This week volatility increased by the second half of the week. Like during week 35 it increased to over 20 on the VIX CBOE. This was anticipated since this weeks numbers sort of promised volatility. Since 8/27 NVDA has been in decline and the Technology Sector as a whole. Let us take a look at Semiconductors:
SOX ETF down -24% from the highs, NVDA -28%, AMD -42%, AVGO -25%, ARM -39%, SMCI -65%!
When looking at the plain numbers it seems NVDA and AVGO are best suited for a bounce when this sell off ends. Anyways these stocks are showing substantial losses in their shareprice and marketcap.
And still the hope is there for the AI and Semis to save the world. Amazing! However if we reach oversold areas under RSI 30 it can be time for a bounce in these techstocks. Maybe starting at the end of the coming week. But it depends on the numbers reported next week. We have the ISM Manufacturing Index on Tuesday, ISM Non-Manufacturing Index on Thursday and Non farm payrolls on Friday. That is important numbers. We also have major banks like BoA talking positive about NVDA. A major correction in the stockmarket will pave way for the Fed to cut rates. But lower rates is no guarantee for a new upleg in stocks. It might be very short-lived and the market will start asking for more help. You see the setup? We don´t know anything yet. We have to look at charts and follow trends.
PLTR Palantir Technologies inc has hold firm so far.
The trends are hard to find right now when many Sectors are at ATH. It could not have been a tougher time for me to start this trading blog. Stocks barely make it to a new Weekly before trend changes.
That is why we have the 1-2-3 Method! And that is why we also invest longterm in Resources and Gold.
The success of Great Bear Resources
In December 2021 Kinross Gold announced the acquisition of Great Bear Resources and their flagship Dixie project in the Red Lake mining district in Ontario at a shareprice of 29 CAD fully-diluted. Great Bear had completed more than 340,000 metres of drilling defining the resource. The reason Kinross bought Great Bear was because of the large, long-life mine complex, significant upside potential with positive and exciting drilling results. Dixie was located ideally in a highly attractive jurisdiction in the renowned Canadian Red Lake mining district. There was good infrastructure, power supply, roads and skilled labour available and Kinross had been actively involved in the project since 2018.
When I first had a look at Great Bear it was priced at 0,50 CAD. When Kinross bought it for 29 CAD it represented a percentual profit of 4700%. Of course I did not see that opportunity to the full extent, at that time, and I did not trade in a 1-2-3-Method trade. I was only in it for shorter time during that time from 2018 to 2021. This was at a time when Gold traded at around 1200-1300 US$/Oz in 2018 and up to 2000 US$/Oz in 2020 during the Covid-crises when GBR.V was taken over by KGC.
Today we have new opportunities at goldprice of around 2500 US$. Kinross is a strong company with great resources. The Goldminers operates in a more and more favourable environment in the market. But the Great Bears don´t grow on trees. You need lots of experience and research to find them.
A very bad investment in the mining business:
Ascot Resources Ltd. A terrible story with lots of financings and dillution and very few positive drill results. This is not what we want to see in the mining business.
The Sectors:
We still have six Sectors that are positive in all timeframes. Healthcare, Real Estate, Financial Services, Communication Services, Consumer Defensive and Utilities Sector. This is where we look for trading opportunities.
Interesting changes is going on in Technology Sector that is now negative in short term Daily and about to loose its Weekly. Industrials Sector show the same pattern.
Consumer Cyclical is negative in Daily, at 0 in Weekly and positive in Monthly.
Basic Materials and Energy Sector is short and medium term negative but positive Longterm.
In TSC Premium we aim to find the best companies and we will use top-class tools to invest in them! We are now very close to a real breakout for Gold and Silver miners and we will not miss this opportunity!
No comments:
Post a Comment