About

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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Is a Recession Imminent?

Definition of a Recession: The textbook definition of a recession is two quarters of negative GDP growth. Some examples of recessions in...

Sunday, 12 January 2020

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning January 13

Indicator
Weekly Level / Change
Implication for
S & P 500
Implication for Nifty*
S & P 500
3265, 0.94%
Bullish
Bullish
Nifty
12257, 0.25%
Neutral **
Neutral
China Shanghai Index
3092, 0.28%
Neutral
Neutral
Gold
1563, 0.70%
Bullish
Bullish
WTIC Crude
59.12, -6.23%
Bearish
Bearish
Copper
2.81, 0.83%
Bullish
Bullish
Baltic Dry Index
774, -14.66%
Bearish
Bearish
Euro
1.1121,- 0.35%
Neutral
Neutral
Dollar/Yen
109.48, 1.28%
Bullish
Bullish
Dow Transports
10974, 0.57%
Bullish
Bullish
High Yield (Bond)
110.13, 0.21%
Neutral
Neutral
US 10 year Bond Yield
1.82%, 2.99%
Bearish
Bearish
Nyse Summation Index
923, 0.64%
Bullish
Neutral
US Vix
12.56, -10.41%
Bullish
Bullish
Skew
128
Neutral
Neutral
20 DMA, S and P 500
3224, Above
Bullish
Neutral
50 DMA, S and P 500
3153, Above
Bullish
Neutral
200 DMA, S and P 500
2983, Above
Bullish
Neutral
20 DMA, Nifty
12178, Above
Neutral
Bullish
50 DMA, Nifty
12049, Above
Neutral
Bullish
200 DMA, Nifty
11606, Above
Neutral
Bullish
S & P 500 P/E
24.47
Bearish
Neutral
Nifty P/E
28.51
Neutral
Bearish
India Vix
14.07, 10.89%
Neutral
Bearish
Dollar/Rupee
70.96, -1.13%
Neutral
Bullish


Overall


S & P 500


Nifty

Bullish Indications
10
10
Bearish Indications
4
5
Outlook
Bullish
Bullish
Observation
The S and P 500 was up and the Nifty was unchanged 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
Euro Zone – CPI, US – PPI, CPI, UK – GDP, CPI, China – CPI,
*Nifty
India’s Benchmark Stock Market Index
Raw Data
Courtesy Stock charts, investing.com, multpl.com, nse
**Neutral
Changes less than 0.5% are considered neutral


stock market signals january 13

The S and P 500 was up and the Nifty was unchanged last week. Indicators are mixed for the upcoming week. Long term, QE forever from the FED is about to trigger the deflationary collapse of the century and we are likely making another major top in global equity markets. The market is looking like the short of a life time with non-conformations from the transports, other global indices and commodities and insane valuations. A massive drop in the S and P 500 is likely. 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 over stretched valuations. 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 3280 (up) and 3250 (down) on the S & P 500 and 12350 (up) and 12150 (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, 5 January 2020

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning January 06

Indicator
Weekly Level / Change
Implication for
S & P 500
Implication for Nifty*
S & P 500
3235, -0.16%
Neutral
Neutral
Nifty
12227, -0.16%
Neutral **
Neutral
China Shanghai Index
3084, 2.62%
Bullish
Bullish
Gold
1555, 2.44%
Bullish
Bullish
WTIC Crude
63.03, 2.12%
Bullish
Bullish
Copper
2.78, -1.70%
Bearish
Bearish
Baltic Dry Index
907, -16.79%
Bearish
Bearish
Euro
1.1162,- 0.13%
Neutral
Neutral
Dollar/Yen
108.12, -1.20%
Bearish
Bearish
Dow Transports
10911, -0.23%
Neutral
Neutral
High Yield (Bond)
109.90, 0.32%
Neutral
Neutral
US 10 year Bond Yield
1.79%, -4.30%
Bullish
Bullish
Nyse Summation Index
918, 7.07%
Bullish
Neutral
US Vix
14.02, 4.39%
Bearish
Bearish
Skew
134
Bearish
Bearish
20 DMA, S and P 500
3194, Above
Bullish
Neutral
50 DMA, S and P 500
3130, Above
Bullish
Neutral
200 DMA, S and P 500
2972, Above
Bullish
Neutral
20 DMA, Nifty
12131, Above
Neutral
Bullish
50 DMA, Nifty
12006, Above
Neutral
Bullish
200 DMA, Nifty
11584, Above
Neutral
Bullish
S & P 500 P/E
24.24
Bearish
Neutral
Nifty P/E
28.44
Neutral
Bearish
India Vix
12.70, 20.62%
Neutral
Bearish
Dollar/Rupee
71.77, 0.44%
Neutral
Neutral


Overall


S & P 500


Nifty

Bullish Indications
8
7
Bearish Indications
6
7
Outlook
Bullish
Neutral
Observation
The S and P 500 and the Nifty were unchanged 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
Euro Zone – CPI, US – Employment data
*Nifty
India’s Benchmark Stock Market Index
Raw Data
Courtesy Stock charts, investing.com, multpl.com, nse
**Neutral
Changes less than 0.5% are considered neutral


stock market signals january 06


The S and P 500 and the Nifty were unchanged 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 likely making another major top in global equity markets. The market is looking like the short of a life time with non-conformations from the transports, other global indices and commodities and insane valuations. A massive drop in the S and P 500 looks imminent. 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 over stretched valuations. 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 3250 (up) and 3225 (down) on the S & P 500 and 12300 (up) and 12150 (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. I have added the P/E ratio valuation measures this week. 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.