About

Ahead of the Curve provides 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 is a PhD and 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 include capital markets, banking, investment analysis, and portfolio management, and he has over 20 years of experience in the above areas, covering the US and Indian markets. He has several publications in the above areas. He currently teaches business and management students at CHRIST University. The views expressed here are his own and should not be construed as advice to buy or sell securities.

Monday, 18 April 2016

Chart of the Day - Investor Credit

The chart of the day is from Advisorperspectives and it shows that Margin debt in investor accounts continues to be at alarming levels and has eclipsed levels seen prior to market melt downs in 2000 and 2008. Is history about to repeat itself again?

Sunday, 17 April 2016

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning April 18

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2081, 1.62%	Bullish	Bullish
Nifty	7850, 3.91%	Neutral**	Bullish
China Shanghai Index	3078, 3.12%	Bullish	Bullish
Gold	1236, -0.35%	Neutral	Neutral
WTIC Crude	41.75, 5.27%	Bullish	Bullish
Copper	2.15, 3.26%	Bullish	Bullish
Baltic Dry Index	635, 17.81%	Bullish	Bullish
Euro	1.126, -1.15%	Bearish	Bearish
Dollar/Yen	108.66, 0.55%	Bullish	Bullish
Dow Transports	7978, 3.13%	Bullish	Bullish
High Yield (ETF)	34.56, 1.23%	Bullish	Bullish
US 10 year Bond Yield	1.75%, 1.86%	Bearish	Bearish
Nyse Summation Index	1020, 8.46%	Bullish	Neutral
US Vix	13.62, -11.33%	Bullish	Bullish
20 DMA, S and P 500	2056, Above	Bullish	Neutral
50 DMA, S and P 500	1990, Above	Bullish	Neutral
200 DMA, S and P 500	2014, Above	Bullish	Neutral
20 DMA, Nifty	7646, Above	Neutral	Bullish
50 DMA, Nifty	7424, Above	Neutral	Bullish
200 DMA, Nifty	7873, Below	Neutral	Bearish
India Vix	16.03, -2.42%	Neutral	Bullish
Dollar/Rupee	66.61, 0.10%	Neutral	Neutral
Overall	S & P 500	Nifty
Bullish Indications	14	13
Bearish Indications	2	3
Outlook	Bullish	Bullish
Observation	The Sand P 500 and the Nifty rallied last week. Indicators are bullish. Markets are back at resistance. Time to tighten those stops as downside may resume any moment.
On the Horizon	New Zealand – CPI, Euro Zone – ZEW Survey, Rate decision, Canada – CPI

*Nifty	India’s Benchmark Stock Market Index
Raw Data	Courtesy Google finance, Stock charts, FXCM
**Neutral	Changes less than 0.5% are considered neutral

The US market and the Nifty rallied last week. Signals are bullish for the upcoming week. The Vix is suggesting complacency. The Yen is suggesting that global risk appetite is waning significantly. The markets are back at resistance and are likely to continue major breakdowns in 2016 as the recent rally is about to conclude. A big move is imminent. The critical levels to watch are 2090 (up) and 2070 (down) on the S & P and 7900 (up) and 7800 (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. You can also check out snapshots of the S and P 500 and Nifty Indices. Love your thoughts and feedback.

Wednesday, 13 April 2016

Chart of the Day - Great Depression of the 1930's

The chart of the day is courtesy MichaelMarkowski.net via Seeking Alpha and shows the stock market crash during the Great Depression of the 1930's. Are we going to have a repeat soon FED QE's not withstanding?

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.