Winning Strategy for 2024
In order to understand my strategy, you have to first understand the outlook.
Fed will cut rates in Q1
With the inflation coming down at a consistent pace, the Fed is confident to no longer require any hikes. The next step is to watch for the first cut. Listen to all the Fed speakers and you will know they want to say they are ready to cut. But if they say that, they know we investors and traders will start pouring in and create a giant balloon in the market. As Harvey Specter always says, “Always play the man”.
Presidential Election 2024 catalyst
As you know the presidential election will always be a fiesta. A real drama to watch especially for those not living in US. Biden will want to stay in office so he will do everything he can to boost the economy and provide more stimulus to the people. When people have money in their pocket, they are happier.
Strategy for 2024
Look at AI/Chips Industries
I favour $NVIDIA(NVDA.US$ and $Palantir(PLTR.US$. Nvidia will continue to pump out AI-dominating chips which every tech companies will want to scoop up. $Advanced Micro Devices(AMD.US$ will try to catch up but fall short of the top. Palantir has proven itself to be a real powerhouse in AI technology. It has been winning deals from governments of different countries and proven itself to be reliable.
Rise of China?
I can tell you China is coming back but you don’t want to hear that. Xi Jinping has been delegating some responsibilities to his No.2 and focusing on steering China back to the right path. The real estate fiesta and tech crackdown have both come near to its end. But what is important is at how China is continuing to elevate its chip industry. Take a look at Bloomberg’s article on Huawei. I favour $JPMORGAN ACTIVE CHINA ETF(JCHI.US$.
Luxury Spending
As I said earlier, we can expect rate cuts and more stimulus. It is normal that humans would spend more on things they want instead of need. $Hermes International SA(HESAY.US$ will benefit alot here. Especially when China wealthy starts to spend more.
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digimonX : I don't think the Fed will cut rates in Q1. I think rate cuts probably start in Q2. Anyway, I am happy as long as Powell doesn't say shitty things to tank the market.
As for the tech sector, I agree nvidia will still own the AI market. However, industry players want a second source (because nvidia has a reputation to be "unfriendly"). AMD is the second source. I hope AMD can get enough capacity from TSMC to produce many MI300s. The initial batches of MI300 cards all go to the El Capitan supercomputer installation. AMD's investment in opensource AI software platforms is the right direction as it allows models to be hardware agnostic. If they are successful, switching underlying hardware will be simpler than many think.
Palantir has been implementing AI-based solutions well before AI caught mainstream news. Many people have issues because the things Palantir does is not always clear. Many of their customers are government agencies & contracts/engagements are confidential. This is a company that one invests partly based on numbers & partly on gut feel. I own some shares & hope the company does well.
Rexon CapitalOP : Thanks for starting a discussion
Powell will speak today so we shall see what his views are. Most likely he will remain neutral unless being tricked into showing his cards.
I agree with your views on AMD. However, I think they will invest more into data centers as they are currently dominating in that area. My biggest worry for NVDA is the US government trying to hamper it. This will help AMD to catch up. Intel has already taken a comfortable bed in the ground.
Palantir really needs to promote its AI model towards business and generate more revenue. The next biggest catalyst will be S&P500 inclusion.
digimonX : I hope Powell remains neutral like you mentioned rather than saying things like "not confident the Fed has done enough", "higher for longer", etc. I have phobia every time this guy comes out to talk.
I don't currently own nvidia & am currently selling put options at high $300s & low $400s strike prices. If it gets there, I'll pick up the shares. If not, I'll just collect the premiums. At some point, I do wanna own some nvidia shares. I don't like Jensen Huang because I find him arrogant but he can really make tons of $... Gotta give it to him.
102180832 digimonX: Powell hint more hike may happen . Time to