KESORAM INDUSTRUIES LOOKS GOOD FROM HERENSE:KESORAMIND
KESORAMIND Swing Breakout
R:R (Risk : Reward) = 1:3
TARGET 1 - 114
FINAL TARGET - 130
Smallcaps
Is the Market Deluding Itself with a Soft Landing Fantasy?As markets surge against expectations, many are starting to believe that the impossible might unfold. The unusually low fund allocation to equities reflects a market sentiment plagued by fear, yet mega caps are continuing to rise against expectations, making some investors feel left behind. With GDP figures beating expectations and headline inflation plummeting, markets are now starting to believe the soft landing narrative. Can the Federal Reserve, after decades of economic engineering, finally dodge a recession? The bond market remains skeptical.
When the yield curve inverted, everyone thought a recession was imminent. However, many overlook the lag between the onset of the inversion and an actual recession. Depending on historical context, a recession can either hit while the yield curve remains inverted or much later, once it has normalised. Thus, relying solely on the yield curve as a recession indicator can be misleading.
Nevertheless, history has consistently shown that a recession follows the inversion at some point. However, the human psyche is notoriously impatient. If a predicted event doesn't manifest promptly, the market tends to discount its possibility. Remember, most people buy at tops and sell at bottoms. So, the real question isn't whether a recession will happen, but rather when.
Why and When Could a Recession Happen?
The Federal Reserve holds significant influence over this timeline. As long as interest rates hover around 5.5%, the recession clock ticks faster. With headline inflation plummeting (orange line) and inflation expectations paralleling this descent (blue line), we must understand what caused inflation initially to gauge where it's headed.
The inflationary surge was mostly driven by the excessive expansion of the money supply. Examining the first derivative of the US money supply (M2) shows a rapid expansion followed by a subsequent decline. Comparing the growth rate of the money supply (yellow line) with the CPI year-over-year (orange line) reveals a 16-month lag. If this lag remains consistent, there's significant potential downside to inflation.
Yet, the Fed continues to hike rates, despite projections of disinflation and deflation. This is because the Fed's job isn't to predict the future, but to respond to current data. Indicators showing a robust labor market and elevated Core PCE caution against prematurely reducing rates. It would be wise for the Fed to await signs of weakening in these indicators before contemplating rate cuts.
This could potentially take a while to materialise, especially since unemployment doesn't seem poised to weaken in the immediate future. Unlike previous business cycles, the current situation stands out due to the Job Openings and Labor Turnover Survey (JOLTS) data. There remains a significant number of job openings for every unemployed individual. This bolsters the resilience of the labor market, making rate cuts less probable.
Furthermore, the Core Personal Consumption Expenditure (PCE) - a lagging indicator - remains historically high and resilient. Powell has emphasised the Fed's intent to avoid repeating the same mistakes made in the '70s, suggesting we should expect higher rates for longer in order to permanently get Core PCE to 2%. He's also highlighted the relative ease of stimulating the economy out of a recession compared to raising rates, implying it might be more straightforward for the Fed to rein in Core PCE by inducing a recession.
Similarly, the government can't afford the risk of the Fed raising rates later on. Considering the government's dependency on low-cost borrowing to manage interest payments on existing debts, higher future rates could pose a big challenge. Fortunately, the Fed uses the Reverse Repo (blue line) as a strategic tool to bypass any potential liquidity crisis until they are able to finance the government's balance sheet (orange line) with cheap debt once again.
Given that interest expenses are nearing 1 trillion USD, the Fed will inevitably have to cut rates to zero and initiate Quantitative Easing (QE) in the future. Remember, the sole limitation to Keynesian economics is inflation. Hence, it's logical for the Fed to avoid risking a resurgence of inflation. In essence, a recession might be essential for the Fed's future assistance to the government.
Deciphering the Stock Market's Puzzle
Despite Powell's frequent emphasis on a 'higher for longer' stance, the market remains skeptical. This is alarming, especially as the full implications of a 5.5% rate haven't been fully experienced by the economy. Once they manifest, job openings will plummet, unemployment figures will surge, and the 'soft landing' illusion might crumble. Historically, such scenarios are common when real rates reach unsustainable levels.
Fortunately for investors, there seems to be room for the AI bubble to continue. Markets typically peak about a month before a sustained increase in unemployment. Hence, forward-looking unemployment indicators like job openings, initial claims (blue line), and continued claims (orange line) are crucial for those wishing to divest before a potential market downturn.
In the current scenario, it might be wise for investors to stay away from higher-risk assets like small caps and cryptocurrencies. Historically, these haven't performed as well as mega caps during liquidity crunches. Investors might want to reconsider taking on additional risks unless there's a sustained surge in global liquidity (yellow line).
Conclusion: A Time for Caution and Opportunity
In conclusion, even though a recession seems inevitable, mega caps may continue their upward trend until the labor market reveals signs of distress. Therefore, it's crucial for investors to closely watch leading unemployment indicators and central bank balance sheets to ensure they're well-positioned for both the upcoming market downturn and the subsequent recovery.
Disclaimer: This article is intended for informational purposes only. It is not intended to be investment advice. Every investment and trading move involves risk, and you should conduct your own research when making a decision. Past performance is not indicative of future results.
$NOA is leading the international small capsNorth American Construction Group provides mining, heavy construction services to customers in the resource development, industrial construction in the US, Canada and Australia.
I tried trading this stock back in 2021 and got stopped out.
If it wasn't for that I would have had dead money for more than a year! Thank God for stops.
Now, NYSE:NOA is ready to make all time highs and it could be a good trade again. Already broke out relative to its peers ( AMEX:GWX ).
Other stocks in its industry/sector like NYSE:GVA , NYSE:MTZ , NYSE:EME & NYSE:OII are also in strong uptrends.
The Invesco Dynamic Building & Construction ETF AMEX:PKB is also making new highs. I'm looking for stocks in this sectors.
Not everything is tech stocks!
EMUDHRA - BLUE SKY ZONEEmudhra is in a constant uptrend, definitely recommend buying the stock & holding it. It has given a strong breakout with volume out of the descending channel, has sustained well above the same.
After hitting a new ATH, it took a breather, now started to move up again.
ASX: LEL - predicted $1.40, soon to be a lithium giant.Hopefully we close above the 50ema today, otherwise we'll be opening bellow it on Monday.
I believe we've already broken out of our "bear" market.
Using the Volume Profile indicator, I've found key areas where price reverses its trend. Every dip bellow the POC has been followed by large growth. Considering SP hit a 2 month gain of 104% after it dipped bellow the POC, it's safe to say the market is reacting to that and retail investors are taking profits. This is healthy market movement after a company doubled their MC.
Now, SP is sitting at a very key level, perfectly sat within the .5 fib, and price action moving closely to the POC. A dip bellow it in my books really wouldn't be the end and could probably cause a huge jump in SP.
The 2 Month POC is going to act as a level of resistance once price action moves closer, but breaking that will mean huge moves.
Ghost trend isn't meant to represent expected SP movment, simply a guide to show current trend. (We've been moving up for months, clearly we're just looking at a healthy market retrace)
$1.40 Level could see some heavily selling once reached due to past double top pattern at that level.
IWM is going much much higher based on latest accumulation countThis idea is based on Wyckoff's accumulation schematic. The current accumulation count yields a much higher IWM target. All info is on the chart. Good luck.
AIBB: BREAKOUT VIEW 3xAIBB is a coin that we can see in the format of pepe, this idea is based on the Technical side of this coin.
It seems that there is a good possibility this coin can break out in the coming time.
This study was made on the big side by TA.
Know that investing in meme coins can be risky, and do always your study.
ASX: SPQ - 100% in 18 Months!(ASX: SPQ) Superior Resources Limited is an Australia-based mineral exploration company. The Company's principal activities include exploration of lead-zinc-silver, copper, gold and nickel-copper-cobalt-platinum group elements (PGE) deposits in northern Queensland.
The company also owns interest in the projects of Deep Yellow Limited.
SPQ Recently raised $4 Million AUD via a share placement, where "sophisticated" investors where given the opportunity to purchase shares at a value of $0.03 per share. For every standard share purchased, the investor we're given 1 option with a strike price of $0.06, expiring 18 months from now.
The lead manger for the prospectus is Whario Capital, which seems to be a very lucrative investment firm, who is a corporate authorised representative of Redleaf Securities.
A number of shady individuals have been given access to this opportunity, one of whom has been charged and fined for dishonest conduct on the ASX.
A number of these holders are either running small investment firms in order to purchase these securities, or they're doing it under there name.
This "Idea" isn't based on the companies financials, the company itself seems extremely dodgy, because this isn't their first time offering options to select individuals.
They claim that the $4 Million raise is to fund their existing projects and to hopefully propel them into stage 2 of a number of their projects.
Their is a huge opportunity for retail investors to do their own research on this company, and potentially follow the smart money to a somewhat healthy return.
$IWM Outlook 05/30 - 06/02 @capgainsgroupAs the S&P 500 and the NASDAQ rally into the green for the year, the Russell 2000 (aka the small cap index) has lagged behind and is barely green at +1.03% YTD for 2023. One of the reasons why this index hasn’t been doing well can be attributed to the index’s 15.18% allocation in the Finance Sector. Failing regional banks such as Silicon Valley Bank ( NASDAQ:SIVB ) and Signature Bank ( OTC:SBNY ) haven’t helped the index much.
Investors who would like to play the Russell 2000 should pay attention to the 5 major sectors that makes up 73.23% of AMEX:IWM : Health Care (17.62%), Industrials (16.66%), Financials (15.18%), Information Technology (12.74%), and Consumer Discretionary (11.03%).
Technical Analysis:
AMEX:IWM recently formed a Death Cross (50 SMA x 200 SMA) on the daily chart in mid April. Although not very clean, there is a support uptrend line dating back to October 2022. Also, it seems like we have a head and shoulders pattern, using the Daily 170.30 level as the neckline.
Bulls will want price to reclaim the weekly 178.90 level as a support.
I lean bearish on this index. If AMEX:IWM can’t reclaim the two daily gaps above, at 176.74 - 177.42 and 180.53 - 181.28, I expect it to come down and test the yellow uptrend line and potentially break it to the downside in the coming weeks.
Upside Targets: 176.74 → 177.42 → 180.71 → 181.28 → 183.76 Extended: 186.91
Downside Targets: 174.09 → 172.33 → 171.41 → 170.30 → 169.32 Extended: 166.81
Insider Buying and Selling tradesLooking at some interesting insider buying & selling.
A few glimpses of some unusual buying & selling.
4-25-23 [russel2000]Good afternoon, Anon,
Seeking a comprehensive breakdown of the Russel2000?
Allow me to elucidate for you.
---
The Russell 2000 is presently entrenched in a quintessential Wyckoff accumulation phase:
Dubbed - The Wyckoff Accumulation Schematic #1.
---
Who is Wyckoff, and why is he of significance?
Well, Wyckoff reigns as the vanquisher of bears,
as well as the architect of unanticipated realities.
Wyckoff embodies an interdimensional algorithm,
crafted to cleave you asunder.
---
Green trajectory = Should the ensuing days yield favorable earnings, anticipate the Russell 2000 to be propelled into the celestial realms.
Strawberry trajectory = Russell breaches the low with ferocity, accompanied by a colossal volume spike, prior to being catapulted to all-time highs.
---
Ps. An upsurge in small-cap stocks signifies an environment inclined towards risk-taking.
Smalls B4 MegasIn both 08 crisis & pandemic crash, small caps consistently going up for several months were the proof that the bears were done.
That has not happened yet for this recession! Notice small caps are at best going sideways, & starting to trend further down, while ^RU50 Mega caps (like XLG) think the worst is behind them & Bulls saying don't miss the party.
But it's not the end of the Bear market. If Main street is still struggling, & we know & see it is all around us, then Wall street is just having a minor rally that will smack them back to reality soon enough.
Momentum doesn't lie, so watch the Volume & trends!
5 ways to play the current macro environmentWhy We Rallied
It's been a strong few months for the S&P 500, which is up about 13% from the October lows. There were five reasons for the rally:
1) P/E ratios got attractive, especially for small-to-mid caps.
2) Inflation peaked, which historically has sometimes marked the bottom for stocks.
3) Global liquidity turned upward. Every major bond market was pricing a central bank pivot, and the big central banks (particularly Japan and China) added about $1 trillion to their balance sheets.
4) Economic data remained surprisingly strong, which raised hopes of a "soft landing."
5) Possibly there was a bit of forced buying due to a "short squeeze."
Why the Rally Is Probably Over
However, I believe we've now reached an inflection point where these tailwinds will turn into headwinds.
1) The S&P 500 and Russell 2000 P/E ratios are once again looking high (although S&P 400 and S&P 600 still look cheap). (See this report from Ed Yardeni.)
2) Inflation is no longer surprising to the downside. The last couple prints have been exactly in line with forecasts, and leading indicators of inflation have been creeping back up. See, for instance, this chart of service sector wages, this chart of copper prices, and this Goldman Sachs forecast of crude oil prices. This is partly because of the global liquidity boost and continued deficit spending , and it's partly because of China ending its Covid-zero policy and reopening its economy. (China is the largest importer of crude and the second-largest importer of liquified natural gas in the world.)
3) With inflation set to stay high, liquidity has tightened a lot. The market is no longer pricing a Fed pivot , and analysts suggest the central bank liquidity boost may be over . Stocks have now gotten significantly higher than liquidity measures would predict , which suggests they may need to come down a little.
4) Economic data are deteriorating. Leading indicators have been pointing toward recession for months , but consumer savings and a glut of job openings have helped delay it. We're definitely starting to see weakness, though. Credit card debt has soared to an all-time high , we're seeing more late payments , and the housing market is cooling off fast , with inventories of unused construction materials piling up . We've seen "soft landing" hype before: in 2000 and 2007 , just before those recessions hit. Unless the Fed pivots immediately, it's probably not "different this time."
5) The short squeeze is over for large cap tech, with most of the shorts already forced out.
Five Ideas for How to Reposition
How to trade a coming recession?
1) The obvious trade is long bonds, short stocks. Bond market valuations are very attractive relative to stocks, with bond yields only a little below the S&P 500's earnings yield, and bond markets having perhaps gotten too hawkish relative to policy rates. Given the historical correlation between 10-year yields and S&P 500 valuations, the gap that has opened between them may imply an opportunity for a statistical arb. Either stock valuations should drop or bond yields should rise. Historically, in a recessionary environment, the bond market has tended to recover first, and the stock market second. So now would be the time to long those bonds.
However , it should be noted that this recessionary environment is an unusual one in a lot of ways. Stocks have already sold off a lot, and valuations are pretty mixed. Bonds should perform well if we get a deflationary recession that allows to Fed to lower rates, but a stagflationary recession might force the Fed to keep rates high even as the economy stumbles. Thus, it may be worth getting a little more specific with our trade. Here are some other ideas:
2) Long investment-grade bonds, short high-yield bonds. If recession is coming, then high-yield spreads are probably way too low . It's possible that high-yield bond rates will rise even as investment-grade, Treasury, and policy rates fall.
3) Long high-quality small- and mid-caps, short low-quality large caps. In my opinion, large cap tech is still way too crowded. I wouldn't want to short Microsoft right now, given the success of Bing AI. But I'd be willing to take a swing at Amazon, Apple, and Netflix as long as I could balance the risk by longing some cheap, quality smalls and mids on the other side. In my opinion, the size factor is ripe for disruption. If you'd asked me two years ago, I would have said that AI would most benefit large cap tech. Now I think it will most benefit smalls. What changed between now and then is that AI went from being the exclusive domain of big companies to being publicly available at shockingly low cost. This happened way faster than I ever would have guessed, and you better believe that small, agile companies will capitalize on the opportunities provided by access to AI!
4) Long cash to buy the dip on energy stocks. Energy historically has struggled in a recession, so it's quite likely that energy stocks will see some downside soon. However, the current free cash flow yield on energy stocks is quite high , and the sector trades at 10x forward P/E . Meanwhile, investment in the sector is still much too low . I believe there will be a decade-long structural bull market in energy due to constrained supply, but that there will probably be some recessionary pain first. Meanwhile, money market funds offer a really high return on cash. My Fidelity money market is giving me almost 4%. Ain't nothing wrong with just collecting that money market rate and waiting for energy stocks to dip for the buy and hold.
With retail investor inflows at an all-time high , I believe the current market environment offers a good opportunity for savvy bears to execute some well-constructed long-short trades. If you look at how the smart money is positioned, it's pretty much the opposite of retail positioning here. There will be a time to get bullish on US large cap stocks, but we probably need to see some weakening of coincident economic indicators like employment first. (Stocks tend to do best when unemployment rates are high .) Remember, market positioning beats market timing, but ideally you could do a little of both!
Thanks for reading, and please share your ideas in the comments below!
Nifty is leading the market. Why?hey everyone, In this video, I've shared my thoughts on NSE:NIFTY , NSE:CNXSMALLCAP and TVC:DJI
so sit tight and watch till the end to learn something new.
I hope you'll learn something new from this, and if you enjoy it,
please give me a follow.
See you later and bbbye.
#IWM Russel 2000 looking technically bullishSome real meaningful progression for the bull case in US small cap stocks.
50 dma > 200dma
Price has cleared the critical resistance level between 187-188.
Price has some short term resistance at the 38.2% fib retracement here, but it looks like we should progress to the next resistance level at the 50% fib retracement at 200.
Chart is showing a clear formation of higher swing lows and higher highs.
Hard to be bearish this chart.
Opportunity here to buy the breakout with a relatively small stop as a close below 187.50 might put the bullish case on hold.
$LOCL Falling Wedge Dectected!! (Big Gains)LOCL bounty is sitting here at less then $1 and at a market cap of 100m (High R/R)
As I was charting I noticed LOCL is ready for a run up. Check out the chart and make up your own mind (;
As for me…loaded up!
Total Non-stop ActionI think small caps will outperform and be squeezed
I think this can get to that old high
But otherwise I’ll be targeting the 50% level
Send it
NOT TARDING ADVICE
$IWM Hourly ChartBull Pennant Flag Pattern forming on the hourly chart with MACD cross; supported along with an incoming golden cross on the daily chart. See previous post for $IWM daily chart analysis.
Make or break for Smallcap shares...My view is bearish as samllcap index is forming a rounding top pattern. Unless it negates the pattern, BUY ONLY selected strength stocks in momentum.
Russell 2000 Index - EXPLAINED - What, Why, Where, How?Small cap stocks, Penny stocks and pink sheets are the high adrenaline stocks investors play games in.
They are generally the cheaper, highly volatile, some are illiquid and can fluctuate 50% - 1,000% a day.
From the Wolf of Wallstreet glamorizing the potential returns for investors to your every day salesman broker trying to sell you the next winner.
But what is the Russell 2000 Index and what should we know about it?
I’m going to sum it up a bit of information about how it works and important facts you need to know
Enjoy!
WHAT IS IT?
The Russell 2000 Index (listed in 1984) is a stock market index that tracks the performance of small-cap publicly traded companies in the United States.
It is named after the Russell Investment Group, which operates the index.
The share price can vary significantly, as it is made up of a diverse range of small-cap publicly traded companies.
MARKET CAP
Small-cap stocks are generally ones with a market capitalization of between:
$50 million and $2 billion.
CRITERIA TO LIST STOCKS
There are a few criteria that needs to be met to qualify for the inclusion in the Russell 2000 Index:
• The company must be a publicly traded U.S. company.
• It must market capitalization of at least $50 million.
• Must be ranked in the bottom 2,000 of the Russell 3000 Index, based on market capitalization.
• Must meet certain liquidity requirements, including having a minimum average daily trading volume of at least 250 shares over the previous six months.
• Must have a minimum of one year of trading history.
WHAT IT CONSISTS OF
The index is made up of the smallest 2,000 publicly traded companies in the Russell 3000 Index, which represents approximately 98% of the total market capitalization of all publicly traded companies in the United States.
HOW IT OPERATES
The index is reconstituted annually, with new companies added and removed based on their market capitalization and other factors.
VOLATILITY & LIQUIDITY
The Russell 2000 Index has a high level of volatility (greater price swings) and low liquidity (ease of flow of orders) compared to other large cap stocks.
DANGERS WITH THE INDEX
Currency risk: When the US dollar drops the index can follow
Diversification: There is no sector for the stocks. When the index drops the stocks follow.
Liquidity: You might find difficulties finding buyers or sellers to ease in or out of your positions.
Volatility: The jumpiness in the market is highly erratic.
Lack of analyst analysis: You’ll hardly see news coverage via the media which means, you could be left in the dark with what is going on in the companies.
Liquidation risk: You have a higher chance at being in a company that is about to be liquidated due to financial issues, no growth, manipulation and cooking the books.
Economic issues: When global economies collapse, stocks drop with it. Small cap stocks are no exceptions. This can affect the investment prospects
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AERG Long @ $1.73 (OTC only)AERG is a military contract company based out of North America.
They're at a yearly low and I am adding this on my portfolio.
We're well underneath our Keltner Channels on the 1 and 4-hour charts.
I believe we'll see support around this area as we retest our area of support that we just broke, marked with a red box.
I believe we'll retest the 200-day EMA. I may add onto this position as time goes on.
$HTGMHolding 23.6 fib level, looking for a potential retest of 38.6 fib level at 1.46 and find support and confirm trend reversal back towards HOD.
A Must Watch Nifty Analysis!!Hey Everyone!!
Greetings from my side, let's talk to the point
➡️ As of now, you'll be observing that the market's countertrend is negative and profit booking is coming.🔴
➡️ But the primary trend of the market is still up and 200 MA is pointing Upward too.🟢
➡️ So It can be a regular pullback on the higher time frame and can be used to buy good fundamental Stocks (Inner voice Saying Don't forget niftybees) NSE:NIFTYBEES ;-)
➡️ and to terminate the counter-trend we need a higher high or a close above this resistance which'll resume the primary trend.🟢
➡️ So one needs to be a little cautious in the upcoming Days.🔴
and If you want to know about good fundamental Stocks " Type fundamental in the comments "
Don't forget to follow for your learnings.✌️
