I’ll look at the Charts more in a bit but from a quick look the astonishing run on the US Markets keeps going and yet more freshly minted All Time Highs were created at the Close on Friday 26th Jan. The UK and European Markets look a lot tamer, and it seems most likely that the strength in the US is a lot to do with Dollar Weakness - I haven’t (and probably won’t !!) looked closely for such an Inverse Correlation but it would certainly seem that way. I find this unnerving. It is not normal.
The worry of course is that as the US Markets get more and more stretched and more ‘Toppy’ the chances of a hefty drop must increase - I would strongly welcome some kind of ‘Consolidation’ move (either a bit of a small drop or simply going Sideways for a couple of weeks perhaps) just to remove some ‘Heat’ and get everyone to calm down a bit and think about what they are doing. Especially on Tech, Valuations must be getting quite a lot above their ‘Normal’ levels. We need a Healthy Consolidation.
How did I learn Charting stuff?
Some time ago a Reader emailed me with some Questions about how I learned to muck about with Charts and I have reproduced much of it here and added a lot to it. Apologies to that Reader if I did not ask your Permission to do this but I have been very careful to remove any references that might give away your Identity and you seem like a reasonable Chap so I am sure you will be happy that I share this around. And I am confident you will appreciate the improvements I have made to that original text !!
“The Trump Shutdown” is how Nancy Pelosi of the Democrats is labelling the latest fiasco with the US Government and clearly this is a direct attempt (which will most likely succeed) to blame Trump for the Shutdown.
As always this is really about Politics and the Democrats see a great opportunity to engineer the Shutdown and pin it on the President - and with Public support overwhelmingly on the side of an Amnesty for the DACA ‘Dreamers’, and with Trump’s Approval Ratings an all time low for a President after 1 year of Office, their timing is probably spot on. This also managed to disrupt Trump’s one year Anniversary celebrations and of course will set the Dems up nicely for the upcoming Mid-term Elections.
Wise Words from The Baron
I was reading Investors Chronicle from 12 January - 18th January 2018 (with Cover Story ‘Portfolio Secrets‘) and on page 24, in John Baron’s column, ’The Year Ahead’ he wrote this chunk of text about his approach regarding his Portfolios:
“Instead, Investors should remain loyal to tried and tested investment principles. When deciding the portfolios’ strategy, little attention is paid to short term market ’noise’ - from wherever it originates. The most important determinant is the ability of companies to create wealth and add value, and the conditions that sustain such an environment. The focus remains on the longer term when assessing sentiment and fundamentals, and volatility is therefore seen as an opportunity.
The astonishing Bull Run continues - I just updated my ShareScope Software prior to doing the Charts for this Blog and I noticed that the S&P500 had another strong move up on Friday and it has now pretty much had a continuous run of about 9 Days - all of 2018 so far in fact. It is Martin Luther King Day on Monday 15th January so the US Markets are closed.
Despite the overall strength I actually had a lucky escape and managed to eke out a Gain of 0.75% on my Portfolio Exposure (slightly higher if you look at Capital used obviously because of my Leverage on Spreadbets) - which is a pleasing outcome after getting hit with a Profit Warning from Moss Bros MOSB earlier in the Week and with Superdry SDRY (just changed name from Supergroup SGP) and Boohoo BOO both putting out decent Results but getting spanked anyway. The latter 2 are very big positions for me.
As always I never seem to have enough time to really think hard and focus on a Blog and I have one formulating in my mind about the Evolution of an Investor which should cover how we mature as Investors (and Traders to some extent) as the Years go by and what this means in terms of how we behave and how we deal with the Markets from a psychological and practical viewpoint. Hopefully in the Blog I eventually produce there should be a lot more to it than that but as things stand I am just not in the mood to start on that one so I am jumping into what I think will be a much more straightforward one and I can bash it out with little (if any !!) preparation.
This is one I have had in mind for years but only now am I finally getting round to it - silly really cos in truth it isn’t all that complicated although it is a hugely important Subject and I suspect Readers (especially Peeps early in their Investing Evolutionary Journey) will find it a really valuable and insightful concept.
It’s hard to believe we have only had 4 Trading Days of the New Year and yet my Portfolio was up 2.5% by the end of it - in the context of a Target of 10% for the Year this is clearly a blistering start and it is probably the best opening to a Year I can ever remember. I always ‘Zero’ my Numbers at the End of each Year and start a fresh Year with my ‘Profit’ at Zero in effect. The usual pattern is that my Profit goes negative for a few Days in early January and gradually it moves back into positive as the Month progresses - it can be quite unnerving so it is nice to already have a bit of a ‘cushion’ of Profit built up. I always like being ‘Ahead of the Game’…….
Webinar Monday 8th January
I was invited by Dale Pinkert to appear on his regular Webinar tomorrow at 1pm UK time - I am under the impression that it does get recorded and is available on YouTube later - I will look into this after the Show and put a Link on the Homepage somewhere for people who are unable to listen ‘Live’.
Compare at your Peril
After doing my ‘Scores on the Doors’ Blog for 2017 and seeing all the excellent Results that people have achieved on Twitter, it seems timely for me to bash out this Blog and try to put some context around the Returns that have been made and how we should best regard them in relation to our own achievements.
Boiled down to its smelly chicken bones, my contention is that we need to be dead careful when comparing our own Results with those achieved by others - on the positive side they can inspire us to do better but on the negative side they can give us some pretty disheartening and deflating impressions that are probably false and unrealistic.
Yes, to a large extent this is maybe yet another Psychology Blog…….
Scores on the Doors 2017
Unlike last year this Blog is not too painful to write as I have had a pretty decent year and made a fair bit of dosh through all my constant and excessive hard work (ha ha Wheelie, you were down the PUB for most of 2017). As usual I will follow a similar format to the SOD Blogs of previous years (it is hard to believe this is already the 4th one I have written) and hopefully it should all be clear and make some sort of sense.
As per the usual tradition with my SOD Blogs, I will set the scene with a Table of the Major Indexes and how they fared in 2016. This is the absolute level of the Indexes and does not include Dividends which would come on top - so all in all a flippin’ good year for the Markets (as per usual, if you click on the picture it should grow so that you can actually see it):
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