China Stocks Selling Pressure Could Be Over, Now What?
Chris Vermeulen | Mar 17, 2022 09:44AM ET
This morning bottom pickers around the globe are snatching up what they believe to be “bargain basement priced stocks” as the Hang Seng Tech Index gained 9.1% during today’s March 16, 2022 trading session. It was the best day for the HSI since the 2008 financial crisis as the Chinese government pledged to support markets.
Tensions are running high as Chinese nickel giant Tsingshan Holding Group, the world’s biggest producer of nickel used in stainless steel and electric-vehicle batteries was sitting on $8 billion in trading losses.
According to the Wall Street Journal on March 9, 2022:
h2 ETFS Can Be Used Specifically For Seasons And Direction/h2
“The London Metal Exchange suspended the nickel market early last Tuesday, the first time it had paused trading in a metal contract since the collapse of an international tin cartel in 1985. The decision followed a near doubling in prices over a few hours.”
According to Statista on January 11, 2022, the assets managed by ETFs globally amounted to approximately 7.74 trillion U.S. dollars in 2020. With more than 8,000 ETFs to choose from, you can find just about any flavor you need or are looking for.
A Kondratieff Wave is a long-term economic cycle that consists of four sub-cycles or phases that are also known as Kondratieff Seasons. This theory was founded by Nikolai D. Kondratieff 1892-1938 (also spelled “Kondratiev”), a communist Russia-era economist who noticed agricultural commodities and metals experienced long-term cycles. The following graph illustrates both the inflation cycle as well as the best investments for each season.
The Kondratieff Seasons act as a general guide and each investment has their own specific bull or bear market cycle.
The following ETFs are not a recommendation to buy or sell but simply an illustration to emphasize the utilization of selecting an ETF for capital protection or potential appreciation in either a rising ‘BULL’ or falling ‘BEAR’ market.
From February 17, 2021, to March 14, 2022 the Direxion Daily FTSE China Bull 3X Shares (NYSE:YINN) lost -90.78%.
Target) Index: The FTSE China 50 consists of the 50 largest and most liquid public Chinese companies currently trading on the Hong Kong Stock Exchange as determined by the FTSE/Russell. Constituents in the Index are weighted based on total market value so that companies with larger total market values will generally have a greater weight in the Index. Index constituents are screened for liquidity, and weightings are capped to limit the concentration of any one stock in the Index. However, one cannot directly invest in an index.
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According to Direxion’s website , Leveraged and Inverse ETFs pursue leveraged investment objectives, which means they are riskier than alternatives that do not use leverage. They seek daily goals and should not be expected to track the underlying index over periods longer than one day. They are not suitable for all investors and should be utilized only by investors who understand leverage risk and who actively manage their investments.
From February 17, 2021, to March 14, 2022, The Direxion Daily FTSE China Bear 3X Shares (NYSE:YANG) gained +418.38%.
The rates of return shown for the YINN and YANG ETFs are not precise in that they are an estimation as displayed on a chart utilizing the charts measurement tool to emphasize my talking point.
In February, the inflation rate rose to 7.9% as food and energy costs pushed prices to their highest level in more than 40 years. If we exclude food and energy, core inflation still rose 6.4%, which was still the highest since August 1982. Gasoline, groceries, and housing were the biggest contributors to the CPI gain.
The FED was expected to raise interest rates by as much as 50 basis points. However, investors are speculating that due to the Russia—Ukraine war, the FED may be more cautious and raise rates by only 25 basis points.
h2 What Strategies Can Help You Navigate The Current Market Trends With US And China Stocks?/h2Learn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24 months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe we are seeing the markets beginning to transition away from the continued central bank support rally phase and have started a revaluation phase as global traders attempt to identify the next big trends. Precious Metals will likely start to act as a proper hedge as caution and concern start to drive traders/investors into metals, commodities, and other safe-havens.
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