High Heeled Traders

Hopeful

February 27, 2016

I rarely post on a weekend — most of the week I am busy with the kids, doing paperwork and research and some other projects. A girl needs to have some fun! I need to give time to protect myself from stress, get healthy and have fun so that it doesn’t take away focus on my trading when I need to. Imagine if you’re too busy and running on high energy all the time, ideas and numbers on your head all the time, the stress will get higher and higher and that’s going to affect how you think, how you make decisions. So weekends are for me (and I suggest for you) to chill, and have fun!

Anyway, I am writing this post to comment a bit on last night’s session. US GDP came out at 1% and G20 ministers financial discussions came into play. The market has been on this uptrend upbeat mood the last few days but I think last night investors have reached the point of profit-taking. The earnings season also just finished and well, the results have been so-so. No surprises there. So the next month being the end of the quarter is going to continue to be volatile, perhaps not as “bad” as the start of the quarter, but you need to be prepared to take your profits, vigilant and watch the market. News came out that it’s one of the thinnest trading days, that speaks volumes ūüôā not a lot of investors are “hopeful”.

My daughter has a favorite song these days, it’s called “Hopeful”. I don’t want to carry around this “hopeful” emotion on the days I am trading because it could affect how I trade. But I believe a “hopeful” emotion is still a helpful one, so that you and I can go on doing the right thing, moving forward. A hopeful weekend for you all!

http://www.bloomberg.com/news/articles/2016-02-26/budding-joy-over-u-s-stocks-rebound-marred-by-drop-in-trading

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Growth by Govs

February 26, 2016

Today United States GDP is going to be reported, so I did nothing big yesterday. Lately, wild swings have been in fashion so I decided that, this one is likely to follow the pattern. I am going to take the lower risk investment and just follow the market. You can see on the pricing of stock options that they are expensive, that they are expected to have really big swings. For example Facebook as of last night, with 2 nights to go before the week expires still carries a high premium. It is also unclear if this report if it turns out to be “good” will also be well-received. Investors are wary of “too strong” growth pushing up interest rates, but weak growth is also going to be bad news given the growth concerns elsewhere. IMF still expects the world to grow — although I read the article, front, back, middle and didn’t see which area is supposed to grow. MAYBE,,,, well, it’s tricky, the growth could just come from everyone, although in low-numbers,,,, 2% here, 3% there…. they said China will do 6% … Enough to chug along, keep interest rates low.

G20 met up today in Shanghai and I read briefly Germany and IMF wants growth on the rise, but through structural reforms (making people consume more and do more work for each other in local services) and kinda avoiding the full-on-fiscal stimulus strategy. Article here. Sounds good — grow your own legs, but don’t topple the balance (like what could happen with currency wars and capital outflows that happens in China). Governments have a responsibility to make their economies grow and though there have been missteps (need to remember the juicy details?!) Let’s hope these new policies all works out.

At our last workshop we discussed the short to medium-term market recovery, don’t miss out on the gains with my next workshop happening March 5. Here are the topics in this link!

Current Workshops

http://www.bloomberg.com/news/articles/2016-02-26/imf-s-lagarde-still-sees-growth-even-amid-growing-global-risks
————————-
Pay women more if you want to reduce povertyFont size: A | A | A
1:18 AM ET 2/25/16 | MarketWatch
By Jillian Berman

Dramatically reducing poverty could be as simple as paying women the same amount of money as men. There’s one problem: Taking that step isn’t all that simple.

If working women were paid the same amount as their male counterparts living in the same place, working the same hours, with the same education, their poverty rate would drop by more than half in 28 states, according to an analysis (http://www.statusofwomendata.org) released Thursday by the Institute for Women’s Policy Research, a think tank focused on women’s economic issues. To reach their conclusion, researchers analyzed government data to determine how much women would make if they got the same return on their resources — education, age, location etc. — as men. Then they calculated whether that added income would lift those women out of poverty.

Eliminating the gap in pay between working men and women would not only benefit the women making less, but it would help the families they support and the economy overall as well, said Heidi Hartmann, the president of IWPR. Closing the gender pay gap in every state would boost the U.S. economy by $482 billion, IWPR found.

“The low pay of women due to discrimination is a drag on the entire economy,” Hartmann said.

But unfortunately achieving equal pay for women is no easy task. Women make less money than men (http://www.marketwatch.com/story/gender-wage-gap-narrows-by-just-1-cent-2015-09-16) on average for a variety of reasons, Hartmann notes. They’re less likely to work in high-paying fields even and, when they do work in those sectors, they’re less likely to work at higher-paying firms or move up the corporate ladder. And then of course there are cases of outright discrimination where women are making less than men doing the same job.

“Change is required on so many levels, but each of those levels can be addressed,” Hartmann said. She noted that advocates have made some progress since the gender wage gap first began receiving national attention in the 1960s and there is hope the pace of change could speed up, thanks to new initiatives. For example, President Barack Obama issued an executive order earlier this year (http://www.nytimes.com/2016/01/29/us/politics/obama-moves-to-expand-rules-aimed-at-closing-gender-pay-gap.html) requiring that companies with more than 100 workers to report to the government what they pay workers by race and sex.

-Jillian Berman; 415-439-6400; AskNewswires@dowjones.com

> Dow Jones Newswires

February 25, 2016 01:18 ET (06:18 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.

http://www.bloomberg.com/news/articles/2016-02-25/biggest-wave-yet-of-u-s-oil-defaults-looms-as-bust-intensifies

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Follow Every Rainbow

February 24, 2016

It was fun while it lasted. As the market recovery has been going on, it is certainly not a smooth ride. There are bumps and jumps — yesterday the market shot up. Today, the market is in the mood to sell. Till yesterday, we could be forgiven to think that this market recovery is going to continue on a straight path. But as could be observed, the market was hitting resistance levels and you know that buyers are not pushing the prices up anymore — time to take profits.

OK so what does this mean for all of us? Remember the bull run is over. We are now in a bear market — in the US it has not fallen as a whole but a lot of stocks had already dipped by 20% from highest high which is the definition of bear market. There is no one trend also — the market is volatile. So if you position yourself and follow a trend – you need to be ready to take the profits quickly. If you are thinking a reversal is going to happen “anytime” – be patient and take that reversal only when following a confirmed move. Yes, follow every rainbow…

Too hard? Don’t be discouraged. We are allowed to be a little confused, however if we just check the data, it gets easier. We teach this in our workshops — but the general principle is —
1. Check the market direction
2. Decide on the strategy that works in this market type
3. Find the stocks that follow the market direction and yields an acceptable return on the strategy you apply.

OK so in real life – we check the market – we are in a Bear – volatile market. That means the major direction is going down. For this market – our strategy could be to buy only the safest stocks that people don’t want to sell (for the dividends, growing market share etc) at the Support level as much as possible. Or if “shorting strategies” are available to you, to sell the weak stocks and profit on the downside. We discuss the details in our workshops – the next events are on March 5.

Check out the topics here http://highheeledtraders.com/2015/11/20/current-workshops/

and you can register with me at charmel@highheeledtraders.com.


http://www.bloomberg.com/news/articles/2016-02-22/sovereign-wealth-funds-seen-selling-404-billion-of-equities

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Money Loves Company

February 17, 2016

OK this will be my post-Valentines blog entry because there were holidays in the US and China. ¬†I’ve decided that somehow the last few days developments in the finance world prove that “love makes the world go round” and for all the “doomsday” predictions — there is way out and up. ¬†I am talking about ¬†:

— Oil producers now talking amongst themselves (as opposed to not wanting to talk and leave the world oversupplied and credit-markets spooked, plus mention oil-producing governments and their citizens ¬†enduring budget cuts)

— China coming up with policy stimulating the economy without aggressive rate cuts (which avoids problems like more credit risks and capital outflows due to weakening currency). ¬† People’s Bank of China (PBOC) chair had also broken his silence, so you’d think they’ve figured something — that the yuan should be stabilized (article here). The major policy – a 5-year plan comes out in March.

— Central Banks — in “stimulus” mode. There’s Bank of Japan stimulating their economy surprisingly fast with ¬†“negative interest rates” — a novel idea which aims to have banks lend money instead of keeping it with the central bank for which they earn interest — ¬†meaning they are willing to do whatever it takes to help growth. European Central Bank also hinting at more stimulus in March, and US Federal Reserve just releasing its Minutes of the Meeting being wary of the softening global growth outlook so they are at least considering holding their fire with the interest rates — as I’ve said they would last year, given the bad effect of a strong dollar and trade with their neighbors China and Mexico — in this post “Bear Months”

Granting, these are all new developments and ¬†not yet proven to solve problems, but hey – that’s certainly a lot more positive than the start of the year when the investment scares started and pushed the stockmarket into bear territory and nobody wants to do anything.

Sure there is still negative sentiment in the market. I still see a lot of stories about the credit issues of debt-ridden commodity companies. That’s why we have to be invested in the right companies. Above 3% dividend yield is worth investing on. Steer clear of commodities companies though – those dividends may well be cut with the poor revenues. I’d stick to a careful selection of undervalued, dividend-paying stocks of strong sectors.

Remember money loves company, it will go to where it is treated well.

Learn these market signals, risk management and proven trading rules in my upcoming workshops that I am doing with Finance Manila and Learning Curve to help you invest with security and confidence!
More about the topics here.

Current Workshops

http://www.reuters.com/article/us-china-economy-idUSKCN0VQ0QY

http://www.reuters.com/article/us-china-economy-idUSKCN0VQ0QY

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Under Pressure

February 11, 2016

It used to be that the Federal Reserve Chair can talk up the economy. ¬† Last night Fed Chair Yellen had “very little” say about the global financial market shakedown. ¬† She just acknowledged the slowdown and that rates which have inched up last December will be affected — ahhh – slowly. ¬†There was no market-supportive action at all. ¬†We’d have to watch report after report fishing for clues. ¬†This uncertainty is enough to weaken the dollar though, and we are seeing it dip below what they said was Nov 2015 levels. ¬† I think for all the problems that are persisting, (and they are very big ones!) ¬†Chinese slowdown and existing problems, oil oversupply and sluggish major economies, we’re going to have to face the reality that the dollar and¬†stockmarkets¬†¬†could sag further.

Which is where we could be finding opportunities as US companies have been pointing out its strength is affecting their business. ¬†Pepsico, MSFT, some other multi-nationals. ¬†I think we would have to line up the “would-be winners” ¬† with the world facing ¬†slow growth everywhere. ¬†It was even reported Goldman Sachs abandoned 5 of 6 ¬†“top trades” for 2016 in the light of the wild markets and especially the dollar sagging.

(UPDATE 8:14  AM ET)

Global stocks¬† fell again today — with — surprise! Oil (now below $27) and Hong Kong stocks diving 3.9% ¬†fresh from the lunar New Year¬†holidays.¬†¬†You can guess what will happen with China mainland¬†stockmarket opens next week.¬† And more and more countries like Australia and India ¬†slipping into Bear market territory.¬† Rio Tinto (one of the biggest miners in the world) have cut their dividend¬†¬†— and you would think this is just the start – with¬† lesser mortals — ¬†miners, oil companies and¬†even banks¬†reporting dismal earnings (like 80%¬† plunge dismal) .¬† This bear market¬†has a few ways to go.¬† As I am all in cash position I view this market with detachment.¬†¬† I am just on the lookout for the next opportunity.¬† Recession talk (in the US) is also on the rise but in that there are still opportunities for defensive stocks — as I tell my friends — we all still need things to use and live — water, electricity, communications, and not to forget the bath soap!¬† So again, “Every opportunity has a difficulty, and every difficulty has an opportunity.‚ÄĚ

http://www.bloomberg.com/news/articles/2016-02-10/dollar-nurses-losses-on-yellen-rate-comments-oil-back-below-28

“The yen climbed for a fourth day as a Bloomberg gauge of dollar strength traded near its lowest level since November. The Hang Seng Index headed for its worst start to a lunar new year since 1994, while Korean shares dropped the most in more than three years. Futures on U.S. equity indexes dropped. Gold rose beyond $1,200 an ounce. U.S. oil dipped below $27 a barrel.”

http://www.bloomberg.com/news/articles/2016-02-10/dollar-nurses-losses-on-yellen-rate-comments-oil-back-below-28

http://www.bloomberg.com/news/articles/2016-02-10/yellen-says-legality-of-negative-u-s-interest-rates-in-question

<iframe width=”560″ height=”315″ src=”https://www.youtube.com/embed/YoDh_gHDvkk” frameborder=”0″ allowfullscreen></iframe>

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Patience Pays

February 9, 2016

Last week’s wild week threatens to continue this week, and we’ve been having this market condition since January. ¬†While I am seeing this as a bargain-hunting opportunity, I’ve also been saying you need to be smart and know what the market is doing, what’s behind the moves. ¬†Interest rates rising in the US Fed, China stockmarket instability, oil price declines – those are big issues, and as yet, haven’t been resolved, and notice, the risks are spreading > like from energy sector to financial sector. ¬†I get asked, isn’t low oil prices good? ¬†Consumers are definitely happy to pay less! ¬† I said indeed ¬†oil prices ¬†is good for consumers, so there is your opportunity. ¬†However, what’s happening now is that the low oil prices has gone down so much that there is a tendency for high-cost producers ¬†to fail paying their debts and that’s the risk spreading to financial companies. ¬† Oil producers dividends are also on the line so that’s more pain for ¬†the energy sector. ¬†Now with all these risk spreading, what we are seeing is that other “profitable positions” ¬†like in those FANG stocks, are being sold also. ¬†I shared in my talk last weekend that we are faced with global growth risks yet there are still something the governments (like China and the US) can do – in support of their economies — ¬†so we need to watch out for their policy statement ¬†Anyway, the prevailing market condition is bearish and if anyone does want to get into bargain hunting, ¬†be sure those are the ones performing in bearish conditions. ¬†Like utility companies, consumer necessities etc. ¬† We also need to stock on patience, for sure, patience is needed in this market.

I’m getting some virus / adware popping up so this will be short, pls

http://www.bloomberg.com/news/articles/2016-02-09/brace-yourself-global-stocks-are-close-to-a-bear-market-chart

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Stimulus Now!

February 1, 2016

All my kids got sick last week so after sleep-deprived days, I just had to cut all my holdings by Wednesday morning, moved to cash and put the market out of mind for a few days. Then the much-anticipated statement from the Federal Reserve came and disappointed investors. (I kinda sensed they would!) Then Friday rolled in and Bank of Japan did away with the need to make investors merely “hope” for stimulus – they actually provided the stimulus straight away with “negative rates” so people can borrow and buy. Previous week had the European Central Bank promise more stimulus.

OK so three Central Banks (of the biggest economies) had already made known their answer to the current market situation. Let’s round that up again :

1. Bank of Japan – stimulus implemented with negative rates.
2. US Fed – no commitment – March decision for rate rise
3. European Central Bank – stimulus promised in March

Now I would say the most important Central Bank to really address the issue (China being the originator of current market volatility) – the People’s Bank of China – had only come up with liquidity injections last week, supposedly for the Chinese New Year (CNY) celebration (and so far no help to the stockmarket). There has been no new policy, or no new spectacular rescues of the stockmarket although the last “statement” from Chinese officials in the World Economic Forum was a reassuring “we will take care of investors”. But nothing but silence after that. So I googled a little bit, and hmmm, I’m certainly not the only one noticing the silence from the policy makers. Check out the South China Morning Post article . ‚ÄúIf the policymaker knows something, if they have genuine signals, then they should communicate them to the market; if they themselves are confused, they should keep their mouths shut.‚ÄĚ The article also points out that while the PBOC Governor Zhou is a seasoned technocrat, it is increasingly likely that the economic decisions is being made by the party. Or that “Zhou‚Äôs silence could also reflect a change in China‚Äôs policymaking process.”

So I guess it’s another wait in the sidelines week. If they really want to think through the problems, my guess is that any real policy pronouncements will come after the CNY holidays. Although they’ve had a good few weeks after the disastrous start of January, we can’t discount the fact that any “stimulus” program announced this week will have the whole of China buzzing and that is always a good thing for how people view the government. It is highly likely they would announce a “stimulus” but what kind of stimulus is the question. Fingers crossed it helps in the structural change for long-term growth they are aiming for.

Anyway, so there’s still a lot of uncertainty — last Friday’s rally is being followed by another weak China economic report signalling manufacturing contraction. That stimulus better come soon. Serenity now!

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Growing Bargains

January 28, 2016

Just a quick post – the Philippine growth rate came out today – 6.3% from the last quarter ending in December and 5.8% for 2015. Article here. It is important to note that that growth have and will come from within — domestic consumption is strong, the election year will have government spending on infrastructure and it didn’t get mentioned in the article but services segment of the economy is a boost — services that is not only availed of domestically but also internationally earning US dollars, with the business process outsourcing industry – call centers and knowledge industries. Big banks like JP Morgan (US), Deutsche Bank (Germany), Macquarie Bank (Australia) have IT and back-office processing here that serves their global business.

This allows us to understand the transition that China is trying to accomplish.
1. Away from manufacturing which is dependent on other countries (export markets) buying from them
2. Consumption which facilitates the “exchange and circulation” of money / wealth among the locals.

In the case of the Philippines, the falling stockmarket – as a result of the “risk-off” attitude especially by foreign funds – is getting very attractive. This is because the companies that make up the stockmarket is rooted on the domestic consumption and services. None of those mining (of base metals) and oil — commodities that have been on a deep slide given the China and global growth problem. Many sectors like BPO industry, export (agricultural / garments) and Overseas Filipino Workers (OFWs) are also benefitting from the strength of the USD. Tourism sector (again boosting domestic consumption, services like in restaurants and USD) is also growing contributor – who can resist beaches and fun in the great outdoors, people’s hospitality and English widely spoken which are the many attractions of the Philippines.

So, falling stock prices but highly profitable companies make INCREDIBLE buying opportunity in the Philippines, and I’ve created a learning event called ‚ÄúBear Market Investing with Low-Risk High-Reward Investing Workshop‚ÄĚ which will equip you with a structured investing / trading approach, which includes knowledge on developing your business rules to get into the right investments and take profits as well as protecting your capital. We also discuss understanding the market, the strategies available and the risk management ideas ‚Äď specific, actionable and timely ideas you can easily implement!

Event : ‚ÄúBear Market Investing with Low-Risk High-Reward Investing Strategies Workshop‚ÄĚ
February 6, 2016 830am-12nn
Ortigas Building, Ortigas Ave. Pasig City
Early-Bird Rate : 1,500 pesos (Regular rate : 3,000 pesos)
Freebies : Full eBook of “High Heeled Traders (worth 800 pesos), Trading Kit (priceless!), two one-on-one structured consultation sessions for 30 minutes each. We will hold your hand as you start to invest to help you achieve added security and confidence!

To learn more about the workshop topics ‚Äď visit this link :

Current Workshops

Email charmel@highheeledtraders.com to register ! We want to focus on helping our investors so slots are limited and filling up fast. See you at the workshops.

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Bouncing and Checking

January 26, 2016

The talk of stimulus last week from the ECB and¬†Chinese officials¬† fuelled a big rally late¬†last week, which I couldn’t believe. I thought, I’d wait a little bit more to confirm whether this is already, as they say the “bottom”.¬†¬† Well, yesterday there was more fun in the morning following the¬†US, rally,¬†but the evening session with the EU and US brought I guess the “reality check” if this stimulus is really coming — no firm announcement yet — from Chinese officials over the weekend and until today — so, you guess it right, another down day! So down actually, Chinese stocks haven’t been at this level for 13 months. Article here.

Ahhhhh when will this end?!¬†¬† Have we reached the point of despair —¬† the “bottom of the bottom” — the “I’m not buying even if you pay me” stage? Do we dare test the strength of this bear market? ¬†¬† I had written an article about “testing the market strength” for a bull market in this link . Do you want to find out how far this bear will go? It’s not hard! Modern technology makes it easy – 2 taps in an app taking up only 2 seconds of your time that is well-spent Software solutions in commodity trading have made it easier for the public to trade anywhere, anytime.

So, go on, keep checking. My observation is that there will be some bear market rallies and an eventual turn around after some policy adjustments the Chinese government is cooking up. The stockmarket rescue efforts have not succeeded so far, and has been very expensive. However, as governments have done before, somehow they have to stimulate the economy, which revives growth and risk appetite. I’ve some “numbers” put out as key “Support” levels. I don’t really rely on those, I think like in bull markets, bear markets sentiment or “fear” is going to drive the trend. So yes, we will bounce around until they come out with that stimulus policy.
Keep calm under pressure and watch the market.

http://www.bloomberg.com/news/articles/2016-01-26/china-s-stocks-fall-amid-concern-capital-outflows-may-accelerate

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China’s GDP came out today — and surprise surprise!¬† There’s no surprise ūüôā¬† I think we all know all-along that it will be a slower growth, manufacturing and investments are going to be lower.¬† The positives being highlighted is that there is growth in consumption (from retail sales) and services (and non-manufacturing).¬† There is also broad expectation that the Chinese government will continue to have stimulus measures to help the economy grow at the pace to still sustain the population.

So do I predict a move up from here?¬† Most are expecting that the Chinese and other ¬†governments will counter the slowing global growth with¬†more stimulus.¬† That’s always¬† happened before. So there’s definitely¬†room for a move up.

Incidentally, I was asked in another forum what timeframe do I choose for Options because they do expire. I said given this volatile market, I choose between 1-2 weeks.   To which, the fellow said I have to have mad predicting skills in such a short time frame to be profitable.

No, I don’t have mad predicting skills.¬† I just enter when the risk – reward is attractive (3X what I risk), set my stop, when I am right, I enjoy the profitable run as much as I can. If I am wrong, I just get out as ¬†quickly as it hits my stop¬†which makes investors¬†become profitable.

So there are times that I don’t enter the market when I think the risk is too big – rather than¬†thinking alone that I am right or¬† wrong.

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