STATE OF THE MARKETS
Market optimism remains in the driver seat while waiting for reality check. Other than S&P and Nasdaq that closed lower, major overall markets remain in optimism with the Dow breaking highest in 3 years at 29,478 followed by the commodities markets that are all in green. The benchmark 10Y yield was up 13 basis points, yielding 0.96% as demand for safe-haven waned.
Crude continue the rally to close 1.18% higher at $41.85/barrel while gold remains supported at the $1,880/oz after reaching the low of $1,850 when news of covid-19 vaccine broke-out.
In the FX space, optimism abound in the long and medium term accounts as USD, CHF and JPY are on the back burner. Kiwi is taking the lead when RBNZ decided to keep rate unchanged for now. Markets are expected to remain in sideways as players reposition themselves while waiting for the next catalysts.
G8 CURRENCIES SENTIMENTS
** ST refers to Short-Term which is daily turnover, MT is Medium Term which is
weekly and LT refers to Long-Term which is monthly turnover.
WALL ST MOST ACTIVE
|VOLUME||90 DAYS AVG|
** % Change here refer to price vs previous day price
WALL ST TOP FLOWS
|% CHANGE||FUNDS FLOW $|
** % change here refers to volume vs. 20 days average volume.
TOP 5 BLOCK ORDERS
|GC||1,873.50 – 1,876.10||gold futures||250||46.9M|
|CL||40.60 – 42.60||crude oil futures||3,980||195.2M|
OUR PICK – Tesla (TSLA, Nasdaq)
When reality sets in, Tesla will fall. We have long followed Tesla and it’s a classic example of “markets can remain irrational longer than you can remain solvent”. At more than 800 times of its earnings which is 100 times higher than the auto industry, it’s not a favored buy right now. Fair to say that it’s fairly valued at PEG of 2.39 which is about the range in the industry and at this point long term buyers are cashing in their profits and the stock is finding the next direction which we believe lower. Order flow suggested that the stock is under selling pressure with 21 and 8 days VPOC converged at $422.85, slightly higher than the monthly pivot $411.02. Sell on rally with $455 stop.
This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.