So....here we are post Brexit, world indices were severely jolted crushing key technical levels, uptrend has changed into downtrend, technical damage / breakdown is done. Here are the current picture of 3 major indices :
Dow down 3.64% in one day
S&P 500 down 3.82% in one day
Nasdaq down 4.13% in one day
Above factoring low of the day .......
When was the last time you recall Nasdaq being down 202+ point in a single day, in one day Nasdaq went below 50 & 200 DMA.....
S&P 500 and Dow are still above 200 DMA......
S&P 500 support is around 2020 area and also 200 DMA.......the question of the day IS......will it hold....
There is a good chance that all indices may close / go below 200 DMA....then recovery starts, it could all happen on Monday by close......
Many economists are trying to come up with winners and losers in Brexit......
UK is the-biggest loser as its currency Pound is under severe pressure which currently stands @ 1.3695 after going to 1.32 to US$...this is 52 wk low and high is 1.58.....
London real estate may be the next pressure point to the downside......
Europe may be the next casualty as evidence by Euro which currently stands @ 1.1095 to US$, low on Friday , high is 1.17 as 52 wk tally.....
US, Canada, Asia may not be impacted too much, just an adjustment to new reality of Brexit and its related breakup format.
Gold jumped to $1322.40 @ close, but was as high as $1362.60, but gave up those gains.......
VIX jumped to 25.76, high was 26.24........
Rational and analytical mind tells me that it was all a "major overreaction"
Friday being weekly option expiry, gave all the incentive to push everything lower to the max.....
We may recoup part of loss in a hurry on Monday......
Hopefully my optimistic scenario may workout as Monday unfolds.
It is important to know, which sectors is in dire condition.....it is financial stocks......
As long as you can stay away from those, damage can be contained in a very irrational environment.
Good luck with your own analysis and comfort level.
BLOG does NOT give buy or sell.
Saleem
8 comments:
Hi Saleem,
Sold FIT @ 12.60
The takeover potential exists but fundamentals seem mixed or even challenged.
Stocktrader
Hi Saleem,
Bought AVAV @ 29.14
This re-establishes the position after selling last week.
Stocktrader
Hi Stocktrader,
Good luck with AVAV.
Saleem
Hi Saleem,
Swapped HD @ 125.32 for Z @ 33.08
I wanted to shift the portfolio to higher beta within the sectors I liked.
Portfolio: TMF SPLK SODA NXPI WLH TASR OLED IBP Z GWPH AVAV
Stocktrader
Hi Stocktrader,
Good luck with Z...
Tripled my position in NTES @ $168.12
Saleem
Hi Saleem,
NTES looks like a great add here!
Stocktrader
Hi Saleem,
$VIX is still down on the day. Incredible considering the market damage. Definitely seems like a turnaround potential sign.
Stocktrader
Hi Stocktrader,
YES...i saw that also that VIX is down....that encouraged me to add NTES.....
S&P 500 is above 2000.....next target 2020.....
Saleem
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