Going downhill is faster than climbing uphill

2020年1月29日

From a running point of view, it makes sense that running uphill is slower and harder compared to running downhill, once the momentum is set, it gets faster and faster.

Now , if the WHO declares that China is in a state of global public health emergency as evidenced in this article , then the selldown will be hard and furious. Not only that, other regional stock markets will be pulled along as well.

This can last for a few months , just like SARS before we see enough bloodshed in the streets. While one may be tempted to go in the market and pick up good and cheaper stocks, one must not forget in an event like this, daily updates like number of deaths, how many countries are not infected, etc are sending chills to investors and they will scramble faster than their logical mind can tell them. Panic selling will set in and safe haven assets like gold and yen will be rising higher.

Now , it has found some temporary support but I reckon the breakdown is inevitable.

2020年1月30日

注释

scmp.com/news/china/society/article/3048136/china-faces-bigger-epidemic-sars-complicated-and-grave

It is down 2.5% at time of writing. It is this fear of no known cure for this virus and how severe it will get that made investors and traders panic. One sell and the rest follow one can see the global indices are not spared as well. While my long term view on China is still bullish, knowing how to short sell is one way of hedging as well. Of course, others may like to buy bonds, yen or gold for that matter. Do what you are comfortable with and always use a SL , trade with appropriate risk and capital.

2020年2月2日

注释

reuters.com/article/us-china-health-exchange-results/shanghai-stock-exchange-extends-deadline-for-companies-release-of-2019-financial-reports-idUSKBN1ZW03B

2020年2月2日

注释

reuters.com/article/us-china-health-cenbank/china-to-inject-174-billion-of-liquidity-on-monday-as-markets-reopen-idUSKBN1ZW074

Please note that while China government is helping to shore up the equity market, it will take time for absorption and reflect into it. Today marks the first day after the week long halt of the stock market and the coronavirus together with the newly discovered bird flu will create even more fear and panic amongst traders and thus I believe another sell down will occur.

2020年2月5日

注释

This move up , imo should be a dead cat bounce after fallen so hard and so fast. Also, without the government injecting trillions of yuan into the market and asking the big boys to limit short selling, I believe it will be worst. I am awaiting for another opportunity to sell down

2020年2月23日

注释

Obviously, we were so wrong, haha. The market proves to act according to the injection and rebounded a V shaped recovery so strongly that if one does not have a profit target , he has to pay the price for being greedy as he watches his profits evaporated and if nothing is done, he will incur a loss.