Flash Update – October 28, 2020

Published on: October 28th, 2020

Events create risk and opportunity. When the time and date of an event is known but the outcome remains uncertain, it is wise to reflect on the risks and opportunities associated with it. An experienced CIO will consider whether positions on the book are just stale legacies of earlier enthusiasm or not. In that spirit, Julian reviews our portfolio for pre-election fine tuning.

Comments

  • JA
    Joseph A.
    28 October 2020 @ 16:14
    6 0
    GDX already hit the stop. I’m more interested in spot gold and silver because I suspected a breakdown of the recent bounce off 1865 and 22 respectively as tenuous. There were technical Fibonacci confluence support levels there for both but both also had much stronger confluence levels below and now that today is showing a sell off already, I should mention those key support levels again. For gold they are 1863-65 (the original support that gold bounced off), then 1824x3 levels which is significant that 3 converge so identically from a long term daily basis, then also just below that a few more around 1819-1821. I would like to see these lower levels reached before buying more gold. Same for silver breaking down from here I see support at the following levels 2380-87 and 2369-74, 2269-2279 which is a key one, then it’s 2196-2223 and 2007-2008. I can post this analysis in the exchange as a new post as I did with the Nasdaq trade levels which I’m still updating even as of today as an ongoing exercise in providing some technical analysis to the recommendations.
    • HM
      Harry M. | Real Vision
      28 October 2020 @ 19:31
      2 0
      Hi Joseph. I wouldnt wanna imply that you needed "permission". But you definitely have my blessing!
    • JA
      Joseph A.
      28 October 2020 @ 18:29
      0 0
      Harry I should add that I am looking for daily closes above these levels to confirm support and with a close higher than the open. If the market settles at 22 or just below on a daily that for me isn't necessarily an entry as it could easily drop to the next level in that case. Don't want to get too cute but also, bearing in mind the vol of silver, a daily move on strong buying can be huge as can the selling as we all know and have seen this year.
    • JA
      Joseph A.
      28 October 2020 @ 18:21
      0 0
      OK Harry thanks for feedback and permitting me to support the trade recommendations in the Exchange. The silver level I want to see is retest of 22 with my eye on 20 as per above. I just mention 2269-79 as it appears technically significant but as the market also previously reached 22 another retest would not surprise me at all and with expected increased volatility in the coming days 20 is very possible even as an extension of a drop to 22 given the vol of silver! I just updated the now defunct Nasdaq trade but decided to continue the analysis from the levels I derived anyway and updated today with a chart for a change. Will work on similar with the metals in a new post and include a chart for each from the outset.
    • HM
      Harry M. | Real Vision
      28 October 2020 @ 17:51
      2 0
      Great idea Joseph (re posting in the Exchange). JB sees very similar support/resistance for the metals, although I think in our levels for for silver we are looking for a bigger concession than you.
  • JA
    Joseph A.
    28 October 2020 @ 20:13
    1 0
    This is my Silver spot post in the exchange: https://exchange.realvision.com/post/silver-spot-technical-analysis-using-fibonacci-confluence-levels-with-refer--5f99c34a2d50676447afdb1a
  • JA
    Joseph A.
    28 October 2020 @ 20:14
    2 0
    and this is my gold spot technical analysis post in the Exchange: https://exchange.realvision.com/post/gold-spot-technical-analysis-to-go-with-trade-recommendation-flash-update-5f99cb5c3531ec395e837f28
  • JA
    Joseph A.
    28 October 2020 @ 20:16
    1 1
    ..and finally although defunct from a trade recommendation point of view I did continue to analyse it as I was already short the nasdaq before the trade recommendation came in and it proved useful to some members so I have kept the thread going updated even as of todays trading October 28th. For each update I have replied to my own thread so you can hopefully follow the analysis from inception: https://exchange.realvision.com/post/nasdaq-short-positioning-suggestions-based-on-fibonacci-confluence-resistan--5f71d6d7fbaaa77ad7bdd499
  • JM
    Jake M.
    28 October 2020 @ 21:56
    0 0
    Any update on Julian's position on the short QQQ recommendation he gave some weeks ago?
    • WM
      Wai M.
      29 October 2020 @ 11:33
      0 0
      it stopped out with 7% loss
    • HM
      Harry M. | Real Vision
      29 October 2020 @ 11:13
      7 0
      Sadly, it hit the stop on the close of October 9th. So if you are still in the trade you are not respecting stops, which is generally bad form. Despite the stop being hit, JB makes it clear that now is not a time to be very bullish on equities in his opinion. The update above is all about cutting risk, and updating stops. Risk assets are trading poorly in a number of markets. Covid is on the rise in multiple geographies, and the fiscal stimulus appears to be postponed until well after the election. Pretty much everything that made risk assets look like a good idea is not there now. Its a shame JB went short equities too early, but he remains cautious of equity risk.
  • DP
    Divyesh P.
    29 October 2020 @ 00:12
    0 0
    would love to hear more on TLT with regards to the differing views from Julian and RP
    • ly
      lena y.
      29 October 2020 @ 17:07
      1 0
      Yesterday with the market downed more than three percent, the bond market has little movement. Is it a sign of the price discovery gone? How valuable is such trade based on risk and reward? I don't trade options so it is hard for me to make judgement.
    • HM
      Harry M. | Real Vision
      29 October 2020 @ 11:01
      2 0
      You make a good point. JB explicitly recognized that RP and he were diverging on TLT. Interestingly, JB remains committed to the short, despite it having made money. Yes, he tightened the stop. But he didn't take profits and part of that is because he recognizes that one of the possible outcomes is aggressive fiscal reflation by a new administration. I would argue that this is one of the main differences between JB and RPs macro analysis. JB is more "optimistic" that the US authorities can force reflation with a large enough fiscal impulse. RP thinks that ultimately, government policy cannot (or is unlikely to) force inflation higher given the amounts of debt and the overall economic situation. As inflation comes down, the real interest rates will rise, tightening monetary policy.