If the only way to reach risk-on in and remove social distancing is either via a vaccine (most preferred option although not really in scope till 2021) or further extreme lockdown measures (as you all know extremely costly and damaging to the monetary side) to completely remove the virus from circulation. With all roads towards confidence blockaded, it's more advisable to take a contrarian stance to the equity promoters.
This is not an easy one to add too. It depends on the circumstances next week, namely on the virus front as Europe looks set to follow the US and lose control. This is something I would like you all to anticipate: it is all too easy as for the Robinhood pawns who tend to be weak when tested.
The flows are as follows:
1️⃣ the flows themselves in US equities are open to attack
2️⃣ the final nail in the coffin comes from long bonds which are too much pressure to maintain: this means that the necessary complacency forces retail to buy all the junk while those smart enough unload and exert Puts / shorts.
Here the notion of parking capital in China in the short-term turns out to be deceptive and soft. Once more the reason can be found in the previous SHCOMP swings: in diagrams attached below you will see excellent examples of PBOC blockaders and failures.
Ride the PBOC, Feb 3rd 2020 The attempt to ride the CB flows, the hanging lows were relatively obvious and panic creates weakness which can be bought with confidence like passing clouds.
SHCOMP Market Commentary, Feb 24th 2020 The pullback was a result of the PBOC and sharp hands. Many moons ago I would've been convinced by this market...not today.
This leads to the long run choppy conditions and unfavourable outcome of soft hands who placed their stops too blatently. The sell side is still there on the move, ride weakness is the strategy and balance out at key support levels.
p.s. when i go out for chinese food around the corner, i often take the dish "the lucky pig", maybe one day there will be "the slaughtered pig" too ;-)
ridethepig
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Lol @ReallyMe ... the collapse is just a matter of 'when' now.
warrenbuffett123
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Update, my pain trade thesis seems intact LOL. Chinese markets are breaking out gg
warrenbuffett123
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Looks like you're the one getting slaughtered here mate HAHA! go learn fundamentals, TA doesn't tell u anything!
warrenbuffett123
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u need to learn fundamentals. these drawings dont make sense if u knew how to look at fundamentals LMAO! a beautiful drawing tho
ridethepig
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Thanks for the feedback @warrenbuffett123, what's missing from the view on the macro side in your opinion?
warrenbuffett123
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@ridethepig, look at all the economic leading indicators, why would the market fall if they've all rebounded and are in expansion lol
ridethepig
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@warrenbuffett123, which indicators are you referring to in particular?
warrenbuffett123
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@ridethepig, any basic leading indicator points to expansion. chinese market should take off 2H20 mate! What is your short thesis based on?
ridethepig
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We are still waiting for you to let us know which indicator(s) you want us to look at @warrenbuffett123
p.s. when i go out for chinese food around the corner, i often take the dish "the lucky pig", maybe one day there will be "the slaughtered pig" too ;-)