Ronnie Hew has 10 years of experience in technical and visual analysis of volatile financial markets with risk management techniques. He was educated in statistical and technical analysis of financial charts and has been teaching about stocks, bonds, commodities, and currencies for five years. He also offers specialized training on shorting stocks, leveraged indexes, and options with risk management. Hew generously shared some of his financial insights on market analysis, the pandemic, and general advice with The Edge.
What do you find most exciting about being a financial analyst?
The most exciting thing analyzing the financial markets is that it tells you what most fund managers are investing in, where the demand is, and when that changes. New trends in technology and healthcare is revealed in the stock charts and news, which is confirmed by the earnings of these companies. This desire for knowledge and opportunity is what drives all types of traders.
How important is it to perform technical versus fundamental analysis of securities?
Technical analysis is always the priority as it’s a picture of supply-and-demand, momentum, or strength of the price, whereas fundamental analysis is what should happen academically and logically based on textbook theory — it is the consensus and choice of the majority. Technical analysis is the reality of price. It is objective, unbiased, and the bottom line in performance.
Were there any positives observed in the financial markets during the pandemic?
The beginning of this new pandemic started on December 2020, and the new bull market for US equities started in March 2020 and then lasted for 20 months, despite the obvious economic despair that was the conventional knowledge at the time. It’s a reminder how resilient and adaptable the human spirit is, and the businesses’ desire to survive despite the fundamental implications. Despite a history of dreadful world events, the financial markets find a way to adapt throughout time.
What are some factors to help mitigate risk in the market?
For advanced traders and fund managers, the use of derivatives, trailing stops, diversification, market timing, and buying quality indexes will work. This combined with intermarket, technical, fundamental, statistical, and psychological analysis puts volatility under control. A proactive approach is required as opposed to a buy-and-hold tradition.
What are the current trends that will most likely continue?
Currently, as of June 17,2022, the world stock markets continue to fall to the lowest prices in a year caused by a trend in higher rates and poor economic growth. Bitcoin and technology continue to fall because of poor earnings. The purpose of continued higher interest rates was to fight inflation, and it’s working. As of the beginning of June, the price of oil, natural gas, and unleaded gasoline is in a downtrend.
Unfortunately, anyone owning energy stocks will see a negative return and for a while, as this trend has just started. The good news is we are now closer to the end of rising rates and hopefully, before year end, world stock indexes will rise again.
What evergreen advice do you have for novice investors?
There is a rising trend towards clean energy, even more so now with the present price of oil and inflation. The favourites are electric, natural gas, and solar companies — that’s where the demand is now. Anything related to lithium, uranium, palladium, and hydrogen are getting the global attention as energy alternatives. These are the ones to watch.
Rose Ho | Assistant Editor