grow 14.51% per year Earnings grew by 10.8% over the past year Pays a reliable dividend of 1.81% Analysts in good agreement that stock price will rise by 35.2% RISK ANALYSIS Significant insider selling over the past 3 months
NYSE:SCHWLong
by Sticky9000
Kelly Criterion and other common position-sizing methodsWhat is position sizing & why is it important? Position size refers to the amount of risk - money, contracts, equity, etc. - that a trader uses when entering a position on the financial market. We assume, for ease, that traders expect a 100% profit or loss as a result of the profit lost. Common ways to size positions are: Using a set amount of capital per trade . A trader enters with $100 for example, every time. This means that no matter what the position is, the maximum risk of it will be that set capital. It is the most straight-forward way to size positions, and it aims at producing linear growth in their portfolio. Using a set amount of contracts per trade . A trader enters with 1 contract of the given asset per trade. When trading Bitcoin, for example, this would mean 1 contract is equal to 1 Bitcoin. This approach can be tricky to backtest and analyse, since the contract’s dollar value changes over time. A trade that has been placed at a given time when the dollar price is high may show as a bigger win or loss, and a trade at a time when the dollar price of the contract is less, can be shown as a smaller win or loss. Percentage of total equity - this method is used by traders who decide to enter with a given percentage of their total equity on each position. It is commonly used in an attempt to achieve ‘exponential growth’ of the portfolio size. However, the following fictional scenario will show how luck plays a major role in the outcome of such a sizing method. Let’s assume that the trader has chosen to enter with 50% of their total capital per position. This would mean that with an equity of $1000, a trader would enter with $500 the first time. This could lead to two situations for the first trade: - The position is profitable, and the total equity now is $1500 - The position is losing, and the total equity now is $500. When we look at these two cases, we can then go deeper into the trading process, looking at the second and third positions they enter. If the first trade is losing, and we assume that the second two are winning: a) 500 * 0.5 = 250 entry, total capital when profitable is 750 b) 750 * 0.5 = 375 entry, total capital when profitable is $1125 On the other hand, If the first trade is winning, and we assume that the second two are winning too: a) 1500 * 0.5 = 750 entry, total capital when profitable is $2250 b) 2250 * 0.5 = 1125 entry, total capital when profitable is $3375 Let’s recap: The trader enters with 50% of the capital and, based on the outcome of the first trade, even if the following two trades are profitable, the difference between the final equity is: a) First trade lost: $1125 b) First trade won: $3375 This extreme difference of $2250 comes from the single first trade, and whether it’s profitable or not. This goes to show that luck is extremely important when trading with percentage of equity, since that first trade can go any way. Traders often do not take into account the luck factor that they need to have to reach exponential growth . This leads to very unrealistic expectations of performance of their trading strategy. What is the Kelly Criterion? The percentage of equity strategy, as we saw, is dependent on luck and is very tricky. The Kelly Criterion builds on top of that method, however it takes into account factors of the trader’s strategy and historical performance to create a new way of sizing positions. This mathematical formula is employed by investors seeking to enhance their capital growth objectives. It presupposes that investors are willing to reinvest their profits and expose them to potential risks in subsequent trades. The primary aim of this formula is to ascertain the optimal allocation of capital for each individual trade. The Kelly criterion encompasses two pivotal components: Winning Probability Factor (W) : This factor represents the likelihood of a trade yielding a positive return. In the context of TradingView strategies, this refers to the Percent Profitable. Win/Loss Ratio (R) : This ratio is calculated by the maximum winning potential divided by the maximum loss potential. It could be taken as the Take Profit / Stop-Loss ratio. It can also be taken as the Largest Winning Trade / Largest Losing Trade ratio from the backtesting tab. The outcome of this formula furnishes investors with guidance on the proportion of their total capital to allocate to each investment endeavour. Commonly referred to as the Kelly strategy, Kelly formula, or Kelly bet, the formula can be expressed as follows: Kelly % = W - (1 - W) / R Where: Kelly % = Percent of equity that the trader should put in a single trade W = Winning Probability Factor R = Win/Loss Ratio This Kelly % is the suggested percentage of equity a trader should put into their position, based on this sizing formula. With the change of Winning Probability and Win/Loss ratio, traders are able to re-apply the formula to adjust their position size. Let’s see an example of this formula. Let’s assume our Win/Loss Ration (R) is the Ratio Avg Win / Avg Loss from the TradingView backtesting statistics. Let’s say the Win/Loss ratio is 0.965. Also, let’s assume that the Winning Probability Factor is the Percent Profitable statistics from TradingView’s backtesting window. Let’s assume that it is 70%. With this data, our Kelly % would be: Kelly % = 0.7 - (1 - 0.7) / 0.965 = 0.38912 = 38.9% Therefore, based on this fictional example, the trader should allocate around 38.9% of their equity and not more, in order to have an optimal position size according to the Kelly Criterion. The Kelly formula, in essence, aims to answer the question of “What percent of my equity should I use in a trade, so that it will be optimal”. While any method it is not perfect, it is widely used in the industry as a way to more accurately size positions that use percent of equity for entries. Caution disclaimer Although adherents of the Kelly Criterion may choose to apply the formula in its conventional manner, it is essential to acknowledge the potential downsides associated with allocating an excessively substantial portion of one's portfolio into a solitary asset. In the pursuit of diversification, investors would be prudent to exercise caution when considering investments that surpass 20% of their overall equity, even if the Kelly Criterion advocates a more substantial allocation. Source about information on Kelly Criterion www.investopedia.com
Education
by sofex
4
Pandemic Champion Zoom will be back!In this work, I will analyze Zoom Video Communications, Inc., a leading company in the cloud communication and collaboration sector, which offers online videoconferencing, chat, telephony, webinars, among other services, for different segments and audiences. My investment thesis is that Zoom is an innovative and profitable company that has the potential to remain a leading video-based unified communications platform well into the future. To support this thesis, I will evaluate the qualitative and quantitative aspects of the company. In the qualitative part, I will describe Zoom's business model and strategy, showing how it differs from its competitors, what are its strengths and weaknesses, the opportunities and threats it faces in the global market. In the quantitative part, I will present Zoom's financial and operational data, demonstrating how it has grown in recent years, and what its projections are for the future, for a well-structured technical analysis based on Wyckoff, structures and volume delta. _____ _____ _____ Company History The company emerged in 2011, as a result of the vision of Eric Yuan, a former engineer at Cisco Systems, who recognized the need to create a simpler, reliable, and high-quality communication platform. The company launched its main product, Zoom Meeting, in 2013, and has since been growing rapidly in terms of customers, revenue, and profit. The company went public on the NASDAQ stock exchange in April 2019, with an initial public offering (IPO) of $36 per share. In June 2019, the company became part of the Russell 2000 index, which comprises smaller-cap companies in the United States. In April 2020, the company was promoted to the Russell 1000 index, which includes larger-cap companies in the United States. In august 2020, the company surpassed a market value of $100 billion, becoming one of the most valuable technology companies in the world. Company's Sector of Operation The company operates in the software as a service (SaaS) sector, which is a business model that provides information technology solutions over the internet, without the need for customers to install or maintain hardware or software. The SaaS sector is a growing and competitive industry, benefiting from digitization, mobility, and cloud trends. Within the SaaS sector, the company excels in the cloud communication and collaboration (CCaaS) segment, which offers online services to facilitate remote work, distance education, and social interactions. The CCaaS segment is dynamic and innovative, adapting to technological changes and consumer demands. It is also a challenging and regulated segment, facing competition from major market players like Microsoft Teams, Google Meet, Cisco Webex, and Skype. Diversification and Innovation Strategy The company's strategy is to diversify and innovate its products and services to meet customer needs and differentiate itself from competitors. The company aims to become an open and flexible platform that integrates various cloud communication and collaboration solutions. Some examples of products and services that the company has launched or acquired in recent years include: Zoom Phone: a cloud telephony system that allows users to make and receive calls using the same Zoom Meeting application. Zoom Rooms: an integrated system that transforms any physical space into a virtual meeting room with video, audio, and screen sharing. Zoom Webinar: an online service that enables users to host virtual events with up to 50,000 participants and 100 speakers. Zoom Chat: an online service that allows users to exchange instant messages with other Zoom users or external contacts. OnZoom: an online platform that allows users to create, host, and monetize interactive virtual events, such as classes, shows, workshops. Kites: a startup specialized in real-time automatic translation for video conferences. SWOT Analysis It is an essential tool for evaluating a company to invest in, as it offers a broad and organized view of the company's current situation. It consists of identifying the Strengths, Weaknesses, Opportunities, and threats that affect the company's performance. This is a qualitative analysis and does not replace technical or fundamental analysis. The company's SWOT analysis is as follows: Strong points: Freemium model: Zoom offers a free basic plan that allows up to 100 participants and unlimited sessions of up to 40 minutes, attracting those looking for an affordable and quality solution for online communication. Ease of use: It is known for its simple and intuitive interface, which allows participants to start and join sessions with just a few clicks. The company also offers features such as virtual backgrounds and video retouching to enhance the look and feel of those involved during sessions. Global Usage: The platform has a global presence, with more than 300 million daily session participants and more than 213,000 enterprise customers worldwide. It also supports multiple languages and currencies, meeting the needs of diverse audiences. Financial strength: The company has experienced significant revenue and profit growth in recent years, driven by the high demand for online communication during the COVID-19 pandemic. Zoom's total revenue for fiscal 2023 was $4,393 billion, up 7% year-over-year. Business revenue was US$2.409 billion, an increase of 24% compared to the previous year. Brand name: The solution has become a household name and synonymous with online communication, thanks to its popularity and recognition among consumers. Zoom has also received several awards and recognition for its quality and innovation, such as the Webby Award for Best Mobile App in 2020. Weak points: Security issues: The company has faced many security and privacy issues in the past, such as “zoom bombing”, which is the unauthorized invasion of sessions by malicious people who interrupt or share inappropriate content. It has also been criticized for sharing consumer data with third parties without proper consent. They don't offer end-to-end encryption: Despite claiming to offer end-to-end encryption, the platform actually uses a type of encryption that allows the company to access session data if it wants to. This raises concerns about the confidentiality and integrity of participant communications. Zoom Rooms: Zoom rooms are a feature that allows stakeholders to create dedicated physical spaces for online communication using specialized Zoom or partner hardware. However, this feature is expensive and requires an additional monthly subscription, which may limit its adoption among customers. Opportunities: Growing demand: Demand for online communication is set to continue to grow in the future as more people embrace remote work and hybrid work models. The company can capitalize on this opportunity by expanding its customer base and offering customized solutions for different industries and needs. Up-selling: It can increase its revenue by encouraging basic plan consumers to upgrade to paid plans, which offer more features and benefits, such as longer sessions, more participants, recording and cloud storage, Zoom Phone and Zoom Rooms. Diversification: The platform can diversify its offer of products and services, exploring new markets and segments, such as health, education, entertainment, and e-commerce. The company can also develop new technologies and features, such as augmented reality, artificial intelligence and machine translation, to improve the user experience and differentiate itself from the competition. Threats: Intense competition: The company faces strong competition from other players in the online communication market, such as Microsoft Teams, Google Meet, Cisco Webex, Skype, and Facebook Messenger. These competitors have greater financial, technological and marketing resources than it does and can offer integrated and competitive solutions to customers. Regulatory changes: The platform is subject to various laws and regulations in different countries and regions, which may affect its operations and revenues. For example, it may face restrictions or bans from operating in certain markets due to national security, data privacy or human rights concerns. The company may also face fines or penalties for violating these laws and regulations. Dependence on network infrastructure: The quality and performance of Zoom services depend on the availability and reliability of network infrastructure, such as bandwidth, internet speed and stability. Any interruption or degradation of these factors could negatively impact the user experience and the reputation of the solution. Final qualitative analysis opinion ZM benefits from its freemium model, ease of use, global usage, financial strength and brand name. But, it also faces challenges such as security issues, lack of end-to-end encryption, cost of Zoom rooms, intense competition, regulatory changes and dependence on network infrastructure. The company can take advantage of videoconferencing demand growth, up-selling and diversification opportunities to overcome its weaknesses and threats. The platform must invest in improving its security and privacy, innovating its products and services and expanding its presence in new markets and segments. Zoom has the potential to remain one of the leading video-based unified communications solutions in the future. _____ _____ _____ Fundamental Analysis: We will introduce fundamental analysis, focusing on the company's financial health and performance. For this, we will use financial data from the second quarter of the fiscal year 2024 (ended on July 31, 2023). The financial indicators we will consider are: EBITDA, CFO, ROE, ROIC, Gross Margin, and Operating Margin. Description of fundamentals: Source: Yahoo Finance The company has good liquidity, as it has a high ratio of liquid assets in relation to liquid liabilities, which indicates a low default rate on its basic obligations and low default rates. Furthermore, the company has a large loss in relation to equity and this further reduces its potential market value. Source: Yahoo Finance The company has excellent financial health and strong performance. The company demonstrates high operating profit (EBITDA), good cash generation (CFO), good return on equity (ROE) and invested capital (ROIC), and good gross and operating margins. These results show that the company is efficient, profitable, sustainable, and competitive in the video conferencing and online collaboration market. Other Fundamentals indicators We will address other economic indicators that are not as necessary but can be incorporated into our fundamental analysis. Source: Yahoo Finance The data in this table shows that the company has a good financial performance, but also faces some problems. For one, Zoom Meeting has a high P/E Ratio, which indicates that investors expect future earnings growth from the company. Zoom Meeting also has a high Enterprise Value, which represents the company's total value in the market. These indicators suggest that Zoom Meeting is a successful and innovative company, offering a high-quality and in-demand communication service. On the other hand, Zoom Meeting has a low P/B Ratio and a low PSR, which indicate that the company is trading at a price well above its book value and sales. This could mean that Zoom Meeting is overvalued or faces strong competition in its industry. Furthermore, Zoom Meeting does not pay dividends to its shareholders, which may discourage some investors looking for a stable and secure income. These indicators propose that Zoom Meeting is a risky and volatile company that depends heavily on market expectations and industry trends. Final opinion of fundamental analysis It has significant potential for growth and generating value for shareholders, especially in a scenario of increased demand for digital solutions, but it needs to face the threats mentioned previously in the company's SWOT analysis. . Technical Analysis To begin the study, first, we observe that the stock was launched in April 2019, and in January 2020, there was a significant increase, as we can see in the weekly chart. With this, we will divide this technical analysis into three parts. In this chart, we have the presence of three volume profiles. It calculates volume by price level based on the Gaussian curve and is excellent for measuring long-term position buildups, especially in a weekly chart like this. Analysis of the first profile: ZM Weekly Chart Note that, since the IPO process, the stock appreciated by 671.09%, which is quite substantial. Many companies were negatively affected during the pandemic, but this one inadvertently benefited from the COVID-19 pandemic. In this first profile, we see the largest position buildup right at the range of 68.75 to 76.95. You can already see 2 candles of aggression, as shown in the second graph, causing significant drops. Analysis of the second profile: ZM Weekly Chart Observing the second profile, we see a lack of demand from buyers and a position buildup on the selling side, unlike what we observed at the beginning. Analysis of the third profile: ZM Daily Chart Upon examining the last profile, we see that despite the market coming from a downtrend channel, we can observe a drastic increase in volume per price level, which is a characteristic of a position buildup. As we gradually see, the seller has been reducing their position, and furthermore, the stock is in a downtrend channel that if it surpasses 78.50, combining it with the fundamentals, we could potentially have an upward trend. Macroeconomics and Technical Analysis Surprisingly, Zoom is not the only one that experienced a drop that significantly devalued its stock. Several companies listed on the Nasdaq Composite, including the Nasdaq Composite itself, suffered from a drop that impacted the United States economy. E-mini Nasdaq Weekly This was motivated by high inflation, which reached around 9%, which is indeed a very concerning figure for the US economy. By February, inflation had already reached 7.5%, which was already a very high percentage, as technology companies react poorly to inflation. This explains the poor performance of these stocks. February table Source: Tradingview Economic Calendar These data explain the drop in assets listed on the Nasdaq, but surprisingly, Zoom was affected much more than the other companies. Later, when the price started to increase slightly; And the year 2022 contributed even further to the devaluation of ZM shares. But as we can see, the asset was already in the process of falling long before: ZM Daily Chart There was the beginning of a bearish rally there. Even if the current data are not so favorable, the deflation process that occurred in the United States, together with the artificial intelligence race, could also be a detail that will greatly help in the ZM valuation process. September table updated Source: Tradingview Economic Calendar September's data clearly reveals a drop in inflation, but with several very significant drops, in addition to some negative points such as the reduction in job creation and economic development. Look at the table below: Source: Tradingview Economic Calendar Based on this table, Zoom Communications could have a positive result as the company recorded a drop in inflation in September, implying that the costs of products and services decreased. This can benefit consumers and businesses that use the Zoom Service. Conclusion Zoom Video Communications Inc. is a company with good financial and market performance, despite the broad devaluation it suffered in 2021/2022. It demonstrates good fundamental analysis with strong revenue and profit growth, a high net margin, low debt and a good market value. The company also presents good technical analysis. It is undervalued, having been at an all-time low since its IPO, building a position for a likely long-term upward trend. Although the macroeconomy does not favor the variable income market due to a high interest rate of 5.5% (possible readjustment to 5.75% in September), it can also benefit from the ongoing economic deflation, which should stabilize in the end of 2024. It also has the potential to recover from the decline it has experienced and stand out in the technology market, especially in the videoconferencing segment, which has been less and less in demand post-pandemic and in times of remote work. Demonstrating its ability to innovate and adapt to changes in the economic and social panorama, offering quality and safe solutions to its customers. Therefore, it is believed that Zoom is a good investment option for those seeking long-term profitability and growth. I hope you enjoyed this article and found it helpful. Thank you for your attention, and until next time!
NASDAQ:ZMLong
by Victoredbr
2
TSLA -- shortIt looks to me like TSLA will fail to break through both the VWAP since the July high an the top of the declining short-term trading channel. I expect a decline down towards the bottom of the rising intermediate-term trading channel. Fundamentally, I think that the weakness in Chinese Yuan and the Chinese economy, as well as the price cuts, increasing EV competition from traditional auto makers, and a potential recession in the US will eat into gross margins and USD revenue growth. This is a short-term trade, which I will express as a vertical put spread with 3 weeks to expiration. My price target is 230, my stop loss will be a close above the declining trend channel since the July high.
NASDAQ:TSLAShort
by matthias
2
Let's go to the Moon!As the halving for Bitcoin approches in April 2024, I am expecting a fast approach to all time highs around end of Nov-Dec of 2024. Bitcoin remains the #1 Cryptocurrency and will be here for time to come. Using the 2020 Bull and Bust Trend, the Ghost Candles mark the path. I do not believe there will be a 2024 Bitcoin Crash as it is getting harder and harder to get more Bitcoin for your moneys worth as price increases on a rapid pace if people feel FOMO. There is a forbes article "Here’s What Caused Bitcoin’s ‘Extreme’ Price Plunge" and from what I read it was due to a Bitmex outage based on being knocked offline. I believe that Futures price shouldnt matter because if you actually hold your Bitcoin in your wallet, price on for Futures shouldnt matter and when you get liquadated on Bitmex, your Bitcoin only goes from your hand to another persons hand. One persons Loss is anothers Gain. I am also 10,000 Matic Tokens to see if I get lucky on the next bullrun, just as a side bet on the altcoin. Bitcoin should be your number one Cryptocurrency holding. Let's go to the Moon!
COINBASE:BTCUSDLong
by sniperfox2021
1
NVDA has topped. Sell it now.2023 has been an incredibly strong year for stocks. The Nasdaq rallied 38% in the first six months for one of the best starts to a year in history. This rally has been primarily led by an AI/tech theme that has been responsible for the bulk of these gains. That part of the rally is likely over, however… at least for now. Every bull market has a “theme” with leading stocks that set the pace. In the late 90s that was the dot-com bubble. In the 2009-2020 bull market that was big tech like Facebook, Amazon, Netflix, Apple and Google (hence the FAANG stocks moniker). The 2020-2021 bull market was led by “work-from-home” stocks like Zoom, Teladoc and Peloton. The 2023 bull market has been led by artificial intelligece. The leading stocks have been Meta, Microsoft, Dynatrace, MongoDB, Palantir, AMD, and the biggest leader of them all, Nvidia. Over the last 4-6 weeks we have witnessed many of these leading names roll over and retrace beneath their 50-day moving average – a key level that generally supports top stocks through the move higher. Despite the recent pullback in the market, Nvidia has held at its highs. Wednesday after the close, Nvidia reported earnings. And the results were better than anyone could have expected. Earnings $2.70 per share versus estimates of $2.08. Sales were $13.5 billion – 20% above expectations. And the company raised forward guidance (how much they expect to bring in next quarter) from $12 billion to $16 billion. They also announced a $25 billion share buyback which should act to propel the stock price even further. Investors got everything they wanted and then some. NVDA stock shot up 10% after hours. The news was so good, the entire Nasdaq index shot up 1% on the news. But Thursday, in the first few hours of trading, all of those gains were gone. The Nasdaq opened higher, and immediately began selling off. It fell 3% during the session. And NVDA was back where it closed the day before. This, to me, is a clear signal that the 2023 rally in tech stocks is over. The high was likely made on July 19th, and I doubt we see that level again this year. In a bear market, like we had in 2022, what you want to see is the market going UP on BAD news. This is the sign that the low is in, and buyers are coming back in. We saw this on October 13, 2022. After a government inflation report revealed the worst numbers yet – far worse than expectations – the market gapped down and opened a full 3% lower than it was the day before. However, stocks immediately began to rally, and the index surged 5% that day. This was the signal that the low was in. On the other hand, in a bull market, we want to watch for times when the market goes DOWN on GOOD news. This often signals a top. And I believe we saw that on Thursday. Nvidia was the only stock that could have reversed this pullback. The earnings report was better than even the most optimistic investor had hoped. This should have absolutely put an end to the pullback and caused the market to rally higher. Instead, we saw the opposite. So, what does this mean? First of all, and let me be clear on this, I am NOT saying the market is about to crash. I simply believe the “easy money” stage is over. I expect to see fairly choppy conditions for the next few weeks or months, and investors can no longer rely on the bull market to push everything higher. I believe tech stocks have seen their highs for 2023. Those with large open gains in stocks like Meta, Amazon, Apple, Google, Nvidia and the like may consider selling to lock in those gains here. There will still be stocks that go up, some of them by substantial amounts. But I believe this is now a more selective stock picker’s market. Personally, I sold the index funds in my long-term account and moved to cash ( I also went short the Nasdaq via QID). As of yesterday, those index funds funds were up 37% year-to-date. That is a phenomenal year, and I do not want to risk giving those gains back. To me, this is a low-risk decision. The worst-case scenario is that I am wrong or something material changes that propels stocks higher. If this happens, and the Nasdaq makes new highs this year, I will simply buy those funds back. All I will have missed is a 6% move.
NASDAQ:NVDAShort
by rossgivens
79
BRICS Using.... BITCOIN ? 😨Hi Traders, Investors and Speculators of Charts📈📉 Bitcoin is now political. (if it wasn't already before, it definitively is now). In a recent development, official news leaked that that BRICS nations may look at using BTC to undermine the Dollar as a reserve currency. At the same time, many nations have drastically reduced their USD exposure. China's holdings of US treasury bonds decreased significantly to $835.4 billion in June 2023, marking a substantial drop of approximately $103.4 billion within a year. ( Despite this reduction, China remains one of the largest creditors to the United States, with Japan holding the top position at $1.105 trillion. ) Additionally, the BRICS nations, a group consisting of Brazil, Russia, India, China, and now Saudi Arabia, are exploring the idea of using Bitcoin as an alternative to the US Dollar for international trade and exports . This suggests a growing desire among these nations to reduce their reliance on the US currency. Saudi Arabia, a new member of BRICS, also decreased its holdings of US debt by $11.1 billion during the same period, now holding $108.1 billion. These moves by BRICS nations reflect their increasing opposition to the dominance of the US Dollar in the global economy. Even though the bears have undoubtedly taken control of BTC short term, this is very provocative news that will definitely affect the Bitcoin price. The two main outcomes I see: 👉 Sellers drop the price lower to an entry point that is more acceptable for whale buyers in BRICS countries. BTC trades range for months. 👉 Considering USA holds most of the BTC supply by country, we see a price increase to make it harder / less affordable for BRICS countries to accumulate BTC. Lot's of volatility as BTC buyers vs sellers fight for macro dominance Although, having been in this space for a while, I'm leaning more towards the first option considering that was what happened when El Salvador made similar claims. As of March 8, 2023, Top Countries with BTC holdings are : 1) United States (805,810 BTC) 2) Russia (129,210 BTC) 3) Germany (108,150 BTC) 4) Switzerland (105,000 BTC) 5) Netherlands (88,400 BTC) 6) Canada (70,000 BTC) 7) United Kingdom (58,000 BTC) 8) Sweden (52,000 BTC) 9) Japan (42,000 BTC) 10) Australia (38,000 BTC) Ziad Daoud, Chief Emerging Markets Economist for Bloomberg, suggests that Saudi Arabia's (a large oil nation) shift towards riskier assets could influence the Federal Reserve's stance on interest rates, both domestically and globally. This could potentially lead to higher US interest rates. So where does this leaves you, as a Bitcoin trader / speculator? Not in a great place. With these new developments it may be harder than ever before to predict the direction of the price. My recommendation is still the same since weeks ago.. Altcoins. There are MANY better trading setups within the altcoin market that have better risk/reward setups. I personally won't touch BTC for the moment. ______________________________ Incase you missed it, previous relevant updates here : BRICS 2023 Summit outcomes : Capitalizing on BRICS nations stocks: _______________________ 📢Follow us here on TradingView for daily updates and trade ideas on crypto , stocks and commodities 💎Hit like & Follow 👍 We thank you for your support ! CryptoCheck
by CryptoCheck-
36
Higher for LongerUS inflation data in July 2023 provided mixed signals. While Consumer Price Index (CPI) is moving in the right direction, producer price inflation suggest pipeline pressures are picking up. Core CPI, which excludes often-volatile food and energy costs, rose only 0.2% for a second month in a row . However, US producer prices picked up in July, owing to increases in certain service categories. This likely buys more time for the Federal Reserve (Fed) to deliberate on the future path of monetary policy. The flows into bond exchange traded funds (ETFs) have been volatile. Over the past year, investors were starting to embrace duration. Investors were positioned for recession, inflation crash, and Fed cuts - evident from $31.7bn inflows to Treasury bond ETFs on pace for a record year2. However, investors are starting to pull out of the biggest bond ETFs devoted to Treasuries. More than $1.8 billion came out of the $39 billion iShares 20+ Year Treasury Bond ETF last week, the most since March 20203. Sentiment toward long-dated Treasuries has soured over the past month amid growing conviction that the Fed will keep interest rates at elevated levels for an extended period. We expect rates to remain higher for longer and are unlikely to see the Fed cut rates until the Q1 of next year amidst a stronger US economy. Don’t celebrate on disinflation just yet Overall, the US economy continues to show extraordinary resilience despite monetary constraints and credit tightening. While inflation has shown encouraging signs of decline, we caution that the level remains high. Strong July retail sales raise the risk of a re-acceleration in inflation. The four biggest categories of the ex-auto’s component saw outsized gains: non-store retailers, restaurants & bars, groceries, and general merchandise. Amidst a tight US labour market, with unemployment at historic lows and wages continuing to rise, the downward pricing momentum in the service sector is likely to be at a slower rate. Commodity prices are also beginning to rebound from the weakness seen in Q2 2023. Energy prices have been rising on the back of Organisation of Petroleum Exporting Countries and its allies (OPEC+) production cuts. If commodity prices extend their recent momentum, it could pose upside risks to inflation. Fed Officials remain divided Messaging on a somewhat mixed inflation outlook from the Fed Officials remains a mixed bag. One faction remains of the view that rates hikes over the past year and a half has done its job while another group contends that pausing too soon could risk inflation re-accelerating. Fed governor’s Michelle Bowman and Christopher Waller remain in the hawkish camp, hinting at more rate increases being needed to get inflation on a path down to the 2% target. Futures markets are assigning about a 11% chance of a 25-basis-point rate hike when the Fed next meets on 19 and 20 September4. Additionally, rate cuts have now been completely taken off the table until perhaps later in the Q1 2024. The latest Fed minutes reveal commentary from officials, including the hawks, such as Neel Kashkari, suggest a willingness to pause again in September, but to leave the door open for further hikes at the upcoming meetings5. Opportunity for a yield seeking investor It’s been an impressive turnaround since the pandemic when negative real yields became the norm. TINA- ‘There Is No Alternative’ to equities, is over now that evidence of the shift to a 5% world appears stronger than ever. Today investors have the opportunity to lock in one of the highest yields in decades, with US two-year yields paying close to 5% exceeding the yields at longer maturities without the volatility witnessed in the 10-year sector. A resilient US economy is likely to keep interest rates and bond yields higher for longer. Sources 1 Bureau of Labour Statistics as of 10 July 2023 2 BofA ETF Research, Bloomberg as of 9 August 2022 - 9 August 2023 3 Bloomberg as of 14 August 2023 4 Bloomberg as of 17 August 2023 5 federalreserve.gov as of 16 August 2023 This material is prepared by WisdomTree and its affiliates and is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of the date of production and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and non-proprietary sources. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by WisdomTree, nor any affiliate, nor any of their officers, employees or agents. Reliance upon information in this material is at the sole discretion of the reader. Past performance is not a reliable indicator of future performance.
FRED:FEDFUNDS
by aneekaguptaWTE
LUV Weekly Chart Showing Heavy DemandSouthwest Airlines has been going through some turbulence with recent flight rearrangement issues, but for the most part has smoothened out all issues regarding flights. Air Travel Demand is still thriving and growing exponentially, respectively. Southwest is a leader among a few others in Airline Stocks as they have High-Quality Management & Great Financial Strategy (e.g. Fuel hedging) The stock has performed quite poorly since its post-COVID peak of $65 and has retreated nearly 50% while remaining a sound financial base. Southwest has been hovering around this major demand zone at the $30 area. As highlighted in green, this demand zone has repeatedly pushed LUV back up higher, and on this weekly chart, we can see a triple bottom starting to push back higher from this $31 level. This weekly chart prevails a strong Risk/Reward towards Southwest as a swing-trade or LT investment. Southwest has remained a fundamentally strong & sound company as they are the first American Airline Co. to reinstate their dividend. EPS projections are very optimistic for the next several years as demand increases & costs decrease. It would also be likely to see a rotation into the travel / Airlines sector as it has been quite low and non-volatile thru the past half year. Recent PT cuts lead me to believe Funds could be loading up Conclusion: LONG NYSE:LUV through commons Option Play: Credit-Spread : Jan 19, '24 Puts $30-$27.5p
NYSE:LUVLong
by ZachSap