S&P500 chart 12 Oct 18

STI has dropped almost 17% since 2 May! Is a bear market coming? (14 Oct 18)

Dear all, U.S. equity markets have logged their worst weekly performance in the past six months. For our local market, STI has dropped 16.7% from an intra-day high of 3,642 on 2 May 2018 to an intra-day low of 3,035 on 11 Oct 2018. It closed at 3,069 on 12 Oct 2018. Is a bear market coming? There are mixed views. Bears are saying that we have not reached the bottom yet. Some perma-bears are even saying this may be the start of the bear market. Bulls are saying that this represents a window of opportunity to accumulate stocks on […]

Cover pic

REC Insights Part 1 of 3: Prime Property at near Mass Market Prices? (26 Apr 18)

REC Insights is a 3 part series hopes to provide insights to investors looking for opportunities in the Singapore Property Market. These insights will be accompanied with detailed, straight to the point analysis. These insights are purely my personal opinion only and do not constitute any investment advice. In the previous article “5 things you must know before your next property investment” (Click HERE), I discussed about higher vacancy rates, rising interest rates and a potential oversupply situation from 2021 onwards. In addition to the previous discussed points, many Singaporeans would say that salary has not risen, or has not […]

S&P500 chart as of 29 Mar 18

Island reversal; potential Dow Theory sell signal… What does this mean for our markets? (30 Mar 18)

Dear all, Besides the headline grabbing news on Facebook and the U.S. China trade tariffs etc. some of you may have noticed other equally interesting / alarming headlines such as the island reversal chart formation seen in Nasdaq 100 (click HERE) and Nasdaq Composite index, and reports that a potential “Dow Theory” sell signal, one of the oldest and arguably the most widely followed market timing tool, may happen anytime (click HERE). What should we do? Let’s take a closer look at the charts and my personal action plan.   S&P500 closed 2,640. Day range 2,610 – 2,659 Based on […]

S&P500 chart as of 20 Mar 18

Markets – whipsawed by multiple events (20 Mar 18)

Our markets have been whipsawed by multiple events, such as rising inflation expectations and bond yields, protectionism (for e.g. Trade tariffs), upcoming FOMC meeting and sudden key personnel changes in the White House etc… How should we react or trade in current market conditions? Let’s take a look at the market events and the indices’ charts…   5 observations on the market Fed Chairman Jerome Powell’s first FOMC meeting tonight. A 25bps rate hike is almost certainly expected but markets will be scrutinising what the new Fed Chairman will be saying during the conference; Based on an article on Washington […]

Table 1_Top five stocks with the highest total potential return 10 Nov 17

Ernest’s market opinion (10 Nov 17)

Dear all STI has closed at 3,420, in line with my view that STI’s chart continues to be bullish (refer to my technical write-up on STI HERE), despite the elevated RSI.   1. Equities – still favour over bonds over 3-5 year time frame but… Personally, notwithstanding the market rally, I believe that over the long term, equities are still likely to outperform bonds and cash. Having said that, I am not telling all my clients to plough everything into stocks NOW, given that in the near term, there may not be significant catalysts to push the market higher by […]

sti-chart-as-of-23-sep-16

Ernest’s market outlook (23 Sep 16)

Dear readers, S&P500 reached my measured technical target of 2,120 and rebounded. STI continues to be trapped in a range. What’s next?   S&P500 Index Just to recap what I have mentioned on 9 Sep 2016 (see HERE), I wrote “The break below 2,157 on 9 Sep 2016 points to an eventual measured technical target of around 2,120. With this sharp plunge, RSI has declined from 59 on 19 Aug 2016 to around 32 on 9 Sep 2016. It is noteworthy that since Aug 2015, S&P500 typically staged a rebound when RSI reached around 27 – 32. Amid the sharp […]

question-marks-man-showing-confusion-unsure-29592217

Selling – When do you sell a stock (18 Sep 16)

Typically, when you read an analyst report, or a news article on a company, or when someone asks you to take a look at a stock with promising prospects, the decision to buy is usually easier, as you are buying on the prospect of potential gains. After your purchase, if the stock subsequently appreciates, or slumps, or stays around the same level for some time, you may wonder what to do with your existing stocks. Through my work as a remisier, I have received extremely frequent (and rather standard) questions from my clients (or sometimes readers), whether they should buy […]

dow-jones-drop-cartoon-color-390x220

Caution ahead? Most market strategists think so… (26 Aug 2016)

Dear readers, Various foreign houses such as Bank of America, Deutsche Bank, Goldman Sachs and UBS etc. are advocating caution in the markets ahead. Some of the commonly cited reasons are valuations; still weak corporate results; U.S. election etc. To be balanced, Morgan Stanley in its 12 Aug 2016 write-up said they continue to be bullish on equities. As you are aware, I operate my portfolio on a short term basis. Based on my views in my previous week market write-up dated 19 Aug 2016 (click HERE), I have reduced my equity allocation from 82% on 19 Aug 2016 to […]

STI chart as of 24 Jun 16

Ernest’s market outlook (24 Jun 16)

Dear readers, Are you burnt in the aftermath of THE BREXIT? What should you do now? To cut loss, hold or buy more? Before you make the decision, it is good to consider the various markets and how they are likely to fare in the next two weeks.   S&P500 Index Just to recap what I have mentioned on 10 Jun 2016 (see HERE), I wrote “Given the low ADX, S&P500 may trade between 2,034 – 2,106 (barring Brexit on 23 Jun 2016).” –> Although Brexit happens, S&P500 reached an intraday low of 2,033 on last Fri, just 1 point […]