Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities
Stock-Markets / Financial Markets 2024 Nov 18, 2024 - 08:38 AM GMTBy: Nadeem_Walayat
Dear Reader
President Donald Trump Win Pumps the markets, Bitcoin, Crypto's and stocks higher, most missed the Trump win due to MSM propaganda and echo chambers, of course after the fact it was obvious to everyone that Trump would win, yeah sure it was, the trick is to say and act on it BEFORE the event not a week AFTER it happens! One can't place bets on Trump to win AFTER it's happened!
Donald Pump winning has been my consistent view ALL YEAR, where I iterated why Kamala Harris taking over from lost all of his marbles Biden was not going to make any difference to the outcome in fact regardless of the polls that consistently gave Harris a lead the exact opposite would be true, the election result was not even going to be close, a landslide win for Trump was incoming that would pump the markets, send crypto assets and stocks including Tesla to the moon so that is where the big bets should be.
3rd Nov -
According to MSM and pundits such as Leechman Karmal Harris has won!
According to DeemGPT (Me) it's not even going to be close, Donald Pump will win by a landslide (electoral college).
Remember MSM tells you to sell stocks at bear market bottoms and buy stocks at bull market tops, the exact opposite of DeemGPT. Anyway not long to go.....
Why was the landslide obvious to me since Harris took over ?
It's as simple as that! The Democrats infected with the Woke virus picked the worst candidate that they could have chosen and hence even a senile old fool would win, had they picked a white man with an ounce of charisma then the Dems would have sood a good chance of winning!
Litchman and his 100% correct 13 keys be DAMNED! The fool is now busy running around making excuses for why his 100% correct system got it BADLY wrong as I said he would do in my pre-election video.
The crypto markets are still pumping as i write, SOLANA busting above $240 achieving my target of a year ago! That's more than a 10X for all those who followed the analysis in my Last Chance to Board the Crypto Gravy Trains article of October 2023- Last Chance to Get on Board the Bitcoin Crypto Gravy Train - Choo Choo!
Choo! Choo!
Whilst Bitcorn hit $93k!
Barley 2 months ago Patrons were getting wobbly knees, I had to hold their hands to stay the course! Not panic sell like many clowns did BEFORE the BREAKOUT!
Market Brief - 3rd September -
BTC $59k - My view has remained consistent since the March top that following this correction BTC targets a trend to first $88k and then 100k+ probably achieved before the end of this year where the longer this correction goes on the more powerful should be eventual upside breakout, this correction is now 5 months old so at most there could be 1 more month to go before it's blast off time by which time many will have exited crypto. especially those who use leverage and then will scramble to buy back in during the FOMO breakout or worse wait for the dip that never comes.
Choo! Choo!
Patrons had access to ALL for just $7 bucks for month! Literally life changing time sensitive analysis and trend forecasts and as often gets posted in the comments folk are thankful as they are paying off their mortgages, as well as taking their kids on once in a life time holidays and more.... all paid for out of turning crypto play money into real money!
That's what $7 bucks buys you! I am too cheap! So what are you waiting for? Remember I aint getting any younger so as I tell my kids you need to capitalise on what I am sharing whilst I can because there will come a day when I won't be able to do it no more!
Here's a freebie - Tesla stock $334 has a destiny with $400 before the end of this year! More choo choo gravy train profits incoming!
So whilst you ponder the question of whether $7 bucks is worth the potential rewards of riding the AI and Crypto gravy trains then here's another article that was first made available to patrons who support my work. So for immediate first access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $7 per month, lock it in now at $7 before next rises to $10 per month for new sign-ups.
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities
I am back from a 2 week holiday / fact finding mission to Dubai where I learned the meaning of high humidity, that 44c can feel like 62c! Whilst I had been used to the opposite end of the spectrum where say 12c can feel like 6c due to the wind chill factor .Anyway after the initial shock to the system of stepping out of the air[port and into a blast furnace I next soon learned it's a dumb idea to go to the beach during the afternoon, not unless one is desperate to experience heat stroke! No the time to go to the beach is at night or better just before dawn at about 5am, so most days we tended to stay up until about 7am, sleeping and then waking up in the late afternoon to venture out at between 5pm to 7pm as most venues stayed open until midnight coupled with air con on full blast everywhere contributing to the concentre jungle's heat problem.
It was so humid that even at night one would be soaked in sweat outdoors.
Dubai Deluge
So what stood out most to me of what I saw and experienced in Dubai ?
Gleaming towers?
Ongoing construction on an epic scale?
Apparently how safe Dubai appears to be compared to knife crime ridden Britain?
How slave workers service the needs of the Emirates who get virtually everything handed to them on a platter?
No, what stood out to me the most is how much of a premium the British passport, education and qualifications carry in Dubai, it's as though Dubai and other such nations are stuck in the time warp of when the British Empire ruled the roost and thus still look upon all things British as being a premium Imperial Brand to lust after so it's no wonder that Britains brightest and best are settling in Dubai villas and apartments in their hundreds of thousands. However this is further bad news for Britain, BRAIN DRAIN! We have hundreds of thousands of Britains brightest LEAVING Britain and then we have a lot less skilled folk migrating into Britain from Eastern Europe, Africa, Asia and elsewhere which for at least the past decade and probably all the way to before the 2008 financial crisis has put Britain on a spiral of huge competitive disadvantage to many other western nations, hence economic stagnation and worsening services such as the NHS.
So whilst Britain may not be dying i.e. has a rising population, living in the UK is definitely not better than it was say 20 years ago, in fact looking at the economic statistics Britain's best post war decade was probably between 1995 and 2005 so it's no wonder Labour won landslide victories at them time and since 2008 Britain has been paying the price for the bailout of the banking crime syndicate worsened due to the impact of Brain Drain underway to the likes of Dubai. If 16 years of a Tory government could not fix this then LIebour has no chance of doing so, which means things WILL ONLY GET WORSE under LIEBOUR!
Personally I could not live in Dubai, too hot, maybe I will check it out during Dubai's winter months but I can definitely see the attraction of professional folk moving to Dubai because in the UK you are just another nobody whilst in Dubai as soon as one flashes ones passport one is a somebody! That's from teachers upwards, your wages are paid based on your PASSPORT! as the schools can advertise that we have british teachers and hence can command higher school fees, similar for all other services such as the hospitals.
And it's impossible for Britain a democracy to replicate what a dictatorship can do, I mean to me Dubai resembles ancient Sparta where about 13% of the population are Emerate a large percent of whom are in the military, whilst the state is supported by a 87% slave workers population with no rights to citizenship, and it gets pretty bad for non westerners i.e. those from the indian subcontinent or Africa who really are treated like slaves, still this is where even the slaves can make their fortunes over what their homelands have to offer so it's all about ones perspective where what seems like slave labour to me is probably a chance of a life time for others to get rich.
It's only a matter of time before UAE SPARTA armed to the teeth with US weaponry starts to go empire building, and looking at Yemen maybe they already are. Digging a little deeper the UAE grabbed Socotra Island off the coast of Yemen and are literally in bed with the Fourth Reich, too much to go into in this article but here is a good piece on the subject
The UAE-Israeli occupation of Yemen's Socotra Island
https://thecradle.co/articles-id/916
Looks like the UAE is destined to become the Arab twin of the Fourth Reich, going around the region planting their flag and stealing other peoples land with little regard to civilian bloodshed. I definitely could not live in Dubai as it would be impossible for me to keep my mouth shut and thus sooner or later I would find myself in front of an UAE SS officer.
Dubai is a rip off for tourists, and I went during the off season so the costs incurred where likely around 60% of what they will be in a few months time. Still there were plenty of upsides, very little traffic. and hardly any queues compared to when Dubai's population more than doubles during the peak season! So there are advantages to going in July.
Overall it was a good holiday / fact finding mission. Next on my target list is Japan. But the comparison between Britain and Dubai is stark where whilst the population is rising so not dying the infrastructure is crumbling and quality of services such as the NHS are eroding due to the Brain Drain. Britain is stagnating so your fortune is NOT going to be made in the UK, and I can't see what the new Liebour government could do to change things. I mean it's going to take building something like 1/2 million homes per year over the next 5 years to many any dent in Britains housing crisis, so that will be one metric to keep an eye on for any signs of a positive development that could encourage smart young folk to remain in the UK instead of migrating abroad because it's a nightmare for young professionals to afford to buy anything these days as the rich continue to hoover up assets.
Bottom line to end stagnation Britain needs to go on a house building boom! But even then the UK will be fighting a losing battle because no British high street can compete against AMAZON! I can imagine a day when western nations will start to effectively ban Amazon.
In fact ALL housing crisis be they in the US, Canada or Australia contrary to popular narratives NOT due to immigration but due to lack of CONSTRUCTION as whole swaths of vested interests DO NOT WANT MORE HOUSES TO BE BUILT! And hence home construction has been on a decline across many countries with fast growing populations such as Australia that one would imagine has plenty of space to build but the system is such that it is a pain in the butt to get permission to build new homes and hence limited supply coupled with a rising population sends house prices soaring into the stratosphere which favours those who already own homes and who have property portfolios which is NOT IMMIGRANTS, instead these imported wage slaves RENT, it's a topsy turvey world where reality is the exact polar opposite of the narratives, those who rent are slaves who pay the indigenous property owners a slave tax in the form of extortionate rents that keep climbing higher along with house prices and thus put home ownership further out of reach of immigrants and locals unless they are truly exceptional, the same is true in most western nations.
Without immigration house prices and rents would likely collapse and along with it the financial system as we came close to in September 2008. So those who want lower rents and lower house prices be careful what you wish for because the last time the world faced such an outcome we literally came within hours of financial armageddon! Instead what they should really be focused on is HIGHER WAGES! As it is that which is at the heart of the crisis in the West in that WAGES are FALLING In REAL TERMS, a trend that has been in motion since the financial crisis thus creating a WAGE SLAVE population which is one of the primary reasons I created the 3 part how to really get rich guide so folk have a change to escape wage slavery, a guide that is immediately freely available to ALL patrons, so if you have not read the guide then do so now as it will safe you many years of banging your head against a brick wall as most of the population has been brainwashed to except wage slavery by default from primary school all the way to University, a factory for producing indebted wage slaves resulting in increasing wealth inequality as the top 10% get 95% of the economic gains which means it gets harder for the bottom 50% to have any chance of getting rich as they are unable to keep pace with the rising cost of living let alone attempt to break free of wage slavery.
And then we have AI and Robots coming to make wage slaves obsolete! The bottom line is you don't have time left to piss about enjoying the University experience for 3 or 4 years, the time to act is NOW, IMMEDIATELY! Each day lost to twiddling ones thumbs will make it that much harder to achieve ones goals and dreams!
See my How to Get Rich Guides on how to hack the system turn the likes of Inflation to ones advantage.
Change the Way You THINK! How to Really Get RICH Guide 2023
Learn to Use the FORCE! How to Really Get Rich Part 2 of 3
The Investing Assets Spectrum - How to Really Get RICH
As AI replaces human wage slaves the population will be given handouts by the state (UBI) and billionaires who will seek to buy the loyalty of the masses. This is not speculation it is a trend that has been in motion for decades as in the UK near 11 million people, 1/4 of the working age population are economically inactive and in receipt of benefits. Yes once again the unemployment statistics are FAKE! UK unemployment is not 1.5 million, instead it is nearer 11 million!
So all that will happen is that the number of economically inactive will continue to grow until it eventually exceeds the number in work. This is a shocking statistic that 1/4 of those of working age are sat idle on their butts relying on the 75% who do work to pay for their life style as they ***** and moan about immigrants taking their jobs, so yes most people of working age will in the not too distant future be sat idle and in receipt of benefits and the amount they will receive will be inline with existing benefits so it's not going to be the fantasy world that allows folk to live a life of art and leisure as supply and demand inflation ensures that is never going to happen, as demand for leisure activities increases so does the price rise and quality of service diminish as is the case today those who do not work are seen as second class citizens that the likes of Landlords avoid like the plague, so imagine what it's going to be like when the majority fall into this class. There is going to be the UBI class, then the slave worker class and then all those who fall into the rich class, those who fall in the top 10% in terms of wealth. It is going to literally be MENTAL! Trapped on benefits for life with no way out, mental illness is going to be widespread, pills will be dolled out by GP's as a matter of fact and there will be many more psychiatric hospitals built to cope with the surge in mental illness. Yes AI is not going to deliver a land of plenty instead it is going to deliver much more mental pain to the masses, in UBI ghettos is where most of the depressed masses will live. worse even than how the slave workers live in Dubai! At least there at the present time there is WORK! Imagine a world without work! Without Hope! Mankind should BAN AI, but they won't!
So if most people are earning a pittance who will buy all of the goods and services a economy produces?
The answer is capitalism will do what capitalism does best, produce goods and services to extract revenues and profits from those who have all of the money which is the RICH, and not just the super rich with their yachts and mansions but the likes of you and me! I imagine most patrons who are aged 40+ are what most of the population would consider rich, as most get rich off of asset price inflation and business inflation. Whilst a few exceptional professional folk will get rich even though they are technically wage slaves. So there are an increasing number of rich folk who demand luxurious goods and services that the wage slave population service that Dubai acts as stark window into the world that is being created, there are the Emerate's and the wealthy tourists and business folk who consume goods and services and live in the rich areas where by virtue of the fact these places are too expensive for the workers to live in creates two worlds, the rich world and the 70% of slave workers world who live in their compounds somewhere out in the desert bussed in early in the morning in old busses to service the rich and out again at midnight.
That is the trend trajectory of every nation just that it is much more stark in Dubai. My daughter mentioned she would not like to live in Dubai because of the clear disparity in wealth between the haves and have not's, that's socialist British education for you! Then couple that with the drama that the likes of the BBC focus on i.e. the daughters of the Emir of Dubai crying crocodile tears of how hard a life they had in their palaces, go cry me a river why don't you! You are not worth one palestinian child suffering in Gaza at the hands of the Fourth Reich! No sympathy here for spoilt brats who have never done a days work in their lives!
The future is already being created, the slave workers cannot afford to live and exist in affluent areas of London, only commute in to service the rich, this is the way every city is going, pockets of affluence surrounded by rundown over crowded slave worker areas who will never earn enough to join the rich because they don't understand it's not about income it's about owning assets that produce passive income that is leveraged to inflation.
S&P Stock Market Trend Current State
The S&P nothing burger continues to follow the script for a correction starting early July and into Mid September to target approx 5060 that will likely be punctuated by at least 1 significant counter trend rally that remains pending. The S&P is a nothing burger because it does not factor into what I buy and sell on a day to day basis, so irreverent to my decision making process. at best it acts as a rough guide in terms of the overall direction of travel i.e. I expect this bull market to continue for at least another year so deep draw downs in target stocks should continue to prove temporary as they eventually look set to resolve to new bull market highs, in fact it is the analysis of the state of play of each individual stock that acts to determine where we stand in terms of the S&P's trend i.e. I can see the EGF's metrics and stock price trends and thus I can conclude that the indices such as the S&P and Nasdaq should therefore continue trending higher, conversely I saw earlier in the year that the likes of AMAT, Qualcom,.AMD.... had FOMO 'd far ahead of their metrics putting them into very overvalued states and thus should experience corrections that will likely put a drag on the indices, which thus factors into my analysis of the indices.
So I tend to do the opposite of most analysts, they see the S&P as the main actor whereas I see it as a sideshow as my interest is in accumulating and distributing individual stocks which is why I don't fall into the trap of what often gets asked in the comments "Nadeem why are you buying AMD now if you expect the S&P to keep falling into September" Where rather than repeat what I just wrote my response tends to be "because the S&P is a nothing burger" and we can see that in this trend forecast chart where we had the S&P climb higher to new highs into Mid July BUT key juicy fruity target stocks such as AMD and Qualcom were already well into their corrections and thus the observed pattern in target stocks is that of the S&P trend forecast which should make sense in that S&P expected pattern is in large part derived from what I expect target stocks to do. Furthermore such disparate trends also present opportunities to TRIM and BUY as we got second bites at the cherry across the spectrum of AI tech stocks to trim going into the Mid July S&P top ahead of the current decline as Qualcom's opportune Mid July pump to $210 illustrates, now $179 destined for sub $170.
Again be warned not to make the mistake of using the S&P expected trend as a primary decision making tool of what to buy or sell as it will work against you, especially as is the case right now as AI tech stocks tend to usually LEAD the indices. So for instance waiting for the S&P to top before trimming would have been a huge mistake as will be waiting for the S&P correction to run it's course before buying, instead seek to capitalise on individual opportunities as the opps come along,
Bottom line S&P correction targets a trend to between 5060 and 5000 by approx Mid September before the bull market resumes, where as I wrote in my last article the catalyst for the rally will be a Fed rate cut, the first of a series.
AI Tech Stocks Portfolio
July has been a busy month in terms of buying and selling with a lot of activity in the portfolio so two weeks away in Dubai did not mean I was not active adding and amending limit orders as the fruit machines were going kaching kaching and deep draw downs in the likes of AMD delivering opportunities to accumulate.
The spreadsheet has been updated to reflect the current state of my exposure in each stock and more importantly updated are the EGF levels and resulting direction of travel for the stocks that have reported earnings to date. A reminder of what the direction of travel column R is, it compares the current post earnings EGF to that of the pre earnings EGF of 25th of June and thus gives an indication of the direction of travel for the EGF post earnings,
Columns Q through to V indicate what to expect for each stock which is why I consider the S&P, Nasdaq and Dow to be a nothing burgers because each stock tells a different tale both in terms of trend and metrics i.e. Nvidia is clearly a better buy than Google right now as is TSMC. Whilst AMD at $140 is delivering deep draw downs that bodes well to capitalise upon later in the year.
The buying ranges have also been updated for most target stocks, a reminder this is where I would seek to accumulate more based on both exposure and probability of being achieved, so where one actually buys depends on how much one holds in terms of target exposure. Nevertheless given that most stocks have already corrected to some degree places many stocks either in or near the top of their buying ranges, which is where one would expect stocks to be trading at this point during the correction.
Spreadsheet link - https://docs.google.com/spreadsheets/d/1h9WcWdB4jw2yYlOEinoigRGtO-Z8MIkMo87Iyn4qHyY/edit?usp=sharing
Q2 Earnings
30th July - AMD $140 EGF -14%, -5%%, Dir -14%,PE Range 88%, High -39%.
The EGF's correctly flagged that AMD was heading for a deep draw down where I imagined months ago and wrote in the comments that it could trade down to as low as $110, though that it is a lot easier to repeat at $140 then at say $185. However my primary accumulation zone for AMD has been for between $130 and $150 and hence my position has ballooned from about 35% invested to 62% and the lower it goes the more I will add, if it gets to anywhere near $110 I will be back to 100% invested. AMD reports today which as the EGF's suggest should result in an earnings miss but the stock is already down a whopping 40% from it's high, so whilst it will be volatile, I suspect it could even rally on bad earnings when the market re-opens tomorrow. Let that sink in a 40% deviation from it's BULL MARKET high! Accumulation and Trimming may be hard work but it definitely pays off in the likes of AMD and many other stocks, so as I often state, you get out what you put in and the next best thing to a time machine is to accumulate and distribute as you go along, imagine those who sold nothing in the run up to $225 now could experience as much as a 50% draw down from the high, remember you cannot act with the benefit of hindsight! I suspect AMD could trade down to about $125.
30th July - MSFT $427 EGF 1%, 8%, Dir 0%,PE Range 88%, High -9%
There are stocks I find easy to accumulate into and trim and then there are those like Microsoft that I find difficult as it tends to fail to deliver meaningful opps to accumulate. The EGF's point to a small earnings beat, I doubt it will move much on it's own just trend inline with the market. I hold 11% of target so will seek to lightly accumulate in it's buying range, I think we will be lucky to see sub $400. Where would I do a big buy? At around $372 so it does not look like that's going to happen during this correction. On the plus side it is trading at 88% of it's PE range so better value than others such as META that trades at 119%.
31st July - META $466 EGF 6%, 22%, Dir 0%, PE Range 119%, High -14%
META points to an earnings beat but tends to be very volatile around earnings, I remember the Feb 2022 earnings blood bath when it literally collapsed from about $320 and did not stop falling until it hit $190, so definitely can be very volatile. The stock is trading at -14% deviation from it's high so I will accumulate as it falls towards $400, and it would be nice if it dipped below $400 but regardless of Clown Cramer stating META was finished at $100, it is a very good AI stock so I will take whatever opp META giveths to up my exposure from 34% invested though at 3.7% of portfolio it remains my largest holding as META attempts to beat OpenAI with their open source LLM's.
31st July - LRCX $903 EGF 9%, 15%, Dir 0%, PE Range 172%, High -21%
The EGF's are great but like AMD LRCX went a bit nuts to the upside, so don't let that -21% deviation from the high fool you, it is still very expensive. So despite beating earnings LRCX could take a further tumble where a break below $860 would target $800. I have been lightly buying LRCX as I rebuild my position after heavy trimming on it's mania to $1134, so I will continue to lightly accumulate towards 30% invested, holding off for the likes of $730 for bigger buys. So given the metrics I think there is a good chance LRCX will soon see sub $800.
31st July - WDC $66 EGF -200%, -206%%, Dir -5%, High -42%
The metrics point out anomalies in price action, and given very bad metrics we clearly got seriously lucky that the AI gods picked this stock for AI MANIA to offload into all the way to $81.6. Of course it is because of the storage devices for the data centres which will translate into REAL EARNINGS, but all of that is already baked into the price hence why WDC will likely fall on very good earnings and probably trade to sub $60, having cut my exposure hard I will accumulate WDC in it's buying range of $64 to $54 as AI mania is not over yet! Just taking a timely breather as is the WDC stock price.
1st August - Amazon $183 EGF 19%, 43%, Dir 0%, PE Range -20%, High -9%
Very strong EGFS point to an earnings beat. Amazon is only 9% off it's high so given that we are in a correction may not be able to sustain an earnings bounce to more than about $188.I suspect we will soon see amazon trade below $170 where the bottom of the range ($154) looks achievable, however such a move would prove temporary given it's PE range is -20% hence why I have resisted the urge to trim and stand at 56% invested, eager to increase exposure in the worlds biggest cloud company. Amazon is a machine that eats other business models.
1st August - Apple $218 EGF -11%, 9%, Dir 0%,PE Range 145%, High -8%
EGF suggests an earnings miss so stock price should drop but Apple is supported by continuing strong buy backs so it's hard to see the stock deviate much to the downside, I think we will be lucky to see sub $200. I don't like Apple because it lacks growth so seek a significant discount to buy, something like sub $170, which I doubt we will see during this correction.
1st August - Arrow $124 EGF -39%, -17%, Dir 0%, PE Range 65%, High -16%
Very bad EGF's are warning of an earnings miss so likely to take a dump, luckily we have known bad earnings have been coming for some time (EGF's) in advance of which the market gave us a recent rally to $134 to trim into. On the plus side ARW is a range trader with the narrow range of buy $118 sell $134, and a wider range of buy $110, sell $142. Currently it looks likely to target $118, on break of which will target $110 where I will seek to add more to rinse and repeat and trim at $134 and $142.
6th August - CRUS $131 EGF -44%, -2%, Dir 0%, PE Range 78%, High -8%
Medium risk CRUS has been on an epic bull run over the past 3 months from an April low of $81 to July high of $143, this on the back of bad metrics that for the duration of the rally have been warning of an earning miss hence I took the opp to trim CRUS hard from 70% invested down to 17%. As is the case with WDC it's all to do with AI, but unlike WDC I am not seeing this translate into increased earnings. Looking at the chart I can easily see CRUS retracing back down to at least $110 on break below to between $93 to $85, so there is a lot of potential downside for CRUS. So if you hold CRUS and are thinking of trimming some more do it sooner rather than later.
7th August - Qualcom $179 EGF 3%, 15%, Dir 0%,PE Range 78%, High -22%
QCOM has good metrics, positive EGFs, at 78% of it's PE range and is trading 22% below it's recent all time high, thus I have been accumulating Qualcom as it drops.Yes $179 is a lot higher than the $105 one could have repeatedly bought Qualcom for during 2023 but that ship has long since sailed. In terms of a deeper buying opp to than $179, Qualcom should trade into the $174 to $156 buying range where we will only know how low with the benefit of hindsight baring in mind Qualcom is already trading at 22% below it's recent high. I am currently 65% invested and will add more within it's buying range with the price chart suggesting $166 should be achievable. The bottom line is that Qualcom at $179 is at fair value and the EGF's suggest an earnings beat so the correction should prove temporary so take any dip into the 160's as an opp to accumulate what one trimmed over $210.
7th August - GPN $101 EGF 4%, 17%, Dir 0%,PE Range -271%, High -54%
And last but not least GPN, good metrics but so far has failed to budge far from it's bear market floor. Maybe sector rotation under way from tech to smaller caps will breath some life into this stock. EGF's suggest an earning beat and current trend is out performing the general market as GPN lifts itself off it's bear market floor for the fourth time, having spent the past year stuck in a range of $94 to $135 which whilst it has delivered opps to trim and rebuy, nevertheless has not resulted in the bull market that the metrics suggest should transpire that thus remains pending, just as Qualcom's bull market remained pending for a whole year until it took of like a rocket. I am 189% invested so eager to start trimming north of $120 with an eye on $135 until GPN experiences it's QCOM moment..
Google $171 EGF +7%, +17%, Dir -8%,PE Range 66%, High -11%.
Post earnings - Google's direction of travel is now negative which states to expect Google to under perform vs it's previous trend to it's recent all time high vs what will transpire over the next few months in the run up to Google's next earnings which thus will prompt me to seek a deeper correction to accumulate into as well as act to trim on any price spike. So personally I will hold off on larger buys towards the bottom of it's buying range of $166 to $150.
Preparing for the Next Bear Market
Despite no signs of this bull market ending anytime soon I am already working an a strategy to survive and prosper during the the next bear market where my objective will be to improve on what I did during the last bear market that amounted to having a mountain of dollars sat in the likes of Paypal that I would convert into sterling whenever I bought stocks, though I ran out of those dollars during April 2022 which was well before the worst of sterling's collapse that further dropped from $1.3 to parity to the dollar. Also despite calling the top and accurately gauging the depth and length of the bear market, shorting individual stocks did NOT pan out as well as expected, yes there were a few big wins such as shorting Nvidia and Tesla. but overall it was very disappointing. It is too complicated to do both, short stocks and accumulate stocks during a bear market.
So the strategy will be to use a chunk of the anticipated cash mountain of about 40% to 60% of portfolio to start hedging towards the end of this bull market thus aiming to identify -
1. A short S&P Fund that is not leveraged.
2. Accumulate Dollars in short dated bond and dollar cash ETFs as sterling tends to fall during stocks bear markets.
Thus a far less complex strategy than trying to short individual stocks, as I will use the exact same strategies of accumulation and distribution as I use with any stock, so I will accumulate into the short S&P fund BEFORE the stock market tops and continue to do so buying and trimming the fund during the bear market peaks and troughs. At worst I will start accumulating a year before the top, at best I will start accumulating 3 months before the top, we will only know THE TOP with the benefit of hindsight unless I get lucky again! However there is a positive element to this strategy in that even if the S&P climbs higher by say another 20% after I have started accumulating into the S&P short ETF, and thus I have say a 10% average draw down. However if the S&P goes up then so should also sterling which means the sterling value of the S&P will be LESS and thus the actual draw down could be half that of the dollar rise in the S&P draw down so about 5%.
Whilst during the bear market sterling will fall thus similarly exaggerate the profit made during the bear market by likely as much as 35%, so if the S&P falls by say 20%, then this would imply a return of as much as 30% in sterling terms.
It's early days and much number crunching is to be done i.e. how much am I willing to risk to this strategy, I imagine the short S&P ETF position will be between 4% and 8% of portfolio. Whilst the safer USD cash / bonds position maybe 10% to 20% In the meantime I will do much testing behind the scenes because it's only when one actually does it in real time that one finds out all of the pros and cons. It should definitely beat shorting individual stocks, options and holding dollar cash on accounts such as paypal that charge an extortionate fee to convert to sterling so should deliver some returns during the next bear market towards hedging the draw down in the invested portfolio. I am going to keep it simple, short S&P ETF, cash and short dated USD ETFs.
This article was written over 4 days vs the usual 2 to 3 weeks, so fewer charts, graphs and images.
Your back from SPARTA (Dubai) analyst.
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Most Recent Analysis - Bitcoin Break Out, MSTR Rocket to the Moon! AI Tech Stocks Earnings Season
CONTENTS
Bitcoin Seasonal Trend
BItcoin Breaking Out
Bitcoin Big Picture
MSTR $272 �� ����️������������ ������
MSTR Dream For Some WIll be a Nightmare for Most!
AI Stocks Portfolio Earnings Season
30th - Microsoft $427 - EGF's +2%, +19%, Dir +1%, PE 36.2, PE Range 89% / 38%
30th - KLAC $674 - EGF's +15%, +30%, Dir +14%, PE 28, PE Range 170% / 104%
30th - GPN $101 EGF +11%, +12%, Dir +7%%, PE 9.1, PE Range -295% / -335%
31st - Arrow $134 EGF -25%, -5%, Dir +14%, PE 10, PE Range 92% / 104%
31st - AMAZON $188 - EGF's +12%, +25%, Dir -7%, PE 45 , PE Range -94% / -203%
31st - APPLE $233 - EGF's -11%, +8%, Dir 0%, PE 35 , PE Range +161% / +127%
BPMC has left the building.
The Coming AI IPO Bubble
ISRAELS NUCLEAR BLACKMAIL
The US Dollar is FINISHED MANTRA
Bonds SUCK!
The Housing Market 18 year / 18.6 Year Cycle
Recent analysis includes -
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump!
Stock Market October Correction Window Into Post US Election Rip the Face Off the Bears Rally
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Your buying the dips selling the rips analyst.
By Nadeem Walayat
Copyright © 2005-2024 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.
Nadeem Walayat has over 35 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.
Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.
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© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.
