Week in review (29Nov21-03Dec21)

This has been a week of much losses with most of my holdings in red.

What could have accounted for such a red week for most stocks?

• Omicron started the decline that led to travel restrictions & banning of flights for selected African countries
• Federal Reserves (potentially accelerating) tapering
• Federal Reserves to raise the interest rates faster to address the “non-so transitory” Inflation
• Investors turning to value stock instead of growth
• Profit taking after a good run
• $DiDi Global Inc.(DIDI)$ De-listing > with concerns spreading to other China stocks
• Latest non-farm payroll 210K was a far cry from the expected 550K (as per investing.com) though the unemployment rate dropped to 4.2% instead of the 4.5% expected

We need to differentiate between the stock price falling because of the company’s performance, sector’s performance or market wide movement. Why should we sell a company with good business fundamentals if the drop of price is market wide (and nothing to do with business performance). Personally, I will hold or even add to some of my holdings so long the business fundamentals remain sound. To try to get the best price entry, I suggest a combination of technical approach after qualifying a business through their fundamentals. For example, I am now waiting for the price reversal (using 1 week or 1 day chart) for stocks like $Alibaba(BABA)$ & $Tencent Holding Ltd.(TCEHY)$ . I intend to hold these stocks for years. Time will prove if I am a fool or brave.

What should we do for the week ahead?

Personally, I think that the decline should persist into the next week as we inch closer to vaccine makers & health agencies updating about the efficacy of their vaccines. This has presented few good buying opportunities for some stocks. However, let us try to buy along the up trend - some patience help. An uptrend comprising of 3 candles on the 5 minute period is way less accurate than the same setup on a 1 Day chart. Let us not forget to confirm the trend after initial reversal. If the volatility is affecting you badly, you may need to change your portfolio size or choose a bigger investing time frame. Invest safe.