What a circus. Markets have been all over the place. Banknifty has been having its most volatile trades ever. So where are we right now? Basically, we are between hitting highs on new affected cases, markets struggling with lack of fund flow, and a positive news flow to head higher. Price action says that we are in a quite narrow range and a break on either side can be worth a directional trade.
A larger time frame shows that we are taking decent support at previous resistance levels to head higher. Looks like a potential trade but let's not make any bets so soon.
Nifty Metals have been heading in a linear trend that certainly could be indicating inflationary worries. The future will look different than how it looks now. But obviously, it will be better. This year, while being super depressing, has also been super cool! We have proven that society is capable of working from home, thus reducing the need to drive gas-guzzling cars around town for a commute, while simultaneously saving us an extra 2 hours a day in getting ready
Coming to the S&P 500 index. We're looking at companies like google and apple-producing or putting out buybacks. I mean google 50 billion dollars and apple 90 billion dollars earnings are fantastic we're looking at probably the best growth we've seen in 50 years and so you kind of start wondering why does the fed insists on continuing with emergency crisis QE what's the economic benefit?
Maybe they're keeping printing because they're concerned that just a hint of tapering would disturb this rally and as evaluations continue to be so extreme.
Weekly structure of the vix in the context of everything that is happening. Here in a larger rally, the vix is an interesting instrument. Most people think you cannot chart technicals on the vix but as shown over the years of data you actually can and just on this weekly chart you see that the vix tends to engage in these longer-term compression patterns that are marked by periods of consolidation at the low end and then you get these quick spikes and they repeat over time to lower highs and the pattern compresses and then you see these breakouts.
Today’s society is changing at a faster pace than ever before. This pace only seems to accelerate as time goes by. So is it really that shocking that many of us have commitment issues? With unlimited opportunities in every single direction and new options appearing constantly, why would anyone ever make a decision that goes further than the foreseeable future? Nobody expected Covid-19. But here we are, one year in, almost to the day, and most of us are fine. Things are different. But we are fine.
Life is not linear. It's unpredictable. Success does not lie at the end of the highway. You can take any route, as many exits, do a little road trip, circle back, take the scenic route, and as long as you are following your heart, nourishing your mind, learning as you go, and being a good person, you will get there.
My prayers go out to families and individuals struggling in difficult times. I'm sure there's light across every dark tunnel and the best of days and opportunities are on your way.
"You can't just give up! Is that what a dinosaur would do?" - Joey
Going forward, I will be making investments in companies that complement my vision of the future. This dip has provided a great opportunity for that. I will be reserving a few bucks for some BNFO on the side. But the trading style of the past year, I believe is gone - along with the weighted liquidity blanket that our government has provided us. It is time to put on our thinking caps and get to work!
Take care and stay safe.