Waiting for Gains in China

Published on
August 9th, 2018
Topic
Trading, China, Technical Analysis
Duration
8 minutes
Asset class
Equities

Waiting for Gains in China

Technical Trader ·
Featuring Dave Floyd

Published on: August 9th, 2018 • Duration: 8 minutes • Asset Class: Equities • Topic: Trading, China, Technical Analysis

Technical analyst Dave Floyd, founder and president of Aspen Trading Group, is bullish on Chinese stocks. In this video, he reads the charts and breaks down his ETF trade. Filmed on August 7, 2018 in Bend, Oregon.

Comments

  • DF
    Dave F. | Contributor
    24 August 2018 @ 16:20
    Stronger Chinese yuan coming into play over the last few days. In the video I suggested shorting USD/CNH into the 6.90-7.00 area.....prices did, in fact, stall into that range and are now impulsively lower at 6.8000. Shanghai Composite also moved lower to 2700'isg (as noted).....rally from here? Still not clear, but many momentum divergences into the lows.
  • DF
    Dave F. | Contributor
    23 August 2018 @ 03:07
    FYI...for those keeping track.....long recommendation from a couple months back, LOW, a nice +6% pop higher....maintain long.
    • CY
      CHIHLUN Y.
      6 September 2018 @ 09:19
      Keeping track indeed, thanks for the updates!
  • DR
    David R.
    15 August 2018 @ 14:11
    Always interesting, thank you.
  • KH
    Kurt H.
    14 August 2018 @ 22:02
    Dave, I just wanted to thank you for your work on RV and the tradee ideas you are posting. Coupling these with my own research and observations I have been very happy with my results on DBX and AAOI. I am still researching this one on China which is tricky. I take these videos for what they are, ideas, and if there is something I don’t agree with or don’t understand, I don’t trade on it or set it and forget it. Keep up the great work and keep ‘em coming. Thank you.
    • DF
      Dave F. | Contributor
      23 August 2018 @ 03:07
      You are welcome Kurt.
  • MU
    Mo U.
    13 August 2018 @ 02:04
    Dave, you mentioned that "my facts are so far off it ain't even funny". Let's see: IWM; your 3 month target price was 193. We are close to the 3 month timeline, and the current price is 167. DBX: you are correct, the puts haven't expired yet, but looking at the current price I can tell you that they are under water. IJH: I never mentioned that ticker, so I can't comment. AAOI: in your June recommendation you stated a "near term realistic target of 58" and "we'll add more positions as prices begin to move higher". That is quite in contradiction with your statement below that "prices were around $42.50....went to $50 then turned lower....any trader with an ounce of common sense would have booked profits and not allowed a winner to turn into a loser". Regarding your current recommendation, long Chinese stocks, it seems a risky bet in my opinion based on all wha't going on in the EM space (increasing tariffs to China, collapse of the Turkish lira, economic sanctions to Russia, etc). I can see some value as a contrarian bet, but not something I would recommend to non-professional investors, which I believe represent a big percentage of RV subscribers. In any case, I wish you the best in that trade. At least, I believe we both share the same opinion that it would be good that RV implemented a rating system. Best, Mo
    • DF
      Dave F. | Contributor
      13 August 2018 @ 03:27
      Mo.....your response speaks volumes. Have a nice evening.
  • DF
    Dave F. | Contributor
    12 August 2018 @ 22:04
    Mo U.....I responded to your posting from Saturday. Please see below. Your comments were inaccurate and needed a well-researched retort. Enjoy the rest of your weekend.
  • MU
    Mo U.
    11 August 2018 @ 20:24
    What a joke! Dave has been wrong pretty much every single time with his recommendations (IWM, Drop Box, AAOI, etc etc) - with very few exceptions such as Conoco Philips. Since RV is targeting the mass market and not the sophisticated investor community, I think it is about time that you create some some sort of rating system that keeps track of the performance for each contributor's recommendations. That way people will be better informed about who to trust or not, and in some cases - like Dave's - whose ideas we should short (which is also very valuable!). Simple stating at the end of each episode that "this is a trade idea, and not investment advice" just doesn't do it for most of us.
    • JB
      Johan B.
      12 August 2018 @ 06:35
      Why not have an evaluation episode once every three months where someone evaluates what has happend tö the trade ideas given during the last year.
    • DF
      Dave F. | Contributor
      12 August 2018 @ 21:53
      Mo U. - with all due respect, I am not sure how you formulated 'my results'....let's review....shall we? Before you go slamming me, make sure you have your facts straight....cause you are so far off it ain't even funny.. I put a tremendous amount of time putting together my trades to share here on RV so to have you come in an trash me with ZERO evidence is really rather disingenuous And by the way....I have been advocating for a rating system since Day #1....I am comfortable sticking my neck on the line 2x a month.....try it sometime.....it ain't easy IWM: issued May 24....prices were at $161.50'ish....last $167.53 DBX: issued April 19th....longer-term trade to extend BEYOND stock lock-up....still trading around suggested entry...and I had issued a trade for October puts....last I looked it was not October yet. IJH: issued July 12th...prices were around $199....last $199 AAOI: issued June 21st....prices were around $42.50....went to $50 then turned lower....any trader with an ounce of common sense would have booked profits and not allowed a winner to turn into a loser. Sounds like you were not quite that dialed in? Pardon my rant RV subscribers, but given that the 'financial media' space is sorely needing credibility, it is imperative to tackle head on those that seek to twist the facts.
    • ML
      Michael L.
      14 August 2018 @ 01:44
      I'm sure there's things Dave could have done better in his presentation, but what you're saying is not constructive. It's one thing to point out why his reasoning is flawed, it's another to just judge him on results alone. His job is to present well argued ideas, your job is to tear them apart, evaluate and judge for yourself. If you just take his trade ideas and it doesn't work, it's really your fault.
    • DF
      Dave F. | Contributor
      29 August 2018 @ 05:29
      Michael L.....it is totally fine to judge based on results. Well told stories and fancy research don't pay the bills, but they are nice to read with a warm glass of cognac in front of a fire. The issue with Mo's comments was that has was completely wrong in terms of measuring my performance.
  • MF
    M F.
    11 August 2018 @ 17:20
    Dave...thanks for that...would you say a similar formation/favorable up/down is taking shape in the first cousin of the etf you mentioned in the form of SGX FTSE China A50 index futures (BBERG ticker XU1 Index for the generic)...its got a high correlation to the ETF and similar fundamental dynamics, although you are better placed to comment on the chart for this liquid china future that trades in Singapore. Thx in advance
  • JM
    John M.
    10 August 2018 @ 07:46
    Dave, What is/are the trigger(s) you use to express your trade when you are waiting for a trend change such as this one? Are you looking for a smaller degree five waves up, a close above the down sloping trend line or other factors such as sentiment? John
  • DI
    Dabangg I.
    10 August 2018 @ 01:59
    Given your time horizon, how would you suggest playing FXI, Buying ETF or call options? Also, when do each of these make sense in the context of time frame and swings you are looking at?
    • DI
      Dabangg I.
      10 August 2018 @ 01:59
      Thanks in advance! :)
  • JS
    Jon S.
    9 August 2018 @ 21:16
    Dave,...seperate topic. How did we miss on NGD?
    • DF
      Dave F. | Contributor
      9 August 2018 @ 22:40
      NGD has been added to George Carlin's list of bad words! What a disappointment....the whole PM sector for that matter. One thing I did learn from that was that when I get spread too thin....I am not at my best. A handful of FX pairs and major assets like the S&P's and 10-year notes works just fine....and an occasional valuation play. The argument for gold and PM's makes sense....but it simply never or has not developed.
  • SH
    Steve H.
    9 August 2018 @ 21:00
    Well-argued, as always.
    • DF
      Dave F. | Contributor
      9 August 2018 @ 22:40
      Thanks Steve H
  • JE
    James E.
    9 August 2018 @ 20:30
    Elliott Wave forever. Agree Dave on your view on Shanghai Composite Index, also I count a Wave 2 up in the USD/CNY. Increased strength in the CNY could last for years. There could be very volatile markets next year.
    • DR
      David R.
      15 August 2018 @ 14:09
      Same here except wave 3 is still a ways off yet. Then there's Martin Armstrong's newly published book and subscriber stuff that shows how the way is paved for China to be #1 (by far) in finance, economics, tech and military by 2032. It will be a uni-polar world again, one in which when the Chinese president snaps his fingers, Americans will jump and do as told, or else be exterminated. Brave new age, now all but inevitable. Starting with the coming lurch to far left socialism in US this November and 2020. Every major call of his since the 1970's has nailed it, including this US bull & dollar run (and gold bearishness) that he laid out for us at his 2011 WEC... nailed it all!
  • DF
    Dave F. | Contributor
    9 August 2018 @ 13:25
    GM Sin.....isn't it funny how similar conclusions can be drawn via a different method/approach? I will certainly call Raghee and have a chat about this forecast. Enjoy the week and the last weeks of summer.
  • JD
    John D.
    9 August 2018 @ 12:52
    Nice job Dave... Short and Sweet...
    • DF
      Dave F. | Contributor
      9 August 2018 @ 13:27
      Thanks John D.....that's my philosophy on trading/analysis. IMO, the longer it takes you to distill your thesis/forecast, its possible you may be rationalizing versus just seeing it for what it is....trade or no trade.
  • SH
    Sin H.
    9 August 2018 @ 09:36
    Interesting that this idea is pretty much the same as the one proposed by Raghee Horner on 7/3 - but approached it differently. Thanks.
    • CR
      Chris R.
      14 August 2018 @ 17:16
      Dave—First let me thank you for sharing your ideas and having the conviction to back them up in the comment section. Curious if you still like this trade with the recent events and Turkey potentially driving investors even further away from emerging markets and into the USD.