Sie sind auf Seite 1von 12

This Is Tomorrow

Equity Markets Update


20-25 April 2014

This Is Tomorrow, Equity Markets Update is a research based on new approach to


quantitative analysis in which the goal is to develop better understanding of market movements and risk management. This is a practical solution and comprehensive picture of certain security with a view to improve investment performance. It offers a smart trading capability along with a disciplined approach.

This Is Tomorrow | Equity Markets Update


Event 80% probability
Worst Case Scenario Potential Month

Unfavorable Move

UP Trend

Down trend

Market State

Short-Correction

Mid-Correction

Potential week

Medium-term

Medium-term

SPX NDX DJI RUT GOOGL AMZN FB AAPL MSFT HPQ WFC

1860 3535 16410 1138 543 324.9 58.95 524.9 40 31.9 48.9

TR TR TR TR TR TR TR TR TR TR TR

8 5 5 5 5 5 5 5 5 5 5

1700 3150 15170 1070 505 309 55.9 499 37.7 29.5 45.6

1770 3360 15700 1080 515 312 56.7 516 39 31.6 46.9

1815 3410 16015 1095 537 315 58 522 39.2 31.9 47.4

1880 3690 16500 1190 564 329 62.5 522 41 33.1 50

1850 3630 16170 1180 585 348 64 540 39 30.7 46.9

1710 3150 15660 1065 465 315 51.6 514 35.3 27.8 44.8

1860 3480 16180 1130 540 315 58 518 39.2 31.9 48.5

1835 3530 16050 1145 585 337 60.7 522 39.3 31.5 47.4

1870 3630 1180 315 56.8

58 39 31.6 47.4

31.5 46.8

49.7

Page 2 | 20-25 April 2014

Bottom Out

Pivot Level

Short-term

Short-term

Long-term

Long-term

Last Price

Side-way

Scenario

Strategy

Top Out

Symbol

Risk

This Is Tomorrow | Equity Markets Update


Demand-Supply Levels, Over-Bought & Over-Sold (During Next Week) Probably Distribution
S&P500 E(X)=1825 NAZDAQ 100 E(X)=3550 DJI E(X)=16080 Russell 2000 E(X)=1135 GOOGL E(X)=558 AMZN E(X)=329 AAPL E(X)=525 FB E(X)=61.25 MSFT E(X)=40.4 HPQ E(X)=32.7 WFC E(X)=48.3

4%
1900 WCS 3740 WCS 16580 WCS 1210 WCS 645 S 362 S 595 S 69.8 S 47.4 S 36.7 S5% 50.5 OB

12%
1880 S 3700 S RISK 16500 RISK 1200 S 608 S 348 OB 560 OB 68.5 S 41.65 WCS 35.5 S 50 WCS

12%
1870 RISK OB 3660 S 16450 OB 1180 OB 592 OB 337 P 544 S4% RISK 64 S 41 S 33.6 S 49.8 S RISK

34%
1865 S 3630 OB 16050 1160 S 572 OB 332 OB 536 OB 63.2 RISK OB3% 40.7 RISK OB3% 33.3 OB3% 49.2 OB3%

34%
1840 3600 S 16015 P 1140 P 568 RISK 329 S 527 P 62.6 S 40.4 P 32.9 S3% 48.9 S

34%
1815 P 3510 P 15970 D 1130 OS 552 P 315 P 520 D4% 60.45 P 39.2 D3% P 32.6 S 47.7 D2%

34%
1780 D 3450 D 15700 D5% RISK 1112 D 538 D5% RISK 312 D3% RISK 516 RISK 58 P3% 39 RISK 31.95 OS3% 47.4 D3%

12%
1770 OS RISK 3420 P 15440 OS 1095 P 515 D 309 S 511 OS 56.8 D10% RISK 38.9 P 31.6 D3% RISK 46.8 OS4% RISK

12%
1740 D 3360 OS RISK 15340 D 1080 OS RISK 510 OS 296 500 D5% 55.9 OS 38.1 D 30.6 OS 45.6 D1% WCS

4%
1700 WCS 3150 WCS 15170 WCS 1070 WCS 503 D 280 480 WCS 54.4 WCS 37.5 OS 29.8 D 45.2 D RISK

Page 3 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update


Probability Distribution, Expected Value Probability Distribution S&P500 NAZDAQ 100 Russell 2000 GOOGL AMZN APPL FB HPQ WFC 4% 1950 4100 1200 600 370 600 71 37 51 12% 1900 3700 1180 592 360 560 70 36.5 50 34% 1860 3620 1160 580 345 545 68.5 35.5 49.2 34% 1770 3400 1090 530 315 480 58 32 47.4 12% 1700 3300 1080 510 300 450 56.8 31 46.7 4% 1650 3000 1045 480 280 400 54 30 45.5 E(X) Q2-2014 1810 3510.8 1126 552 330 509 63.3 33.7 48.3 E(X) 2014 2060 E(X) 2014 13%

42.8

60%

Probability Distribution S&P500 NAZDAQ 100 Russell 2000 GOOGL AMZN AAPL FB HPQ WFC

4% 1880 3700 1200 600 370 560 70 35.5 49.8

12% 1860 3620 1180 580 360 544 69 33.9 49.2

34% 1830 3515 1150 560 332 535 63 33.6 48.5

34% 1770 3400 1100 520 315 520 58 31.6 47.4

12% 1730 3360 1090 500 305 500 56 31.4 46.8

4% 1700 3300 1060 490 280 480 50 30.6 46.4

E(X) Month 1798 3468 1127 540 325.7 525.5 60.94 32.65 47.9

Page 4 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update

Forecast S&P500 NAZDAQ 100 Russell 2000 GOOGL AMZN FB HPQ WFC APPL

Technical Target 3-9 1-3 months Years 2050 2700

Q1 L 1732 H 1887 3100 1070 500 300 54 L 1700

Q2 H 1900 3700 1200 600 350 70 37 52 33 47 L 1800 3400

Q3 H 2060 4100 L 1850 3100

Q4 H 2050 4100

42 52

51 60

27.3 44.2

33 50

29 46

38 52

35 48

45 54

Page 5 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update


Forecast S@P 500 projection (Q2-2014) NAZDAQ projection (Q2-2014)

HPQ projection (Q2-2014)

WFC projection (Q2-2014)

Page 6 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update

Symbol NDX Symbol HPQ Symbol WFC Symbol MSFT Symbol FB

Initial Move 1[35103600] 2[36303450] 3[34503600] 4[3310 3700] Initial Move 1[31.532.7] 2[32.831.9] 3[31.633.6] Initial Move 1[49.348.1] 2[48.947.5] 3[47.748.9] 4[46.8 49.2] Initial Move 1[3941] 2[4139.2] 3[39.2 40.5] 4[38.1 41.6] Initial Move 1[5662.5] 2[63.256.7] 3[56.864] 4[58 64]

CLOSE ABOVE/BELOW 33604100 33603150 CLOSE ABOVE/BELOW 33.3 37 31.6 30.5 CLOSE ABOVE/BELOW 49.2 52 47.4 45.5 CLOSE ABOVE/BELOW 41 46 41 38 CLOSE ABOVE/BELOW 64 70 64 56

S1/S2 THEN 34504100 30003600 S1/S2 THEN 3437 2932.5 S1/S2 THEN 47.452 45.249.7 S1/S2 THEN 4146 37.641.6 S1/S2 THEN 6571 5664

BUY@3450 L A H -2.5 8 18 -13 -4 4 BUY@32 L A H 6 11 15.5 -10 -4 1.5 BUY@47.4 L A H 0 5 10 -4.5 0 5 BUY@39.2 L A H

L 8 21 L -2 2.5 L -3 8.5 L

SELL@3630 A H -2.5 -11.5 10 1 SELL@33.3 A H -6 -10 8 15 SELL@49 A H -1.5 -5.5 3 -1.5 SELL@41 A H

BUY@56.8 L A H

SELL@63.2 L A H

Page 7 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update How to read the tables


Scenarios

10

Optimistic Page 8 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update


In our practical investment, we need to logically consider an investment opportunity based on Risk, Worst Case Scenario, Given supply and demand levels, a series of new information, overbought and oversold, Market direction outlook and current market states including (Trend, Correction, Side-Way, bottom out and Top out). It is formulated the scenario with 80% probability. In fact it may affect the likelihood of an event that interests us. Also it is estimated the probability of the event given the scenario so that it should be compared with risk and worst case scenario. 1- Event: the strategy, scenario and possible move of an event where it is believed to happen with 80% probability. The risk associated with next week market changes is considered against unfavorable move. BEARISH /STRONG SELL TRADING

BE TR

BULLISH/STRONG BUY CORRECTION

BU CO

HOLD/SIDEWAY LOOK TO NEW DATA

HD ND

Bullish strategy (BU):a buying opportunity based on the given risk (Bullish view is dominated) Bearish strategy (BE): Sell the security based on the given risk (Bearish view is dominated) Hold/Sideway (HD): the consolidation pattern is underway. Trading strategy (TR): Buy and sell security between the given trading ranges (Refer to supply and demand levels) Correction Strategy (CO): The security is headed for a modest pullback, Add to your position rather than sell out, the market is
coming back

within next 1 to 3 weeks (Refer to supply and demand level, OB and OS)

LOOK TO NEW DATA(ND) : this is a neutral strategy which looks to new data (Update the probability based on new information), refer to the Pivot Levels and Risk

Complicated (C): I cannot make a forecast until new data is released Potential Move: is expected a positive close at the end of week (more than 1%) is expected a negative close at the end of week (more than 1%) is expected an unchanged close at the end of week (Less than 1%)

2- Unfavorable Move

Risk: sign of unfavorable move against current market direction (Any position can be liquidated after a daily close) Page 9 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update

Worst Case Scenario (WCS): a maximum unfavorable move beyond 68% of probability distributions

3- Trend: is divided up to two groups and indicates the state of a trend against the current level of price. A daily close above and below of a trend levels are of significant importance to trader. For example if the prevail market price is 1830 and the short-term downtrend is located on 1860 then it suggest that market is trading in a downtrend.

Short term Trend: less than 4 weeks Medium term Trend: 1 to 3 months Long term Trend: 3 to 9 months

4- Market State: Provides information on how the market is positioned and where it is likely headed Ended Is already ended

Underway-Ongoing within next 1 to 3 weeks

Underway-Ongoing Within next 3 months

Beginning to end within next 1 to 3 weeks

Beginning to trigger within next 1 to 3 weeks

Swing: market or security is either topped out or bottomed out (OB) Over-Bought level: it is unlikely to have a daily close or far less likely to have a weekly close above the stated price over the coming week. This level helps to determine an area of potential sell opportunity.

(OS) Over-Sold level: it is unlikely to have a daily close or far less likely to have a weekly close below the stated price over the coming week. This level helps to determine an area of potential buy opportunity.

Over-Bought and Over-Sold levels provide the probability distribution of any possible move or price actions over a one week period Minor Supply: a level which indicates a potential pause in current market direction as a result of supply and demand shifts so that it is expected to establish a less than 3% fall in price

Minor Demand: a level which indicates a potential pause in current market direction as a result of supply and demand shifts so that it is expected to establish a less than 3% increase in price

Minor Supply and Minor demand: a range of price fluctuation which does not change the current market direction

Page 10 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update

Strong Supply: a level which indicates a potential pause in current market direction or a considerable pullback as a result of supply and demand shifts so that it is expected to establish an over 3% drop in price.

Strong Demand: a level which indicates a potential pause in current market direction or a considerable snap back as a result of supply and demand shifts so that it is expected to establish an over 3% increase in price.

Forecast: Project a long-term trend in the form a series of closing price and also summaries the percentage change between forecast and actual data.

Distribution probability: indicates the likelihood of various values

Page 11 | 20-25 April 2014

This Is Tomorrow | Equity Markets Update

This Is Tomorrow
FINANCIAL MARKETS UPDATE

This Is Tomorrow, Financial Markets Update is a research based on new approach to quantitative
analysis in which the goal is to develop better understanding of market movements and risk management. This is a practical solution and comprehensive picture of certain security with a view to improve investment performance. It offers a smart trading capability along with a disciplined approach.
Research

Analyst: Rayan Massah Email Contact: rayan.massah@gmail.com

Page 12 | 20-25 April 2014