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MongiIG

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  1. Look ahead to the week starting 18 October: Earnings & China data The week starts with Chinese data. IG’s technical analyst Joshua Mahony looks at USD/CNH. Then on to EUR/GBP for data in the UK and across the EU. Corp data on US techs including Netflix and Tesla, also UK banks with Barclays. https://www.ig.com/uk/market-insight-articles/look-ahead-to-the-week-starting-18-october--earnings---china-dat-211015
  2. Netflix Q3 after a successful year at the Emmys Investment in new programming has been the foundation for recent earnings at the streaming giant Netflix. As IGTV’s Jeremy Naylor says it won a number of Emmys, but does this translate into subscriptions? https://www.ig.com/uk/market-insight-articles/netflix-q3-after-a-successful-year-at-the-emmys-211015
  3. KEY TALKING POINTS: Global stocks rally as US earnings push back stagflation concerns. Investors must be aware of inflation effects in different sectors. Global stocks have rallied significantly in the last two sessions as upbeat sentiment returns to markets. Continued growth in earnings from major US banks and asset managers have seen investors take a break from concerns about growth and stagflation, focusing also on improving jobs data and a small decrease in the rate of growth of PPI. But traders must remember that we are only into the first few days of the Q3 reporting cycle and financial companies are likely the least affected by the rapid growth in consumer and energy prices. Therefore trading is likely to continue to be choppy over the coming days as we get more insight into how profit margins have held up in different sectors, all whilst energy prices continue to reach new highs. Ongoing concerns about faltering demand and supply constraints could bring on another pullback in the short term, but for now markets seem to be very much risk-on. The S&P 500, which is a good indicator of overall market sentiment, is up almost 3% since Tuesday, lingering around the 4,450 mark. The pullback since the beginning of September has been just what markets needed to attempt a new leg higher, with the RSI now showing further short-term bullish momentum building towards 4,500. S&P 500 Daily Chart European stocks are also seeing dip-buying into earnings season, with the DAX 40 managing to break above its descending trendline resistance and the FTSE 100 at 20-month highs. The German index is also above its 200-day moving average which is likely to offer support at 15,085, whilst the 100-day and 50-day averages are converging around 15,598 and could become an area of resistance to overcome. The important test is going to be whether the DAX can hold above 15,400 over the coming days, which would set the index in a good position to reach the 15,600 mark. DAX 40 Daily Chart The FTSE 100 is finally attempting to break out of its 6-month range between 6,890 and 7,200. The push higher this week has built bullish momentum going into the second half of the month but the stochastic oscillator is starting to near the 80 mark once again on the weekly chart, meaning that a break higher could be in jeopardy if momentum stagnates once again. I’d be aiming for a break above 7,365 to consider the move away from the 6-month range complete without risks of falling back in. FTSE 100 Weekly Chart Learn more about the stock market basics here or download our free trading guides. Written by Daniela Sabin Hathorn, Market Analyst, 15th October 2021. DailyFX
  4. Confirmation bias How can 'confirmation bias' affect traders? Confirmation bias is the tendency for traders to search for, and put greater weight behind, information that confirms their pre-existing beliefs or predictions. This could mean that a trader disregards negative news about an asset because they believe that the good outweighs the bad – even though this may not be the case. Confirmation bias is linked to overconfidence, which can lead to poor decision-making and overtrading. A study by Park, Bin Gu, Kumar and Raghunathan found that traders with stronger confirmation bias are likely to exhibit greater levels of overconfidence and trade more frequently. This can lead to them obtaining lower profits because they might lose more often. IG's survey revealed that 29% of traders and investors go with their gut when making decisions – a sure sign of overconfidence. How can traders prevent confirmation bias? Confirmation bias can be prevented by carrying out your own analysis – whether this is technical or fundamental – and trusting that it is correct, even if it clashes with earlier predictions or preconceptions. Technical and fundamental analysis can be a great way for you to identify whether you should be buying or selling a particular asset – for example, overvalued stocks or undervalued stock. Analysis can confirm the true value of an asset in a more accurate and definitive way when compared to say, preconceived biases or gut feelings. It could even benefit you to actively seek out information that clashes with your preconceptions because this could counteract your confirmation bias – forcing you to think about each trade in terms of its own merits. Things to keep in mind...
  5. Risk event for the week starting 18 October: trading the EUR/GBP range With consumer price inflation data next week in the UK Justin McQueen, from Daily FX, looks at how to trade EUR/GBP. https://www.ig.com/uk/market-insight-articles/risk-event-for-the-week-starting-18-october--trading-the-eur-gbp-211015 risk
  6. Hi @Dilusha Thanks for reaching out. Please kindly visit this link on how to buy, trade, invest in IPO stocks (Pre + Post IPO): https://www.ig.com/uk/shares/ipos/how-to-trade-ipo All the best - MongiIG
  7. Hi @Robhalo Thanks for reaching out and apologies for what you are experiencing. The IG website and system status page says the current state for our main trading platforms and systems are operational. If you need further help please contact our Trading Services team via email, helpdesk.uk@ig.com I have escalated this to our incident team and technical trading support guys to review this as soon as possible. All the best - MongiIG
  8. BITCOIN (BTC/USD) PRICES, CHARTS, AND ANALYSIS: Bitcoin (BTC/USD) is back at multi-month highs on ETF chatter. A new all-time high is on the cards. The past few weeks we have regularly mentioned that the SEC is likely to look kindly upon the few Bitcoin futures-based ETFs applications in its pending tray, especially after SEC chair Gary Gensler’s positive commentary over the last two months. At a conference a few weeks ago, Mr. Gensler noted that the 1940 law provides significant investor protection for both mutual funds and ETFs. Bitcoin monthly futures are traded on the CME and are cash-settled. Turnover and open interest in Bitcoin futures have jumped sharply in the past few weeks ahead of the expected ETF announcement. Many see the creation of Bitcoin ETFs as the next step in the evolution of the cryptocurrency market into a mainstream asset class. While all eyes are currently on Bitcoin, the second-largest cryptocurrency by market cap, Ethereum, also has a futures contract with the CME and is likely to be the next cab off the ETF rank if a Bitcoin ETF launches successfully. Bitcoin (BTC) Grinding Back to Multi-Month Highs, Volt ETF Offers Crypto Diversification Bitcoin has been rallying steadily over the last few weeks after trading $40k in late September. The rally, fueled by ETF talk and an overall positive backdrop, has hardly taken a step back, leaving buyers chasing pieces higher. The chart below shows the recent upward trend that has held BTC for the last 10 days breaking to the upside and in the process taking out the double-top seen in May at $59,581. If one or more futures-based Bitcoin ETFs are granted by the SEC, the all-time high made in April this year will come under pressure and will likely be broken quickly. As always with the cryptocurrency market, care needs to be taken as the asset class has a history of throwing up sharp, unexpected moves. With the potential for a Bitcoin ETF being permissioned this year already baked in the market over the last couple of months, traders should be wary of the potential for a quick bout of profit-taking by some of the more active accounts. BITCOIN (BTC/USD) DAILY PRICE CHART - OCTOBER 15, 2021 What is your view on Bitcoin (BTC) – bullish or bearish? By Nick Cawley, Strategist, 15th October 2021. DailyFX
  9. Early Morning Call: Risk back on as indices rise FSE100 climbs to 22month highs as a hot Wall Street boosts global markets. https://www.ig.com/uk/market-insight-articles/early-morning-call--risk-back-on-as-indices-rise-211015 This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.
  10. Facebook’s share price has fallen close to 14% over the past one month. Can its upcoming Q3 earnings reverse the bearish sentiments? Source: Bloomberg Yeap Jun Rong | Market Strategist, Singapore | Publication date: Friday 15 October 2021 When does Facebook report earnings? Facebook is set to release its Q3 financial results on 25 October, after the market closes. At the time of writing, expectations are pointing to a 32.1% increase in earnings per share to US$3.17, up from US$2.40 a year ago. Facebook earnings – What to expect For the upcoming earnings release, the impact of Apple's anti-tracking initiative on Facebook’s businesses will be closely assessed, as the management has previously cautioned of a larger impact of the iOS updates in Q3, compared to the previous quarter. To recall, Apple has previously implemented new privacy controls, which limit digital advertisers from tracking iPhone users for advertising purposes without their consent. While the dropout rate to allow data collection remains to be seen, the upcoming Q3 results may provide some clarity on the impact of Facebook ad effectiveness and switching from advertisers. Some resilience in the figures for average price per ad and number of ads delivered may aid to ease some concerns in that regard. The upcoming earnings into 2H 2021 may also reveal a lower base effect compared to a year ago, where Facebook saw a huge boost in sales in 3Q and 4Q 2020 from a strong recovery in business advertising spends. Sales and earnings growth may continue to normalise in the quarters ahead and the management’s outlook will be looked upon for guidance. Source: Facebook Facebook has also been weighed by recent negative news flow, coming from a whistle-blower on the harmful effects of Instagram for young users. The management may need to address these concerns and while debates around the issue may drag on towards year-end, subsequent platform and businesses’ processes adjustments by Facebook may ease such concerns in time to come. This may be reflected in previous instances of data breaches, where markets look past these near-term ‘noises’ and daily active users for Facebook’s ‘family’ of products continue to grow. A risk for Facebook share price, however, may be movement in the US 10-year Treasury yield. With 10-year yield having broken out of its period of consolidation since late September, further upside may be a likely scenario, which could keep valuation multiples of high-growth companies in check. Facebook shares – technical analysis Ever since its 50-day moving average (MA) failed to hold up prices back in mid-September, Facebook’s share price has been trading within a near-term descending channel. That said, while prices continue to trend downwards, the relative strength index did not reflect a lower low lately, suggesting that downward momentum may potentially see some easing. A retest of the 200-day MA was met with a bullish hammer candlestick, which will remain a key support MA line to watch. That may potentially lift prices to retest the near-term resistance at US$337.00, where the level has held down prices on previous three occasions. Source: IG Charts
  11. For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK. Today’s coverage: Volatility crashes rising support indicating further risk attitude Indices: Hot start to the earning season in the US saw Wall St climb, Europe expected up at the start UKX 22mth high. Good day in Asia Equities: Can GS emulate peers and post impressive numbers today? AA last night rose after earnings. RIO Q3 cuts forecast FX: Watching USD with US retail sales data at 1:30pmUK. EURGBP approaches key support we’ll be talking to Justin McQueen from DFX Commods: Gold back up over the 200-day SMA. Copper over 10,000 with other base metals gaining aluminium zinc nickel etc. Oil continues its rise. Lumber up again https://community.ig.com/igtv/
  12. Investors are hoping to see a recovery in net paid subscriptions from Netflix’s UCAN region in the upcoming Q3 results, while also hoping to learn more about the group’s investment into online gaming. Source: Bloomberg Shaun Murison | Senior Market Analyst, Johannesburg | Publication date: Thursday 14 October 2021. IG Netflix Q3 Earnings Preview When is Netflix's earnings date? Netflix Inc., the Nasdaq-listed, world-leading internet television network, will report its third quarter (Q3) earnings for 2021 on Tuesday the 19th of October 2021. Netflix results Q3 2021 earnings preview - what does ‘The Street’ expect? Netflix has suggested that in the third quarter, we can expect net paid additions to its subscriber base of 3.5 million, with an average revenue per member increase of 5%. Revenue of $7.48 billion and earnings per share (EPS) of $2.55 have been forecast by the company. A consensus of estimates from Refinitiv arrives at the following expectations for the Q3 2021 Netflix results: Revenue $7.48bn (+16.2% y/y) Net income on an adjusted basis $1.158bn (+46.63% y/y) Operating profit $1.156bn Earnings Before Tax Depreciation and Amortization (EBITDA) 1.705bn (+17% y/y) EPS of $2.56 Second quarter results highlighted a relatively soft period for the United States and Canada (UCAN) region, with a contraction of 400 000 in terms of paid memberships. While the second quarter has shown some cyclicality towards weaker subscriber numbers (from UCAN), the market will want to see a return to growth from this (the group's) largest membership base. Market participants will also hope to hear more detail around Netflix’s recent decision to diversify into the online gaming world. The group has recently announced the acquisition of its first gaming studio ‘Night School Studio’, and has been developing and testing games on the Android operating system. However, little is known about the group's strategy pertaining to gaming at present. How to trade the Netflix results A Refinitiv poll of 45 analysts maintains a long-term average rating of buy for Netflix (as of the 14th of October 2021), with 13 of these analysts recommending a strong buy, 20 recommending a buy, eight hold, three sell, and one with a strong sell recommendation on the stock. Source: Refinitiv Workspace Seventy-four percent of IG clients with open positions on Netflix (as of the 14th of October 2021) expect the share price to rise in the near term, while 26 percent of IG clients with open positions on the company expect the price to fall. Source: IG Netflix results: technical analysis Source: ProRealTime The long-term trend for the share price of Netflix remains firmly up. In the short-term the share price is trading in overbought territory. Traders respecting the long-term uptrend might hope for a short-term correction from overbought territory, for long entry. The 603.50 and 558.50 levels could possibly provide these points of accumulation should a correction take place. Channel resistance at 744.50 provides a longer term upside target. Only on a break below channel support would we reassess our long bias to trades currently favoured for Netflix. In summary: Netflix will report its third quarter earnings for 2021 on Tuesday the 19th of October 2021 Revenue of $7.48bn (+16.2% y/y) is expected for the reporting period EPS of $2.56 is expected for the reporting period An addition of 3.5m net paid subscribers are expected in the third quarter The average broker rating for Netflix is ‘Buy’ The majority of IG clients with open positions on Netflix expect the price to rise in the near-term The long-term price trend for Netflix is up, and the share is overbought in the near-term.
  13. Loss aversion bias How does 'loss aversion bias' affect traders? Loss aversion bias is a preference for avoiding losses over acquiring the equivalent gains. It implies that the fear of a loss is greater than the pleasure of a gain. Research by Odean looked at 10,000 trading accounts held between 1987 to 1993, and found that individuals have a tendency to hold on to losing positions for a much longer period of time than winning trades, out of a fear of realising a loss. Percentage of trades closed at a gain and loss IG data backs this up, showing that although traders close over 50% of trades at a gain, they lose significantly more on their losing trades than they make on their winning ones. This emphasises that instead of accepting a small loss, many traders will hold on to their positions and risk eroding their profits. How can traders prevent loss aversion bias? A key step in preventing loss aversion bias is acknowledging that it exists. When you start to create a trading plan, it is important to consider how much you are willing to lose as well as how much you want to gain. And once you have established your trading plan, it is important that you have the discipline to stick to it to avoid taking unnecessary losses. One way of doing this is by setting a suitable risk-to-reward ratio, which compares your capital at risk to the amount you stand to gain. For example, if you set a ratio of 1:3, then you'd only need to profit on three out of ten trades to have an overall profit. The correct risk-to-reward ratio could ensure that your gains are always at least as large as any potential losses, giving you the confidence to overcome loss aversion bias. Things to keep in mind...
  14. FTSE 100 TECHNICAL HIGHLIGHTS: The FTSE is working towards a breakout, but… Can’t jump the gun as we need to see confirmation. Multi-month consolidation could lead to 2020 highs and better. The FTSE 100 is working on breaking out of the multi-month range it has been building since around May. If we see a close above 7220 the market may indeed string together a run that takes it back towards the pre-pandemic highs and possibly better. But before getting too bulled up we want to see at least a daily close in breakout territory, and given the duration of the consolidation pattern a weekly close would be even better. We may get it this week if buying pressure continues to persist through end-of-day tomorrow. Upon confirmation of a breakout, the next point of resistance to watch is a trend-line running lower from the 2018 high, this currently lies near 7400. Beyond that point the 2020 highs at just shy of 7700 could come into focus. But as it happened the last time we discussed the FTSE, a rejection could soon occur, and while this in of itself won’t turn the outlook bearish it will keep things neutral. In this scenario, if later the FTSE is to undergo a bullish breakout it would be preferable that weakness be muted and price stay near the high end of the range. Increased pressure prior to a breakout increases the likelihood that it won't result in a false breakout. For the outlook at this time to turn decisively bearish we will need to see a hard turn down in momentum that takes out the 200-day moving average along with the bottom of the range at 6813. Barring any major shocks this is unlikely to happen any time soon. FTSE DAILY CHART FTSE Chart by TradingView Resources for Forex Traders Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex. Written by Paul Robinson, Market Analyst, 14th October 2021. DailyFX
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