Weekly Dive for April 14, 2024

Thinkers are Money Makers

$SPY, $BTC, $COST, $GOLD, $USDJPY, $USDMXN, $FXI, $EWZ, $CORN

SPY

ETF, comprising 500 stocks, serves as an indicator of the overall stock market performance.

The SPY, serving as a proxy for the stock market, has recently broken its upward trend. The critical question now is how much it will drop before rebounding. Historically, markets have generally risen leading up to elections, so we must patiently wait and see what the next move will be. However, as of right now, it's evident that we are no longer in an uptrend unless it reaches new highs.

As a contrarian, the sight of dancing bears makes me think that the opposite of what's expected might actually happen.

For those who are not accustomed to major market downturns, a Margin Call is when your bank notifies you that your account balance has turned negative. You are then obligated to either sell some assets or add more funds; if you do not, the bank will liquidate your holdings for you.

Bitcoin

It's been a bumpy week heading into the halving, but I've observed that most significant pullbacks in Bitcoin are due to traders using margin. These individuals borrow money to buy or short Bitcoin and often get liquidated by market makers. It's unfortunate, but it's part of the game when you opt to borrow money. We've been anticipating a 3 or 5 Wave pullback in Bitcoin, so this should not come as a surprise to Hedge Shark readers.

Stocks tend to experience a 3-wave pullback, and we believe that we are close to reaching the bottom of the first part of this cycle. (Shown in white)

At Shark Hedge, we advocate that one of the fundamental principles of our strategy, regardless of the asset, is to practice Dollar Cost Averaging (DCA). This means gradually buying small amounts over time.

In other words, we nibble, bit by bit, until we have a full position.

Wells Fargo estimates, Costco selling as much as $200 million in gold bars monthly.

Gold has turned into money for Costco, where yellow metal sales begun last year have turned into a cash cow for the big-box retailer. In fact, sales are so brisk that analysts at Wells Fargo expect revenue “may now be running at” $100 million to $200 million a month, a rapid acceleration since bullion hit the warehouse club late in the summer of 2023.

“Our work suggests there has been significant interest given COST’s aggressive pricing and high level of customer trust,” Edward Kelly, an equity analyst at the bank, said in a note to clients Tuesday. “The accelerating frequency of Reddit posts, quick on-line sell-outs of product, and COST’s robust monthly eComm sales suggests a sharp uptick in momentum since the launch.”

GOLD is going up, and yes it is too late to get in…

US Dollar making new highs on Japanese Yen

US Dollar weakening against the Mexican Peso

FXI

The Chinese stock market is currently positioned at a robust support level, indicating a potential rebound in its performance. Market indicators suggest that investor sentiment is turning positive, with renewed interest in Chinese equities. This resurgence may be attributed to various factors, such as improving economic data, policy adjustments, and global market trends. As a result, investors are cautiously optimistic about the market's trajectory in the near term. However, it's essential to monitor developments closely to assess the sustainability of this rebound and any potential risks that may arise.

EWZ

The Brazil ETF is showing signs of breaking out of a prolonged downtrend, suggesting a potential shift in market sentiment and a possible upward movement in the near future.

CORN set to POP!

Corn appears primed to experience a significant upward movement from its current support level. Market analysis indicates that several factors, including supply-demand dynamics and weather conditions, could contribute to a potential surge in corn prices. Furthermore, recent developments in global agricultural markets suggest increased demand for corn-based products, which may further bolster its price trajectory in the coming weeks.

Although we see the upside of these stocks, it is essential for readers to recognize that investing always carries inherent risks. Therefore, we strongly advise conducting comprehensive market research before committing any capital. Understanding the nuances of the market landscape and considering factors such as financial goals, risk tolerance, and time horizon are paramount in making prudent investment decisions. Consulting with financial professionals or utilizing reputable resources can provide valuable insights and guidance to help navigate the complexities of the investment world effectively.

Thanks and have a good week!

The SharkHedge Team