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Ahead of the Curve provides you with analysis and insight into today's global financial markets. The latest news and views from global stock, bond, commodity and FOREX markets are discussed. Rajveer Rawlin received his MBA in finance from the Cardiff Metropolitan University, Wales, UK. He is an avid market watcher having followed capital markets in the US and India since 1993. His research interests includes areas of Capital Markets, Banking, Investment Analysis and Portfolio Management and has over 20 years of experience in the above areas covering the US and Indian Markets. He has several publications in the above areas. The views expressed here are his own and should not be construed as advice to buy or sell securities.

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Sunday, 21 July 2019

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning July 22

Indicator
Weekly Level / Change
Implication for
S & P 500
Implication for Nifty*
S & P 500
2977, -1.23%
Bearish
Bearish
Nifty
11419, -1.15%
Neutral **
Bearish
China Shanghai Index
2924, -0.22%
Neutral
Neutral
Gold
1426, 0.58%
Bullish
Bullish
WTIC Crude
55.75, -7.41%
Bearish
Bearish
Copper
2.74, 1.74%
Bullish
Bullish
Baltic Dry Index
2170, 16.35%
Bullish
Bullish
Euro
1.1222, -0.43%
Neutral
Neutral
Dollar/Yen
107.71, -0.13%
Neutral
Neutral
Dow Transports
10604, -0.31%
Neutral
Neutral
High Yield (Bond)
108.12, -0.33%
Neutral
Neutral
US 10 year Bond Yield
2.06%, -3.14%
Bullish
Bullish
Nyse Summation Index
764, -2.25%
Bearish
Neutral
US Vix
14.45, 16.63%
Bearish
Bearish
Skew
126
Neutral
Neutral
20 DMA, S and P 500
2973, Above
Bullish
Neutral
50 DMA, S and P 500
2900, Above
Bullish
Neutral
200 DMA, S and P 500
2783, Above
Bullish
Neutral
20 DMA, Nifty
11706, Below
Neutral
Bearish
50 DMA, Nifty
11719, Below
Neutral
Bearish
200 DMA, Nifty
11125, Above
Neutral
Bullish
India Vix
12.52, 4.31%
Neutral
Bearish
Dollar/Rupee
68.86, 0.44%
Neutral
Neutral


Overall


S & P 500


Nifty

Bullish Indications
7
5
Bearish Indications
4
7
Outlook
Bullish
Bearish
Observation
The S and P 500 and the Nifty fell last week. Indicators are mixed for the week.
The markets are on the verge of a great depression style collapse. Watch those stops.
On the Horizon
US – GDP, Eurozone – ECB rate decision
*Nifty
India’s Benchmark Stock Market Index
Raw Data
Courtesy Stock charts, investing.com
**Neutral
Changes less than 0.5% are considered neutral


stock market signals july 22


The S and P 500 and the Nifty fell last week. Indicators are mixed for the upcoming week. QE forever from the FED is about to trigger the deflationary collapse of the century and we are very close to another top in global equity markets. The market is establishing a major top with non-conformations from the transports, other global indices and commodities. The trend is about to change from bullish to bearish and the markets are about to get smashed by a strong dollar. Looking for significant under performance in the Nifty going forward on rapidly deteriorating macros. A 5 year deflationary wave is about to start in key asset classes like the Euro, stocks and commodities amidst a number of bearish divergences and Hindenburg omens. We are on the verge of a multi-year great depression. The markets are still trading well over 3 standard deviations above their long term averages from which corrections usually result. Tail risk has been very high off late as the yield curve inverts. The critical levels to watch for the week are 2990 (up) and 2965 (down) on the S & P 500 and 11500 (up) and 11350 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets. You can check out last week’s report for a comparison. Love your thoughts and feedback.

Sunday, 14 July 2019

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning July 15

Indicator
Weekly Level / Change
Implication for
S & P 500
Implication for Nifty*
S & P 500
3014, 0.78%
Bullish
Bullish
Nifty
11553, -2.19%
Neutral **
Bearish
China Shanghai Index
2931, -2.67%
Bearish
Bearish
Gold
1418, 1.41%
Bullish
Bullish
WTIC Crude
60.37, 4.97%
Bullish
Bullish
Copper
2.70, 1.16%
Bullish
Bullish
Baltic Dry Index
1865, 7.18%
Bullish
Bullish
Euro
1.1271, 0.40%
Neutral
Neutral
Dollar/Yen
107.92, -0.53%
Bearish
Bearish
Dow Transports
10637, 1.45%
Bullish
Bullish
High Yield (Bond)
108.49, -0.11%
Neutral
Neutral
US 10 year Bond Yield
2.12%, 3.99%
Bearish
Bearish
Nyse Summation Index
782, 7.73%
Bullish
Neutral
US Vix
12.39, -6.70%
Bullish
Bullish
Skew
124
Neutral
Neutral
20 DMA, S and P 500
2953, Above
Bullish
Neutral
50 DMA, S and P 500
2891, Above
Bullish
Neutral
200 DMA, S and P 500
2781, Above
Bullish
Neutral
20 DMA, Nifty
11739, Below
Neutral
Bearish
50 DMA, Nifty
11709, Below
Neutral
Bearish
200 DMA, Nifty
11113, Above
Neutral
Bullish
India Vix
12.00, -8.17%
Neutral
Bullish
Dollar/Rupee
68.56, 0.16%
Neutral
Neutral


Overall


S & P 500


Nifty

Bullish Indications
11
9
Bearish Indications
3
6
Outlook
Bullish
Bullish
Observation
The S and P 500 was up and the Nifty fell last week. Indicators are bullish for the week.
The markets are on the verge of a great depression style collapse. Watch those stops.
On the Horizon
UK – Employment data, CPI, Eurozone – CPI, China - GDP
*Nifty
India’s Benchmark Stock Market Index
Raw Data
Courtesy Stock charts, investing.com
**Neutral
Changes less than 0.5% are considered neutral


stock market signals july 15


The S and P 500 was up and the Nifty fell last week. Indicators are bullish for the upcoming week. QE forever from the FED is about to trigger the deflationary collapse of the century and we are very close to another top in global equity markets. The market is establishing a major top with non-conformations from the transports, other global indices and commodities. The trend is about to change from bullish to bearish and the markets are about to get smashed by a strong dollar. Looking for significant under performance in the Nifty going forward on rapidly deteriorating macros. A 5 year deflationary wave is about to start in key asset classes like the Euro, stocks and commodities amidst a number of bearish divergences and Hindenburg omens. We are on the verge of a multi-year great depression. The markets are still trading well over 3 standard deviations above their long term averages from which corrections usually result. Tail risk has been very high off late as the yield curve inverts. The critical levels to watch for the week are 3030 (up) and 3000 (down) on the S & P 500 and 11650 (up) and 11450 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets. You can check out last week’s report for a comparison. Love your thoughts and feedback.


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My Asset Allocation Strategy (Indian Market)

Cash - 40%
Bonds - 20%
Fixed deposit - 20%
Gold - 5%
Stocks - 10% ( Majority of this in dividend funds)
Other Asset Classes - 5%

My belief is that stocks are relatively overvalued compared to bonds and attractive buying opportunities can come along after 1-2 years. In a deflationary scenario no asset class does well other than U.S bonds, the U.S dollar and the Japanese yen, so better to be safe than sorry with high quality government bonds and fixed deposits. Cash is the king always. Of course this varies with the person's age.