Member Info for Velo

You're welcome Mark

Well a 6% gain close to the day. Nice :)
That's May, now likely to be soon back on track then :)

Everything still holding for the March to May season to close as planned; so I hope to report as much at the month end soon. And if all on course then a disappointing June on the cards follows- which the Chinese can take the rap for
- but if May closes as expected; then no reason why June shouldn't follow on its own cyclical path.

June is the Joker in the Pack month. Don't normally bother with historical cyclicals but SLP has been remarkably predictable to date; and would like that to continue. Nothing else to do with SLP anyway as it's taking care of itself, so time for some cyclical fun and see if the full year premise remains intact.

And should June play ball, then there's no reason the stars of the year - explosive July and August shouldn't deliver and unveil their cyclical performance on cue also.

Such fun.

-------

For tomorrow Thurs, of course no one knows for sure whether there will be another attack of the bears or the SP is restored to its chosen path. Should it be the case of back on the chosen path, then I have in mind that the SP should make an attempt on 127, if possible.

If not, then the halfway house close by the SP today, wasn't enough
- And not a problem if it doesn't, as early days.

- Wasn't enough? C'mon, a 6% gain for the day is saying no such thing :)

Ended the day cutting the grass when the weather turned, so saw the SP was 123.5 by well after close on live prices.
That was a result - just a ha'penny short of the key resistance level for the day, Yay!

Finished mowing and returned, and the sell price was still at 122 as the first thing I saw, then noticed although the buy/sell margin had held, there must have been some late book balancing from after hours auction as the settled mid-price for the day had retraced down to 122.2
- well over a 1p drop at the last hurdle of the day.

Whatever, it's still enough to get the job done. Will be surprised if the SP doesn't go on to greener pastures now.

Only fear is, is this merely a pause by the Chinese authorities or - all over as only intended as a one-day warning?

Why don't they just arrest their own people whom they accuse of stockpiling instead of punishing the whole world for their own citizens alleged crimes against the state?

Then everyone can tut-tut at the terrible arrests in the TV news, instead of moaning: Get your feckin' hand out of my wallet!

I'm reminded of that scene in The Italian Job where Michael Caine is surrounded on a mountain road by heavily armed Italian mafia who are after his stolen loot.
Cool as a cucumber, Michael Caine in his best not a lot of people know that voice, says:
"There are 600 Italian restaurants in London - and they will all suffer a collapse in business if you continue".

I say similar to the Chinese authorities:
There are 10,000 Chinese takeaways in England, and if I cease my toxic diet and go all healthy-eating I can close them all down t a stroke, through lack of business - your choice - if you continue with this malarky!

There, that should do it.

Off on some other jobs shortly so won't be seeing the afternoon until after close.

Very pleasing to see the SP currently sitting on 124 mid price.
It will IMO, take some doing to hop over 124 as it's the first up intraday resistance of the day. And has appeared to stop dead on 124 on a couple of a occasions already.

So am leaning towards difficulty in getting past 124 today.

If the SP closes above 124 I'd be concerned at 'spikiness' as the gain is at 7/8% already. And can't ***** at a one day 10% foreign state manipulated pullback one day and similar amount gain the next if all was normal. The 'normal' if it does hop over 124 is the righting of a manipulated wrong. The market always has the last word, whoever you are.

However, half an afternoon to go and the SP is locking horns on 124 so should it close on the other, upside of the 124 border, then it's fair to say game over for the bears. Even closing on no further than 124 is still game over for the bears but with further confirmation required.

Closing no less than 120 although neutral would need a strong confirmation for the rest of the week before saying game over for the bears.

However, the Chinese authorities have revealed their hand, so the question is, was yesterday just a warning shot from them, or are they intent on causing further harm?

I will take my lead from the trends.

And kudo's to TigerByTheTail, who has at least twice now this year (what's the opposite of apex, is it nadir?) bought not only in the dips but bought at what is deemed near impossible to achieve on a repeatable basis - the exact floor of each dip at its precise nadir (at 103 last month and 115 this morning).

Some going for a nonchalant, shoulder-shrugging, I just buy the dips :)

This "dip" commenced in earnest after the overbought condition terminated at circa 140 (12th/13th) then sucker-punched and misled for approx a week, thereafter the SP fell like a stone continuously.

With such a feeling for the precise floor I hereby rename TigerByTheTail as a skilled highrise, mansion-tower rooftop, cat burglar who unerringly to date has succesfully burgled the SP jewels on key occasions this year.

Morning Stoodio (Stud:) if still :am,

You've heard of the Naked Trader, yeah? Well I was the In-a-Bed-Trader this morning, as posted the media link etc., about China from bed (stayed up even later last night, into the wee small hours).

So was catching up elsewhere this morning with time only to observe the first hour's action which delighted in first contact with the day's pivot point @ 120.

My ambition for today is a minimum to close no less than 120.
That's the neutrality spot. Neither bullish nor bearish - but I'll take it.

A 124 close would be v nice but if the SP closes between those two stools then it's at least erring on the side of bullishness in readiness for Thursday, and still pleasing to me. (Yes, noticed first encounter with 124 approx 9:10am this morning)

(The 27th May to 6th June might yet stick it's bullish oar in - but I'm being a bit way out left field there, in the way sell in May and the Santa Rally axioms are, so will let that hang there and move on :)

I'm controlled by my trend following strategies, so whilst I have 2 bearish trend lines who have gone rogue (at the lower end) they're putting me on notice whilst they remain infected with Covibearishness.

Those pivot points have a 24 hour life expectancy only, so are irrelevant from 4:35pm real-time tonight. They're a day trader's tool. So 20 and 24 are meaningless as intraday pivots after tonight.

It's looking upbeat currently (THS had a disastrous opening - it Gapped DOWN, but has since recovered to yesterday's close only. JLP is currently down marginally.

This behaviour by SLP today, in the aftermath is more like the response a quality but undervalued balance sheet stock's strength I would have expected to see yesterday; instead it reacted the worst of the three.

Quality will out as they say. Not taking anything away from THS, just observing.

https://www.theguardian.com/business/2021/may/24/global-commodity-prices-fall-china-cost-rises-iron-ore-copper

"... Prices of other important industrial metals, including copper, aluminium and zinc also came under pressure. The share prices of London-based mining companies on the FTSE 100 also fell, with the precious metals firm Fresnillo closing down 1.6% and the copper miner Antofagasta down 0.9%.
China’s intervention comes as... "

There's a quote from one of the guru greats of yesteryear (Jesse Livemore) that runs along the lines of :

Don't even try and fathom out why a stock drops in price. You'll never find out the real reason in time enough until long after it's far too late to take any appropriate action.

You were/are supposed to buy/sell according to your strategies and not get sidetracked by day to day girations of the SP.

He committed suicide in the end.

" ...even with a 10% fall today SLP is still undervalued..."

--------

Krristt aye! Beyond dispute. Beyond.

The SP seems only to keep pace with the excellent earnings increase year after year, in that the SP rises - but so are the earnings for the past half dozen years. So it stays undervalued defacto, back to square one!

However, the market has never increased the SP enough to correct the imbalance of perceived fair value to the balance sheet metrics of a level playing field compared to the industry averages.

So yes the SP rises dramatically each year - but so do the earnings in each quarterly update keeping the stock permanently undervalued.

Even if earnings were flat y-o- y, the SP would still need to rise substantially just to bring it into line with the industry average. It's only rising in line with increasing earnings - from a low valuation, leaving the stock perenially undervalued.

Why? That's the question. Why? Years are passing.

That fact alone should have protected the SP from market pullbacks like today, but it didn't.

Whatever, one is not supposed to tell the market what it should be valuing a stock, as it's reckoned to be akin to standing in front of an oncoming locomotive telling it to turn first!. But it does look like the market is determined after all these years as a deliberate act to keep SLP on permanent undervaluation.

There is no argument against SLP being undervalued in comparison to its industry peers - the big question is why???

Had a quick look at some free sites for pivot points in SLP - and what a wild collection
- so tired as I am this evening, I input today's data into my own spreadsheet for calculation
- and the wildness I saw on the free sites, remains.

Was surprised to see the pivot point as a hefty 120!
- well away from tonight's close of 115.5

That's an enormous difference.

So Wed, the SP needs to sprint to 120 quite promptly, to show serious intent as safety lies at no less than 124 IMO.

On the other hand, after Tuesday's mighty one-day crush, if the SP can't make it to first base of 120, then it's more likely to start sniffing around 110, and this major pullback today, would be looking to develop into a stronger retrace.

Bit of a tall order, to first get to 120 with no reward of safety (that's 124) but that's the size of the task tomorrow.

It's easier for the SP to take the lazy route of least resistance to 110, rather than 2 jumps north to safety.

A suck it and see, day.

All IMO only.

Concludes . . .

Summary:
. . . I'd like to think that those who subscribe to an immediate end to this downtrend from tomorrow are on the money because all significant ma trend lines are down to the next, to the last significant.

Tonight the SP has come to a stop on the last before the mighty 200 and that is the 100 day average.

Coincidence, or is that to be smashed tomorrow downwards too?

If so, I don't think that the 200 would give way at all, nor do I think it's on the cards for a flying visit from the SP, but should the 100 day average fall, then I think the result would be the same as last July and the 200 would repel, and send the AWOL SP packing - back to the barracks pronto. (The 200 currently resides at 90p's tonight).

For tonight I'm going with those who opine the SP will do a scalded cat and jump off the hot tin roof that is the 100 day average trend line.

Still doesn't explain the extremely violent reaction by close of today's huge double figure % SP fall.

Appears a bit extreme to me, if it's just a reaction to a fall in Rhodium prices.

So the question remains to be answered by unfolding events;
is today's fall just a reaction to market forces, alone?

Well tonight's close got my attention. As per usual I ignored the recent Overbought condition that bubbled up at the beginning of this month from around the 5th and exited that condition on the 12th.
And as per usual I took little notice - as Overboughts are 10 a penny in a predominately, strongly uptrending stock like SLP - and have all ended mildly
- hardly worth mentioning in a post.
So this reaction as an added consequence of coming out of overbought is more reminiscent of an underperforming stock, in that it always stings a bit.

What I've been waiting for is something that is almost at record levels of absence and that is an Oversold condition. Now you'd think especially after today - this would tip it over the edge, but no, true to form, the strength of progress signalling it's near-record long absence, means the SP is still not in oversold territory, although it is moving towards that area as it's defo in the bearish deciles of relative strength, but Oversold condition - still hasn't triggered.

So, it's not panic selling (at least not yet).

And it's not MM's manipulation either - the volume is humungous tonight! Consider:

The 20 day average volume is 1.2m

50 day average volume is just under 1.3m

200 day average volume is 1.6m

Today's volume is almost 3.7m!

So today's volume of almost 3.7m is some deadly serious selling and subsequent SP decscent has not been achieved on an average volume trading day, suggesting (manipulation conspiracy theories aside) either some investors are spooked or some investors are in receipt of some information that propels them to sell-off (and re-enter at a more opportune point?)

Who's doing the selling? The Chinese? Because one thing's for sure - that's some damn serious volume today, it's real-deal, bona-fide selling!

Some Chinese manufacturers shut down their factories the other week/month, not due to high prices - but because they just can't get supplies. But how cheaper prices will free up supplies eludes me; wouldn't it have the opposite effect on manufacturers IMO - cheaper prices?

And if it is only genuine market forces alone, well this is not the first occasion of swings in supply prices, yet a 10% drop in a single day is some going (THS hasn't escaped today either; JLP got off scott free).

The Ultra Short term trend had turned bearish recently - of which I took no notice, but in the last 24/48 hours the Short Term trend has turned bearish too - and it's that trend that I often take a lot of action on.
The longer term, predominant trends are full-on bullish, suggesting for the moment that all is - just noise.

I'd like to think that those who subscribe to an immediate end to this downtrend from tomorrow are on the money because all significant ma trend lines are down to the next but one, last significant.

Tonight the SP has come to a stop on the last before the mighty 200
- and that is the 100 day average.

- Continues > > >

Thanks for that Book recommendation, Luna. I do have several books on Bubbles and crashes including the daddy of them all the Popular Delusions and Madness of Crowds definitive record by Mackay (1869 I think). Stunning book; amazing data considering the difficulty of research centuries ago.

I managed to download your book as an Ebook for free on this occasion, liked the drama documentary opening to it; the innocent analyst guy from nowhere built up to guru status by the crowds - could imagine it as a TV special if expanded so :)

" I did notice that there are 18 estimates for the 21/22 and 22/23 figures but only 10 estimates for the 23/24 figures. Is this likely to have skewed the figures?"

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More is better, however this first forecast of the trading year is mostly a uniformly high number on this occasion. As the year progresses you can see forecasts for net profit falling to often half the number who contribute to revenue forecasts.

Revenue, year after year, is noticeably quite commendably accurate to that achieved by BT. With generally lower analysts contributing to net profit as the number of forecasts build up, the more often they are wide of the mark.

Even though year 3 is a low turnout in these forecasts, it is higher than general averages once the year gets under way. Not worth fine slicing the analysts as once the actual results are known, all previous years forecasts are forgotten for analytical comparisons.

Whatever, their forecasts do inform as to the likely direction of sentiment in any stock so worth noting what the overall direction as a consensus is, in general.

I believe redundancy payments are amoritised over several years using free cash flow and not deducted flat in the year they are paid out. So although they push up salary expenses they only do so proportionately, spread out. I could be wrong though.

Well, unless anyone has any alternative insights, that's as good enough a suggestion as any - the super-deduction tax break.

Only thing is, tax breaks are designed not to show up in net profits but to boost free cashflow, otherwise the taxman gets a but iffy.

(Free cashflow 'bonus' was mentioned in several media updates in March, on BT's super deduction tax break).

But if it is the tax break - then it's likely that year 3 net profit will go on to recommence increasing in year 4, and so on. . .

Honest answer whetherboy, is, I don't really know for sure, why year 3 net profit's wheels have fallen off. I'm open to all views.

Bit of a bummer close to the day - but if we can accept wild, intra-month spikes to circa 147 etc., then just like the other month dipping down to 102 we should expect the occasional opposite direction in intra-month spikes.

Must admit when I saw the mid 140's this month, I thought: if it looks like holding then that's my so-called "modest" gain for May up in smoke but here it is tonight, admittedly a little below my "modest" target for May (v high end of 120's to borderline 130) - it could still get back up there, by month end, as quite a bit left in trading days in this month yet

At this close tonight, then the whole spring season March, April and likely May has so far proved very reliably predictable in performing modestly outside of the "winning months" - which are even more reliable.

My biggest fear for a true stinker - is June, but let's see how May turns out first.
If June does go south and looks like closing markedly lower than it opens (cyclical charts) then I'll put out a call for one of Stoodio's magic posts as the market SP always comes alive on those occasions :)

Concludes (Summary) > > >

. . . Best consensus forecast recovery for revenue in living memory.

Net profit terrific too, up to year 2.

But year 3 a miss.
But whilst a miss it still showing that net profit forecast is still far superior to that achieved for the full year just closed 20/21 which was in the lowly £1.4bn's.

What's not to like :)
(Apart from the year 3 net profit forecast) - everything else - Bull's-eye! Bazinga!

Here's the initial Q1 forecast of this new trading year (& full 3 year forecasts) -

https://www.bt.com/bt-plc/assets/documents/investors/financial-reporting-and-news/latest-consensus/btgroup-consensus-21-may-21.pdf
------------------

And at long, long, last, after many a year wait, it's good news!
BT now sports cumulative, year after year of increasing revenues! ***

Quite a way to go before getting anywhere near the highs of revenue produced in yesteryears - yes, but that's the name of the game now - not where will the floor be/when will revenue cease falling?

But now a case of - look at it increasing/how long before revenue gets back to the highs of the £5 SP era of v early Jan 2016/ late 2015?

That's a sentiment changer!

But anyway sentiment changed bullish last November, this consensus forecast just seals the deal. Expect a total and complete about-face in the media.
Let's just show the full 3 year's revenue to illustrate what I'm referring to, then the revenues*** no-worries-anomaly, I asterisked up in the first para.
Here we go -

Consensus Revenue forecast for:
2021/2022
£21.224bn
'
2022/2023
£21.289bn
'
2023/2024
£21.434bn

- See? Each year producing higher revenues than the year that preceded it, with a massive jump in year 3 !
What does that auger for 2024/2025? One can only guess :)

Now that no-worries-anomaly-revenues ***, 2021/22 does show the actual floor in revenues - it's lower than the year just closed. That was expected, and is in line with expectations. This year revenues ARE the floor!
But what will the world see after this consensus update? (that's all of them)
- Only a strong showing of revenue increasing year after year. That's what the institutions have been dreaming of! Now that the analysts say - it's here!

Now Net Profit - and a big, big surprise (for me anyway) -

Consensus Net Profit forecast for:
2021/2022
£1.649bn
'
2022/2023
£1.804bn
'
2023/2024
£1.703bn

- Just look at that year 2 net profit - higher than the past 2 years actually achieved net profits!

But the anomaly is year 3 (2023/24)
- it's hit a wall and starts declining.
Is it the start of a reversal, or just a hiccup waiting for the benefits of the infrastructure build to complete further? I don't know. Until now, it's been a case of net profit leading the way and revenue dragging its heels.
Now a change of fortune in the two metrics. What does it mean? Only the analysts and the BOD know. No doubt someone will tip off the media instead of us, in an RNS.

Q1 itself, reveals Q1 revenue is less than the last Q4 revenue which was low anyway.
But it all ties in with the 1,2,3, full years up above so no biggie as this year is the floor for revenue anyway.

And in keeping with the full years, just look at Q1's net profit forecast
- £354m against actual achieved in Q4 of barely £200m! And that too ties in nicely with the full year's forecast.

Short para to finish off, concludes next > > >

Divermke - Whahaay! Our very own potential Edward Snowden. Or failing that, Daniel Craig - He can tell you but then he'll have to kill you - so I'm not asking!