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 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 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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Time Series Analysis with GRETL

This video shows key time-series analyses techniques such as ARIMA, Granger Causality, Co-integration, and VECM performed via GRETL. Key dia...

Sunday 22 March 2020

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning March 23

Indicator
Weekly Level / Change
Implication for
S & P 500
Implication for Nifty*
S & P 500
2305, -14.98%
Bearish
Bearish
Nifty
8746, -12.15%
Neutral **
Bearish
China Shanghai Index
2746, -4.91%
Bearish
Bearish
Gold
1501, -1.03%
Bearish
Bearish
WTIC Crude
23.66, -25.43%
Bearish
Bearish
Copper
2.15, -13.02%
Bearish
Bearish
Baltic Dry Index
625, -0.79%
Bearish
Bearish
Euro
1.0695, -3.70%
Bearish
Bearish
Dollar/Yen
110.82, 2.68%
Bullish
Bullish
Dow Transports
6838, -13.88%
Bearish
Bearish
High Yield (Bond)
86.14, -13.15%
Bearish
Bearish
US 10 year Bond Yield
0.94%, -16.18%
Bullish
Bullish
Nyse Summation Index
-1183, -4.53%
Bearish
Neutral
US Vix
66.04, 14.20%
Bearish
Bearish
Skew
118
Neutral
Neutral
20 DMA, S and P 500
2811, Below
Bearish
Neutral
50 DMA, S and P 500
3114, Below
Bearish
Neutral
200 DMA, S and P 500
3040, Below
Bearish
Neutral
20 DMA, Nifty
10513, Below
Neutral
Bearish
50 DMA, Nifty
11490, Below
Neutral
Bearish
200 DMA, Nifty
11577, Below
Neutral
Bearish
S & P 500 P/E
17.34
Neutral
Neutral
Nifty P/E
19.72
Neutral
Neutral
India Vix
67.10, 30.36%
Neutral
Bearish
Dollar/Rupee
75.40, 2.11%
Neutral
Bearish


Overall


S & P 500


Nifty

Bullish Indications
2
2
Bearish Indications
15
16
Outlook
Bearish
Bearish
Observation
The S and P 500 and the Nifty crashed last week. Indicators are bearish for the week.
The markets are on the verge of a great depression style collapse. Watch those stops.
On the Horizon
US – GDP, UK – CPI, BOE rate decision
*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 march 23


The S and P and the Nifty collapsed last week. Indicators are bearish for the coming week. A rally in the S & P is likely soon following the washout though downside risks could push it to 2100. Long term, the epic meltdown is set to continue resulting in a 5 year plus bear market. QE forever from the FED is about to trigger the deflationary collapse of the century and we have made a 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. Insane valuations continue. The breakdown in Crude and the Euro was a precursor to a massive drop in the S and P 500. The recent global virus epidemic (black swan) is likely to dent global GDP significantly and usher in a recession much faster than most think. The trend has changed from bullish to bearish and the markets are getting smashed by a strong dollar. Looking for significant under performance in the Nifty going forward on rapidly deteriorating macros. A 5 year deflationary wave has started 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 into a recession. The critical levels to watch for the week are 2320 (up) and 2290 (down) on the S & P 500 and 8850 (up) and 8650 (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 15 March 2020

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning March 16

Indicator
Weekly Level / Change
Implication for
S & P 500
Implication for Nifty*
S & P 500
2711, -8.79%
Bearish
Bearish
Nifty
9955, -9.41%
Neutral **
Bearish
China Shanghai Index
2887, -4.85%
Bearish
Bearish
Gold
1529, -8.57%
Bearish
Bearish
WTIC Crude
32.11, -22.21%
Bearish
Bearish
Copper
2.49, -3.11%
Bearish
Bearish
Baltic Dry Index
631, 2.27%
Bullish
Bullish
Euro
1.1106, -1.59%
Bearish
Bearish
Dollar/Yen
107.93, 2.48%
Bullish
Bullish
Dow Transports
7939, -11.35%
Bearish
Bearish
High Yield (Bond)
99.18, -6.12%
Bearish
Bearish
US 10 year Bond Yield
0.98%, 96.62%
Bearish
Bearish
Nyse Summation Index
-780, -214.15%
Bearish
Neutral
US Vix
57.83, 37.89%
Bearish
Bearish
Skew
132
Neutral
Neutral
20 DMA, S and P 500
3052, Below
Bearish
Neutral
50 DMA, S and P 500
3198, Below
Bearish
Neutral
200 DMA, S and P 500
3049, Below
Bearish
Neutral
20 DMA, Nifty
11354, Below
Neutral
Bearish
50 DMA, Nifty
11829, Below
Neutral
Bearish
200 DMA, Nifty
11654, Below
Neutral
Bearish
S & P 500 P/E
20.38
Bearish
Neutral
Nifty P/E
22.66
Neutral
Bearish
India Vix
51.47, 100.73%
Neutral
Bearish
Dollar/Rupee
73.84, -0.22%
Neutral
Neutral


Overall


S & P 500


Nifty

Bullish Indications
2
2
Bearish Indications
15
15
Outlook
Bearish
Bearish
Observation
The S and P 500 and the Nifty crashed last week. Indicators are bearish for the week.
The markets are on the verge of a great depression style collapse. Watch those stops.
On the Horizon
US – FOMC rate decision, Eurozone – CPI, UK – Employment data, China – PboC rate decision
*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 march 16


The S and P and the Nifty crashed last week. Indicators are bearish for the coming week. A 200 point rally in the S & P is likely soon after which we are likely to get a retest of the recent lows. Long term, the epic meltdown that just began is set to continue resulting in a 5 year plus bear market. QE forever from the FED is about to trigger the deflationary collapse of the century and we have made a 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. Insane valuations continue. The breakdown in Crude and the Euro is a likely a precursor to a massive drop in the S and P 500. The recent global virus epidemic (black swan) is likely to dent global GDP significantly and usher in a recession much faster than most think. The trend is about to change from bullish to bearish and the markets are about to get smashed by a rebounding 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 into a recession. The critical levels to watch for the week are 2725 (up) and 2700 (down) on the S & P 500 and 10050 (up) and 9850 (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.