Written by: Mike Simonato, Ontario Presenter: “Investing for the Long Term, presented to the Feb. 6 2021 International Online Forum, you can watch by CLICKING HERE.
Well, to say this was a crazy week is an understatement. Let’s start with the Virus, shall we?
- In Ontario, we set new records almost every day. The hospitals are full, The Doctors and Nurses are beyond stressed. Premier Doug Ford asked for 1,000 Doctors and Nurses from across Canada to come and help us. Trudeau offered to send in the Red Cross to help. Ford said no. This 3rd wave is sending more people, at a younger age and a lot sicker than before thus overwhelming the hospital system. All non-emergency surgeries have been postponed once again. I have a client this Monday who has had her cancer surgery cancelled once again. I guess Cancer is no biggie.
- I actually am classed as living in Grey Bruce Region. We were in the news for having by far the fewest cases. Now we made the news for soaring cases. I won’t get into why the change I’ll just summarize by saying, it’s because of incredibly Stupid and Selfish People. This is a week in the life of Ontario/ Grey Bruce.
We started the week in another lockdown but not too bad as long as we don’t mind walking around with Long White Hair and Spare Tires as all Gyms and Hair Salons are closed once again. Mind you, they limit us to Curbside and Delivery only at restaurants so that may help with the weight gain. Now because the incredibly stupid won’t co-operate with authorities Thurs and Fri we had a 48 hour stay-at-home order. We were all to be considered infected until told otherwise. (of course this was ignored but we made the news again so all good) Then Friday the announcement that the stay at home order is extended for all Ontario until May 20th and things like Parks, Playgrounds, Golf Courses, Construction etc were to be all closed until May 20.
Essential Businesses are now down to 25% capacity.
Now for things that affect the market. I don’t pretend to understand how inflation works, but when: Lumber Prices Triple, House prices rise 31%, Gas is up 50% from what I paid last year, Groceries are more expensive for sure, yet inflation is still at an acceptable level.
Crypto Currencies continue to make no sense. Dogecoin, a Crypto Currency which started as a joke, was up 400% this week.
The Chip Shortage is about to get worse. Taiwan is the center of the Semiconductor Manufacturing and it’s facing a drought.
New Investors are discovering the pitfalls of dealing with Robinhood and other trading apps now that it’s tax time.
Canadian asset managers launch ETFs solely dedicated to cryptocurrency.
Big 3 Telcos in Canada have to open up their networks to the smaller players, so our Cell Phone bills will be going up
In a push to revive tourism, if you want to vacation in the Maldives, you can be vaccinated upon arrival.
Now back to scary: Brazil is fighting their Covid situation with the Chinese Vaccine which even the Chinese say isn’t that Good
As I mentioned last week, these next 3 months are crucial not only for the economy but our quality of life.
This week, Earnings season gets underway in earnest. For me, My Main Focus will be Guidance. Earnings will be explosive for those who will survive but guidance should deal with Supply Chain issues, Ability to get good workers, How will Biden’s tax plan affect big business etc etc Should be an interesting 3 months.
Now for the Markets:
DOW JONES: Textbook uptrend Volume pretty much at 50 day moving average. RT Rising nicely.
NASDAQ: Broke out of wedge 2 weeks ago Now must break above 14,141.51 (Resistance) Rt also rising nicely but on lower volume
S&P 500: Same as Dow Beautiful uptrend
MKT TIMING: Price just barely broke above resistance on Friday Need confirmation next week Bearish Divergence so caution is warranted
READ Views and Strategy
PTSE: Beautiful uptrend Volume a little light but no worries. RT Rising but at key level
VENTURE: In a Wedge Volume has been light until nice Buy days Thurs and Friday Rt still weak
MKT TIMING: Price in a nice uptrend but there has been a Bearish Divergence for a while now so again be cautious
EUROPE: Strategy urging caution
BRITAIN: READ VIEWS and Strategy Bullish
AUSTRALIA Strategy again Bullish