Daily Alert – Friday 6th November 2020: The Decline of the West

Mark NugentDaily Alert, Nov 2020

Daily Alert – Friday 6th November 2020: The Decline of the West

I do not know where to begin with this weekly review. The US election remains undecided, although Biden still looks the likeliest winner once all the votes are counted, including the fraudulent votes (if there are any). Trump and his slavering sidekick Rudy Giuliani make all sorts of inflammatory comments about Democrat fraud and launch several court cases. There are six states still to declare and Trump needs them all to win. Not likely.

Even if the Democrats win, they will do so by a hair. This, after, as they would characterise it, 4 years of fascism, sexism, racism, blah, blah, blah….What does that say about what the electorate think of the Democrats? I think I heard one Dem point this out when I was half asleep at 6am on Wednesday morning…but it may have been a fever dream. Hard to tell the difference these days.

Over in Europe we have lockdowns in Germany, France, Spain, and the UK. In the UK the furlough scheme has been extended to end March. That is 13 months folks. On the taxpayer’s dime. I am not saying it is wrong, but it cannot all be right. Not so spiffy for the self-employed, the bulk of whom have been offered…the dole.

A thought keeps popping into my head unbidden (unBiden?!) – “when are the adults going to show up?” It is like Lord of the Flies in the West right now. Global. Laughing. Stock. As the kids might punctuate it.

Market sentiment has been either indecisive or risk on, but the components of the calculation have been at odds and although the calculation always provides an output, the clashing elements indicate caution is required.

Global stock indices are up. The S&P500 is close to the all-time high on the weekly chart. As is the Nasdaq with the Dow not far behind. The Japan225 is currently at a new all-time high on the weekly chart. GOLD bursts through resistance and even oil rises. On currencies, the JPY and USD are up and the commodity currencies are down, reflecting the risk sentiment quite nicely, although with a fair bit of choppiness. The GBP and EUR both rise as everyone on the planet cannot believe that the pan-Western clown show will be taken to a new level with a no-deal exit.

Somehow, amid all the chaos, I traded S&P500 and AUDJPY, both long, at the Monday close, exiting in the early hours of Wednesday, for a total gain of 6.4% on a total risk of 2%. Year-to-date I have tripled my money. This is unprecedented and I am shocked. Members can find brief videos of these trades in the members area under the “Trades” tab.

Trade of the week was long any US equity index, entered on Monday night and exited tonight before the close, but if you rode that dragon you are mental. I was cautious and got 6.4%. That is enough.

It must be time for a drink. For me it was, about an hour ago.

Have a great weekend and I’ll be back on Monday.

You can watch the video in the VIP Club members area HERE