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Comments of the Day
24 February 2021
Video commentary for February 23rd 2021
A link to today’s video commentary is posted in the Subscriber’s Area.
Some of the topics discussed include:Will speculators buy the dip in bitcoin, innovation, large cap growth? industrial resources remain firm, agriculture resurgent, emerging market steady
Johnson Says Pandemic End in Sight as He Plans U.K. Recovery
This article from Bloomberg may be of interest to subscribers. Here is a section:
“This road map should be cautious but also irreversible,” the prime minister told members of Parliament in London. “The end really is in sight and a wretched year will give way to a spring and a summer that will be very different and incomparably better than the picture we see around us today.”
While U.K. leisure and travel stocks jumped as Johnson revealed his timeline, he is already facing pressure to move faster after the economy endured its deepest recession in more than 300 years. Chancellor of the Exchequer Rishi Sunak will announce more support for pandemic-hit businesses in his budget next week.
Psychologically, we tend to remember the totality of an experience based upon how well it ended. That’s why bubbles are always remembered so negatively. People forget the euphoria of the advance and focus instead on the trauma of the subsequent decline.
As we exit lockdowns, worrying about mask protocols, handwashing and social distancing, will we now remember the pleasure of that first meal out, meeting up with friends, going to that first football game or concert more than the year of watching and waiting? In a couple of years, we might be yearning to spend more time with our families and a less hectic schedule.
Email of the day – on interest rate sensitivity and overbought conditions
At Greatest Risk from Higher Bond Yields? Eoin, we have seen some sizable sell offs in recent weeks from the hottest sectors such as Green Power, and the various Innovation Funds/ETFs as well as Electric Vehicle sector. As you’d pointed out, they are benefit from super low rates as growth is essentially free. What risk for EM though, which otherwise has been on cruise control of late? Today has seen a sizeable sell off, but is this just the first shot across the bow? Which of the EMs would you be most guarded against? What else might be at greatest risk given the run ups we have had in markets over the last 12 months?
The ARK Innovation ETF has pulled back by about 20% over the last six sessions. That’s a sizable pullback but the fund was up 383% since March 2020 so it was due some consolidation. This reaction has broken the 12-month sequence of higher reaction lows so the trend is no longer as consistent as it was on the way up.
Bitcoin Tumbles Below $50,000 as Fear Sweeps Through Crypto
This article by Joanna Ossinger and Olivia Raimonde for Bloomberg may be of interest to subscribers. Here is a section:
The cryptocurrency tanked as much 18% on Tuesday and traded around $48,750 as of 10:41 a.m. in New York. While the selloff only puts Bitcoin prices at the lowest in about two weeks, investors are starting to wonder whether it marks the start of a bigger retreat from crypto or simply represents volatility in an
“Today’s correction for crypto assets is part of a wider sell-off in markets globally, being driven by profit-taking,” said Simon Peters, a crypto-asset analyst at the trading platform eToro. “Investors are closing positions, which will have generated significant gains for many of them.”
Bitcoin has been battered by negative comments this week, with long-time skeptic and now Treasury Secretary Janet Yellen saying at a New York Times conference on Monday that the token is an “extremely inefficient way of conducting transactions.”
Bitcoin is a speculative asset. That’s why it is capable of such big moves on the upside. It is also extremely volatile and dependent on a continued swell of new investors turning up to buy at successively higher prices.
Eoin’s personal portfolio – stop triggered on hedge position
One of the most commonly asked questions by subscribers is how to find details of my open traders. In an effort to make it easier I will simply repost the latest summary daily until there is a change.
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