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Elliott Wave Analysis Of The NSE 20
Rank: Chief Joined: 8/4/2010 Posts: 8,977
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What incentive exists for investing at NSE if gok is willing to pay 1yr tbond @19.5% while NSE20 is down ytd around 18%? 19.5% return risk free in a yr will be grabbed by any fund manager without blinking! Then add the high returns of tbills and NSE is now faced with vapour volume support.  $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Veteran Joined: 8/10/2014 Posts: 977 Location: Kenya
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hisah wrote:snipermnoma wrote:hisah wrote:snipermnoma wrote:[quote=hisah]Bounce progress as expected. The real test will be if 4000 will hold on the next nosedive episode. That level has to hold if bulls are to survive!
Global equities are still undecided, but I expect another downside episode soon. Meanwhile USD to Kes. has been hovered around 105 for two weeks (one might say at least Kes is not sliding but with all the intervention why is it not improving either?) In the same two weeks NSE 20 has been in a narrow band 4125 to 4260. today 91 T-bill rate at 14.486%, higher than 182 T-bill which is at 13.861% and higher than the coupon on most bonds. This points to a recovery without legs. The steam will run out soon. I agree with @hisah 4000 will be tested with support at 3930.79 as per @mnandii post The money market is signalling stress! Interbank rate is above 20% again like in August while the 182 and 364 day tbills are getting undersubscribed. Nobody willing to pack money there at the current rates as 91 day rate is almost vaulting the 364 day rate! The dread inverted yield curve is almost striking home! A clear recession sign as liquidity squeeze continues. @hisah What a difference a week can make...and it came to pass 91 T-bill rate at 18.607% subscription 128% (link), higher than 182 at 14.551% subscription 5.31%, 364 at 16.301% subscription 11.31% (link). 1yr bond is 19.062% coupon (link). Meanwhile Interbank at 25.6398%. This points to stocks heading south. Liquidity vacuum! CBK is sitting on very sharp needles and attempting to smile! Yet most banks are profitable without liquidity this year!? Someone is applying thick layers of very glossy lipstick to look attractive!
Econ macros out of sync and now vapour liquidity, this is now beyond profit warnings window. [/quotel] Hahahahahahahhaahahaha....big banks will survive due to cheaper deposits, smaller ones nope...
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Global equities bullish signals are not encouraging at all. If there is a rally in 2016 that should be the last 'get out of jail' card! The bidless vacuum will likely be in 2016. @mnandii if we get to this confidence blackhole level gold and bitcoin will flip over in the opposite direction! Keep an eye this. I'll be loading up next year just as a guard against the global junk bond market turmoil coming soon. $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Sept closes @4189. Dismal bounce from the year low @4080. The weak bounce was due to selling pause, not solid buying. Like I've stated before, the real test is whether 4080 will hold as the test is coming. A break down will crater the remaining bulls. The money market short end fat rates should already warn the equity bulls that the next selling bout will likely overpower buying. Mpesa bank has surprised my expectation by not breaking sub 13 level. Buyers have been aggressive defending this zone. KES volatility has slowed down, but the weakness still lingers and remains above 100/$. Profit warnings will continue to weaken KES as the econ slump worsens. The buyers market is still here for a while. Cherry picking is now the challenge. I continue to fancy the bamburi bear shelter while awaiting kengen/kplc results. My golden handcuffs call still remains and I expect britam to break below the year low. Centum has too many rosy headlines; perfect trap for more selling! Eqty bounce still remains weak and now thin sim/telco setup is not a punchline! The market will always travel against the majority otherwise it'd seize to function! It must have a constant supply of many losers to pay/reward the few winners. This is how financial markets work! It's very difficult to make outsize gains by following what's popular. A good buying time will be towards election time when the negative sentiments will be ripe. But human psychology weakness makes it very hard for many to be contrarian in the markets in order to survive... Let's see how Q4 decides the year closure... $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Elder Joined: 10/11/2006 Posts: 2,304
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We are in October, the month when the worst stock market crashes have occurred. I believe if you are still long this market then your worst nightmare is straight ahead. 18th - 22nd should prove quite interesting. Conventional thinkers waste time building shelters when they are unnecessary and then have no shelters when they need them the most. Socionomists do the opposite.
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Rank: Elder Joined: 10/11/2006 Posts: 2,304
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hisah wrote:Sept closes @4189. Dismal bounce from the year low @4080. The weak bounce was due to selling pause, not solid buying. Like I've stated before, the real test is whether 4080 will hold as the test is coming. A break down will crater the remaining bulls. The money market short end fat rates should already warn the equity bulls that the next selling bout will likely overpower buying.
Mpesa bank has surprised my expectation by not breaking sub 13 level. Buyers have been aggressive defending this zone.
KES volatility has slowed down, but the weakness still lingers and remains above 100/$. Profit warnings will continue to weaken KES as the econ slump worsens.
The buyers market is still here for a while. Cherry picking is now the challenge. I continue to fancy the bamburi bear shelter while awaiting kengen/kplc results.
My golden handcuffs call still remains and I expect britam to break below the year low. Centum has too many rosy headlines; perfect trap for more selling! Eqty bounce still remains weak and now thin sim/telco setup is not a punchline!
The market will always travel against the majority otherwise it'd seize to function! It must have a constant supply of many losers to pay/reward the few winners. This is how financial markets work! It's very difficult to make outsize gains by following what's popular. A good buying time will be towards election time when the negative sentiments will be ripe. But human psychology weakness makes it very hard for many to be contrarian in the markets in order to survive...
Let's see how Q4 decides the year closure... Conventional thinkers waste time building shelters when they are unnecessary and then have no shelters when they need them the most. Socionomists do the opposite.
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Rank: Elder Joined: 10/11/2006 Posts: 2,304
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hisah wrote:Global equities bullish signals are not encouraging at all. If there is a rally in 2016 that should be the last 'get out of jail' card!
The bidless vacuum will likely be in 2016.
@mnandii if we get to this confidence blackhole level gold and bitcoin will flip over in the opposite direction! Keep an eye this. I'll be loading up next year just as a guard against the global junk bond market turmoil coming soon.  Must be a bull trap in the making! The market must hurt as many people as possible. Conventional thinkers waste time building shelters when they are unnecessary and then have no shelters when they need them the most. Socionomists do the opposite.
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Rank: Elder Joined: 10/11/2006 Posts: 2,304
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Safaricom and Social MoodSummary: Safaricom is at a historic top (Thus the latest attacks on Dominance). Don't hold this stock through the bear market. But if you insist on being long then prepare to be under water for at least one half and two years (or more  ). Quote from Pioneering Studies in Socionomics pgs 158 -159.  Quote:
Direction of Causality
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The social mood shift that occurs at the transition from bull market to bear includes a change in general attitudes toward the financial success of others. Society moves from a feeling of support toward one of resentment.
During a bull market, the social mood is directed toward rewarding achievement; during a bear market, it is directed toward punishing it. The bear market mood begins to creep into collective thinking late in a bull market. Democratic governments are instruments of egalitarianism. At some point, their representatives cannot stand watching some companies succeed wildly more than most others. When the bull market reaches exhaustion, the old supportive mood begins to crumble, and the new punitive mood bursts forth. One result of this metamorphosis in social character is governmental attacks against highly successful enterprises. In fact, they typically start with a major attack against the most successful enterprise of the time.
Safaricom Named 'Best Managed Company' In KenyaCA moves to Hire Market Dominance ConsultantAirtel Threatens Kenya Exit Over Safaricom 'Dominance'Wangusi Backs Off Bid To Check Safaricom DominanceSafaricom Dominance Splits Uhuru's MinistersConventional thinkers waste time building shelters when they are unnecessary and then have no shelters when they need them the most. Socionomists do the opposite.
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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@hisah. Nice recap. I continue to hide in mmf, I'm expecting a spike this month due to the ever rising interest rates. Looks like it will be a while before the market tanks proper. The investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: Elder Joined: 2/26/2012 Posts: 15,980
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mnandii wrote:Safaricom and Social MoodSummary: Safaricom is at a historic top (Thus the latest attacks on Dominance). Don't hold this stock through the bear market. But if you insist on being long then prepare to be under water for at least one half and two years (or more ). Quote from Pioneering Studies in Socionomics pgs 158 -159. Quote:
Direction of Causality
.....
The social mood shift that occurs at the transition from bull market to bear includes a change in general attitudes toward the financial success of others. Society moves from a feeling of support toward one of resentment.
During a bull market, the social mood is directed toward rewarding achievement; during a bear market, it is directed toward punishing it. The bear market mood begins to creep into collective thinking late in a bull market. Democratic governments are instruments of egalitarianism. At some point, their representatives cannot stand watching some companies succeed wildly more than most others. When the bull market reaches exhaustion, the old supportive mood begins to crumble, and the new punitive mood bursts forth. One result of this metamorphosis in social character is governmental attacks against highly successful enterprises. In fact, they typically start with a major attack against the most successful enterprise of the time.
Safaricom Named 'Best Managed Company' In KenyaCA moves to Hire Market Dominance ConsultantAirtel Threatens Kenya Exit Over Safaricom 'Dominance'Wangusi Backs Off Bid To Check Safaricom DominanceSafaricom Dominance Splits Uhuru's Ministers You missed this one. In any case, shouldn't people buy blue chip companies in a bear? "There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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Rank: Elder Joined: 10/11/2006 Posts: 2,304
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murchr wrote:mnandii wrote:Safaricom and Social MoodSummary: Safaricom is at a historic top (Thus the latest attacks on Dominance). Don't hold this stock through the bear market. But if you insist on being long then prepare to be under water for at least one half and two years (or more ). Quote from Pioneering Studies in Socionomics pgs 158 -159. Quote:
Direction of Causality
.....
The social mood shift that occurs at the transition from bull market to bear includes a change in general attitudes toward the financial success of others. Society moves from a feeling of support toward one of resentment.
During a bull market, the social mood is directed toward rewarding achievement; during a bear market, it is directed toward punishing it. The bear market mood begins to creep into collective thinking late in a bull market. Democratic governments are instruments of egalitarianism. At some point, their representatives cannot stand watching some companies succeed wildly more than most others. When the bull market reaches exhaustion, the old supportive mood begins to crumble, and the new punitive mood bursts forth. One result of this metamorphosis in social character is governmental attacks against highly successful enterprises. In fact, they typically start with a major attack against the most successful enterprise of the time.
Safaricom Named 'Best Managed Company' In KenyaCA moves to Hire Market Dominance ConsultantAirtel Threatens Kenya Exit Over Safaricom 'Dominance'Wangusi Backs Off Bid To Check Safaricom DominanceSafaricom Dominance Splits Uhuru's Ministers You missed this one. In any case, shouldn't people buy blue chip companies in a bear? I believe the right time to buy is coming, but it is not now. Now is the time to fear (like your signature says.) Conventional thinkers waste time building shelters when they are unnecessary and then have no shelters when they need them the most. Socionomists do the opposite.
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Caution bulls. The next market raid will be swift! $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Veteran Joined: 3/26/2012 Posts: 985 Location: Dar es salaam,Tanzania
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hisah wrote:Caution bulls. The next market raid will be swift! He he..Av seen it! This one was too obvious..People chose to ignore Watching the trend-setters # Safaricom and KCB
“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.”
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Metasploit wrote:hisah wrote:Caution bulls. The next market raid will be swift! He he..Av seen it! This one was too obvious..People chose to ignore Watching the trend-setters # Safaricom and KCB NSE20 closed at 4109. The retest of 4080 support is nigh. FTSE NSE15 and 25 weekly charts show weakness, which hints the retest of the Aug 27 low will fail!
Brace for the next slide... $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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hisah wrote:Metasploit wrote:hisah wrote:Caution bulls. The next market raid will be swift! He he..Av seen it! This one was too obvious..People chose to ignore Watching the trend-setters # Safaricom and KCB NSE20 closed at 4109. The retest of 4080 support is nigh. FTSE NSE15 and 25 weekly charts show weakness, which hints the retest of the Aug 27 low will fail!
Brace for the next slide... That bounce from 4080 to 4200 fooled many and it lasted, today the pain has already started... Is that ScanGroup at 27.50. Is that arm at 42. These have been the most over valued stocks for a long time and investors wondered why. Now Half the price before the bear and more to price decline to follow These 2 should be in the golden Handcuffs saga as well. The investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: User Joined: 1/20/2014 Posts: 3,528
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BAT, Jubilee & Limuru Tea has been holding on well, will they stay strong! Time will tell! Formal education will make you a living. Self-education will make you a fortune - Jim Rohn.
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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Othelo wrote:BAT, Jubilee & Limuru Tea has been holding on well, will they stay strong! Time will tell! No!! They won't go down without a fight, but they will obey gravity eventually The investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: Veteran Joined: 9/18/2014 Posts: 1,127
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GDP grew by 5.5% in Q2 2015 which was similar to Q3 2014. If it posts a lower figure in Q3 2015(I expect it to be circa 4.8%)then it would imply we are in the early stages of a recession. Poorer Q4 2015 vs Q3 2015 metrics will all but confirm it. Add an inverted yield curve and things do not look pretty for both the economy and stocks. The main purpose of the stock market is to make fools of as many people as possible.
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Rank: Elder Joined: 9/20/2015 Posts: 2,811 Location: Mombasa
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As long as the metrics are trending Southward the stocks will keep shedding off value eroding investors wealth in NSE bourse. Credit crunch is knocking on most lucrative counters forcing short term investors to sit on cash or venture into T Bonds and Bills. ....this last quarter is MOST dangerous.....alternative sectors- specially money market is a better hedge against unpredictable returns in capital segment....As from tomorrow expecting Safcom to tank heavily to below kes 12 and financials KCB and EQUITY will swing dramatically beneath kes 40...Coop Bank has no exception likely to oscilirate towards kes Kes 16 .....Once they hit there...psychological lows will broken and NSE 20 share index gonna be on a free fall accelerating to below 3500 points abyss. Panic will spread following profit warnings coming soon thereby triggering rapid downward movement with immediate exponential upsurge in prices....but the drastic rise in NSE 20 share index will be shortlived.....Sit back and watch economic Tsunami is coming. John 5:17 But Jesus replied, “My Father is always working, and so am I.”
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Rank: Member Joined: 12/1/2007 Posts: 539 Location: Nakuru
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Spikes wrote:As long as the metrics are trending Southward the stocks will keep shedding off value eroding investors wealth in NSE bourse. Credit crunch is knocking on most lucrative counters forcing short term investors to sit on cash or venture into T Bonds and Bills. ....this last quarter is MOST dangerous.....alternative sectors- specially money market is a better hedge against unpredictable returns in capital segment....As from tomorrow expecting Safcom to tank heavily to below kes 12 and financials KCB and EQUITY will swing dramatically beneath kes 40...Coop Bank has no exception likely to oscilirate towards kes Kes 16 .....Once they hit there...psychological lows will broken and NSE 20 share index gonna be on a free fall accelerating to below 3500 points abyss. Panic will spread following profit warnings coming soon thereby triggering rapid downward movement with immediate exponential upsurge in prices....but the drastic rise in NSE 20 share index will be shortlived.....Sit back and watch economic Tsunami is coming. What exactly is happening tommorow to explain what you are predicting? For investors as a whole, returns decrease as motion increases ~ WB
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