Past edition of the "What Ian Can See" WICS trading information newsletter.
Ian's weekly look at the world economic situation and his world view. Members get access to the current edition, archives, chart analysis and one-to-one mentoring on your trading.
January 12th 2020
Hello again, and a very Happy - if somewhat belated - New Year to you!
I hope you had an enjoyable festive season. Mine was enjoyable enough, but pretty frantic too, with family visits predominating. I spent very little time researching the markets, because there wasn't a great deal going on - and not going on for longer than usual because of Christmas falling mid week.
So are things hotting up now?
Not really, it has to be said. We're still dragging along in some kind of zombie-esque limbo as far as I can tell. Even Donald's attempt to drag Iran into some kind of war seems to have fizzled out for now, and it's all about climate-driven disaster and whether or not the two brain cells joined at the hip, will be taking up Canadian citizenship. I don't believe I have ever found market (in)action as boring as it is at the moment.
Will that change as this year progresses? I have no real idea, it has to be admitted. My Really Scary Granny's crystal ball seems to have gone to ground, and to quote Niels Bohr, "Predictions are difficult, especially when they're about the future."
Speaking of which (predictions and hotting up) this piece rather amused me over the festives.
Ho ho ho.
There again, periods of low volatility and general market malaise, are always followed by periods of frantic action (and vice versa) so we "should" be in for a pretty bumpy ride as the year progresses. Once this general complacency and belief that we have never had things so good, wears thin, "stuff" will happen. Not all good stuff, mind!
Boris of course has got his Brexit well under control, and although Mrs Von der Lying suggests Blighty will have to make lots of compromises in order to retain access to EU markets, she can whistle for them as far as I can tell. Germany is now so deep in recession it won't want to rock Britain's boat, and France is teetering on the brink of total anarchy. It seems to me that Boris is now holding all the negotiating cards. (I note that German car production in 2019 was the lowest in 23 years, while Markit's overall Eurozone PMI was the lowest in 6 years....)
Not that Blighty is exactly firing on all cylinders either though, with 140000 retail jobs gone during 2019, according to the Centre for Retail Research, with a lot more likely to disappear this year too. For example, I note that Asda is planning another "restructure", putting 2800 jobs at risk there.
In the bigger picture, one fairly major thing that happened and that nobody seems at all interested in, involves Swedish interest rates, which are no longer negative. That sounds boring altogether but it's actually pretty significant.
A sign of things to come! (And thank goodness.)
Across the Pond, Donald of course is so full of himself over the Iran business that he's even more twitterish than usual, and he anticipates being let off the hook anent impeachment (he will be - let off that is) and getting his second term as biggest cheese. Hmm, that latter situation will depend on whether the coming market crash happens before or after this autumn. Certainly, USA Inc is in pretty bad shape overall, despite the ongoing stock market euphoria.
As far as sillier things go, there were plenty of those to read about over the holiday period!
How about these "instagram influencers" (whatever the heck that means) who have been conned (not hard to do I suspect) into promoting a "health drink" the ingredients of which include something called hydrogen cyanide..... Idiots.
I noted too that a French company is bottling and selling desalinated sea water as a health drink. I bet Charlie Windsor wishes he had thought of that one!
Then there was the thing about these Australian bush fires, which of course have been caused by people failing to listen to Greta. Hmm, nearly 200 arsonist arrests so far...... Go figure!
And on the same topic, I wonder how many years have passed since the Grauniad started its "one year to save the planet" thing? I see that "crying wolf" hasn't worked in Montana either.
Another ho ho ho methinks!
Oh well, one day they may all be proven right, just as one day my doom-laden prophecies of a market crash will be proven right.........
Anyway, that's plenty to kick off 2020. Let's just hope as the year progresses, that volatility will increase substantially, because goodness knows it's hard to be profitable as traders when nothing is happening!
Onward then to a look at a few charts where we might be able to spot some opportunities. First there's Superdry, which put out a profits warning on Friday. The price dropped sharply but stopped bang on a previous low before staging quite a recovery. Now the "look" is very much that of a horizontal channel. Next, there's a falling wedge on the Hunting picture, so a push upwards is to be expected. Then there's the opposite on the Morgan Sindall chart - a rising wedge. Finally, the DJIA managed to hit 29000 on Thursday and Friday, giving the lie to my previous "big picture" rising wedge view thereof. Can it get to 30000? Or 50000? Somehow I doubt it, but there again I didn't think it could get above 20000! In fact of course it has been running on fumes for years, driven by QE and general public mania. Once it does begin to turn down properly, an awful lot of people are going to suffer. The horizontal blue line I have drawn marks a price that we should all be carefully watching......
That's your lot for this weekend then folks.
Next weekend (19th) I plan to produce the usual video updates but there will be no WICS, because son and family are arriving on a (literally) flying visit and will be with us from Friday am till Sunday, with airport to-ing and fro-ing to be done. The next ramblings will be on the 26th, but as above, keep an eye open for some video updates next weekend!
All the best
The rest of this post, which is the charts and analysis, is available to TEW course members only. Members receive the latest post, the archives, plus the manuals, video updates and one-to-one mentoring from Ian Williams via email.
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