Daily 4XSetUps - Bloodbath In UBSG Price Action Has Begun Yet

Dec 20

2024/12/20
Daily 4XSetUps - Bloodbath In UBSG Price Action Has Begun Yet
“bullish price action appears to be melting away at the end of year`24!
why is that? will there be a trend reversal? does it goes further down?”



The New York stock markets stabilized somewhat yesterday, Thursday, December 19, 2024, after the latest interest rate cut. However, the current price action on Wall Street remains nervous, because while the DJIA has been trending slightly down and down and down for days, the SP500 and/or the NDX are still more or less around all-time highs. And this despite the fact that in the historical context the stock market is truly overbought - as far as the fundamentals are concerned. For example: The P/E ratio is a classic measure of a stock's value indicating how many years of profits (at the current earnings rate) it takes to recoup an investment in the stock. The current S&P500 10-year P/E Ratio is 36.5. This is 79.2% above the modern-era market average of 20.4, putting the current P/E 2.0 standard deviations above the modern-era average. This suggests that the market is Strongly Overvalued. The day before, the prospect that there would only be two interest rate cuts from the US Federal Reserve in 2025 had hit traders and/or investors hard. Cheap money - and correspondingly increasing price action on WallStreet - will not exist in a linear way in 2025. At the beginning of the week, I wasn't expecting such a hawkish voice from Powell; let alone with such a reaction from the market, i.e. the majority of traders and/or investors (like you and me). Because I actually formulated some 4XSetUps again at the beginning of the week, but the price action (still) punishes me for lying! I can no longer see a clear upward trend on WallStreet, which is why I closed all of our 4XSetUps - regardless of whether we were and are in profit (or not). Regardless of the price action, because we had enough profitable 4XSetUps in 2024 - the best year since I started formulating them publicly."Because just thinking for yourself makes you smart," a German political analyst friend told me yesterday - in another different context. In relation to the fiscal policy problems in France, economic policy problems in Germany, and/or even the USA in relation to Trump's comeback to the office in 2025. Because what worried me all day yesterday was the fact that the points in the stock markets on Wall Street were lost in late trading. The DJIA ultimately defended a slim gain of +0.04% to 42,342.24 points. And ended trading close to its daily low, after gaining more than +1.0% at its peak. At least he ended his historic series of ten losing days in a row. According to Bloomberg data, such a long dry spell had not occurred since the 1970s. The market-wide SP500 slipped late by -0.09% to 5,867.08 points. While the technology-heavy NDX continued the previous day's slide with a discount of -0.47% to 21,110.51 points. A slump in the share price of the chip company MU weighed on the mood there. Which is probably why the CNN sentiment indicator is interactively ambivalent in the basement - but the stock market in the historical context is nevertheless fundamentally totally overvalued.


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A new daily 4XSetUp will be available here on TradingView
when a trading capability arises, in January 2025 (or not)! From January
2nd, 2025 there will definitely be “Another 48h - DXY …” analyses,
reviews, and/or even my opinion so that we can continue to
(not) learn something new about the DXY .
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“Pay for the person, not the job. Look at what people in comparable jobs with comparable experience and credentials make, add some small premium over that, and build in bonuses or other incentives so they will be motivated to knock the cover off the ball. Never pay based on the job title alone.”
Ray Dalio

-----------------------------------------------------------------------------------------
A new daily 4XSetUp will be available here on TradingView
when a trading capability arises, in January 2025 (or not)! From January
2nd, 2025 there will definitely be “Another 48h - DXY …” analyses,
reviews, and/or even my opinion so that we can continue to
(not) learn something new about the DXY .
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CHF 29.57 : 2024/10/30 - Last Annual High 2024
CHF 29.10 : 2024/11/07 - Last False New High 2024
CHF 28.78 : 2024/06/03 - 2nd Annual High 2024
CHF 28.62 : 2024/03/26 - 1st Annual High 2024
CHF 28.18 : 2024/07/15 - False New High 2024
CHF 26.50 : 2024/07/31 - Upper Trendline Bearish GAP
CHF 26.35 : 2024/12/20 - last price action
CHF 25.68 : 2024/08/02 - Lower Trendline Bearish GAP
These are the most important price actions of the UBSG shares. The UBSG share has recently shown itself to be robust and has recorded positive developments. It is noteworthy that UBSG shares rose by a more than impressive +25% year-on-year. This underlines the strength of the Swiss financial giant despite challenging market conditions. However, the basic main momentum towards CHF 30 is likely to have fizzled out for now - and we bulls should content ourselves with baking smaller rolls until the end of 2024! What do I mean by that? The GAP between 26.5 CHF and 25.68 CHF has to be defended for the time being. The best timing should be a trend reversal above 26.45 CHF until the end of this year 2024! Why? Because we can then still argue in the form of an upward trend since the annual low in August 2024. Because since then the lows have always been higher than the previous ones. Which should even be enough until the end of this year 2024. And that would be a great start into 2025 - only to reach new multi-year highs again in 2025!?

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CHF 33.00 : 2025/06/30 - Target Price
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CHF 26.43 : 2024/12/20 - Closed At 1st Price Today
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CHF 26.35 : 2024/12/20 - last price action
CHF 28.21 : 2024/11/08 - Entry Price
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CHF 25.00 : 2025/06/30 - Stop Price
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That's what I wrote a few days ago about the UBSG share.
But in the meantime, new US economic data came out: higher US inflation and an even higher US PPI while US growth remains solid but the US unemployment rate is also threatening to skyrocket! And all of this while the FED lowered interest rates and expressed itself hawkishly - and traders and investors sold shares significantly on a trading day for the first time. Here the rabbit is buried in the pepper! Because I think the problem is that the USA does not seem to be growing out of US stagflation - higher US Annual Growth Rate as US Inflation), while the US unemployment rate is threatening to rise at the same time. And that, at least in my opinion, is also the reason why the price action on Wall Street suddenly seems to be bearish again. Although the mood on Wall Street is not euphoric, as the CNN Sentiment survey indicator shows, the stock market is overpriced in a historical context! Yes, there is even a threat of recession, what traders and/or investors in the bond market are to be believed, which the price action of the US10Y proves while the DXY also tends to rise. Which is why I closed all of our 4XSetUps for the first time - and also because we had better performance this year than ever before (since I started to publish my 4XSetUps in 2022).

But don't get me wrong - I don't expect
a crash in the stock market! DJIA or SP500 and/or NDX !
Let alone I want to brag about Old Testament bad news at this point and/or even conjure up a New Testament Armageddon. But if I put in words everything together I hear and/or add up all the numbers, then I currently prefer the bearish side on Wall Street - and currently prefer to realize all the gains and losses. Because we have Christmas just around the corner and/or also the Jewish festival of Hanukkah. And from January 2025 also Trump is back in office. Therefore, I think that a wait-and-see attitude, without being positioned long or short on Wall Street, even in DJIA or SP500 and/or NDX , is the best of all options for us traders and/or investors. And that includes our one-year bond, since the beginning of March 2024 US01Y . In order to then (not) enter again in January 2025!?


Have a good time
- regardless of the price action!
Aaron



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