Hi guys hope everyone's been well, thought I'd drop by quick.
Overall sentiment is base metals continue showing strength, as does gold (although stretched), global markets also look healthy and I feel lot of funds are waiting on a pullback before money is piled into spec end, M&A for commods have been good at big end but absolutely non-existent thus far in shell/nanocaps. Gold, Milk, Payment tech have done well last couple months so I'm expecting a transition of wealth soon.
WAF - Hasn't progressed too far, but that volume was a New York based hedge fund getting set which was good to see, really tried breakout strong yesterday but headwind as all the majors were stretched and dropped yesterday at the same time. PNR - Failed and stopped out MYX - Failed setup SIG - Failed setup NCZ - My "extended DT" rallied well, news followed the volume was a financing deal. Milk however has been highlight. CLV - Has been highlight. Previous chart below, yesterday made all time highs. A2M - Another one I could've managed bit better on, chart did amazing from the break into all time highs aswell yesterday.
--------------------------------------------------------------------------------------- 2. New setups I've watched from last couple days (entered few aswell) CAY - Chart from 19th Feb. I've entered on break, looks to be doing bit of consol. the quieter it gets (no supply) the better for another push.
SGQ - Copper/Nickel Player. Chart from 19th Feb.
TLG - Also chart from 19th Feb
MML - Gold producer, 95Kozpa production per annum at $1,500/oz AISC, assuming gold price at $1850 thats above $35M EBIT for a $77M Enterprise Value producer. I've taken entry here on the breakout. Chart from 20th Feb.
AGH - I've bought some this morning. Marijuana player, IPO done by one of the best PAC Partners, there last marijuana IPO did 2000%+ so they know what they're doing, they also were given IPO of the year for TTT. AGH signed a big distribution deal yesterday and what many haven't picked up on is Canberra has announced plans to become Cannabis capital of Australia: https://www.smh.com.au/business/small-business/green-wave-businesses-look-to-medicinal-cannabis-20190131-p50urp.html Couple articles came out last two days aswell. I'm carefully watching the marijuana sector, AGH seems first to emerge. Can see the structure within the chart, large volume pushes (yellow highlight) with exception of 15th Feb (supply), then quiet PB's or Consol (Blue boxes) before another push.
PLS - First one of the lithium majors to look good. Can see Selling Climax (SC), Backtest (BT), then what looks like a potential breakout coming. On high watch.
--------------------------------------------------------------------------------------------- 3. Macro stuff Firstly on my comments earlier about base metals Previously mentioned with Sector they are testing key levels, lead and copper had good backtests and copper managed to put on a very convincing breakout. Zinc bit scarier dipped slightly below backtest level but rallied back up immediately. Highlighted backtest levels in yellow.
Metals mining index rocketing likely due to base metal recovery, gold going bezerk, iron ore moving strong. Strongest sector thus far but yet to see as strong of a trickle down into nanocaps
Talk of town right now is coal ban. China banned australian coal imports on one major port yesterday. It did send panic through aus economy (coal being biggest revenue earner of $64B per annum) and the aussie dollar was smashed. I haven't checked yet but I do expect sell offs in coal companies too. Alot of the AUD smashing was pricing in the fact this might be the first of many bans, the positive is this particular port only affects 1.8% of total coal exports so not that much of a deal, most of the anxiety is due to the fact more bans could be coming.
US Markets: DOW is making a joke out of me, I keep wanting it to pullback but it just doesn't. Broken clock is right twice daily so perhaps at this resistance band it will slowly shift over. Daily and weekly chart below. Absolute savage bounce recovering gains, definitely a sign of strength for me. Just needs a healthy pullback to confirm.
Furthermore, U.S economy seems to trott along nicely. Two charts I like below. 1. Corporate profits for 31/12/18 continue pushing along. Only twice has US gone into recession without corporate profits dipping first as a leading indicator. 2. Chart below is job seeking vs job openings. Golden cross (in red circle) was made where job openings demand outweigh the labour force itself. This was followed by wage growth which has now spiked the unemployment rate and has worked as incentive for people to get off their couch and seek jobs. What looks bad is when job seeking increases, and jobs on offer decrease - insinuates lay offs and redundancy - this is complete opposite phenomenon which is healthy.
Downside of U.S economy is yields are weak, fed really softened up so longer term growth prospects are reduced, but the optimistic side is feds realised that market won't accept a hawkish tone. So they're doing their part to keep this market running.
Info out of US vs China trade talks this morning about officials having written an initial framework of 7 MOU's for resolution
Europe/Japan: Economic data is weaker in Europe but market index looks quite strong. I was quite concerned at the trend break (Orange circle) but turned out to be an undercut and reversal.
Japan looks great, trend held perfectly (similar to XJO)
Finally for our markets: XJO (weekly) that 10year bull channel held, savage bounce and looks like market is happy to continue along
XEC (Weekly) another even more savage bounce. I'm waiting for the first pullback from this bounce to add onto current fundamental spec positions. As mentioned above, feel the same for fundies and brokers, they likely wouldn't chase this extension (although it just keeps extending) but alot of wealth has been made post carnage that should be ready to be injected back into markets. Panic really set in at that undercut followed by bounce, now I await on the pullback to 1250 level and imo feel that would probably make for good buying & getting set.
(20min delay)
