Our exclusive partner Exante arranged a series of interviews with professional traders and market analysts, including the top TradingView authors. As the first interview of 2015, we are excited to provide you with another expert commentary with one of the most experienced traders and fund managers at TradingView.com Tim West. Tim uses a combination of fundamental and technical analysis for trading, and during the interview he shared his trading secrets. Moreover, he answered one of the most frequent questions at the moment “what does 2015 hold for S&P 500?”
Exante: S&P 500 continues to strengthen and set new highs. What are the technical’s as well as fundamentals telling you about the current situation?
Tim: I think there has been a massive money flow coming into the US equity markets together with corporations buying back their shares, because that is just the only way I can explain why we have been able to continue maintaining this upward trajectory which really is not justified by the underlining earnings growth of the corporations. That is the fundamental backdrop.
On the other hand, the technical backdrop is psychological and the technical’s are certainly more problematic because you do not have the Russell 2000 reaching a new high.
Moreover, there is a lot of confidence driven by the Fed standing behind the market, all the central banks around the world driving liquidity and trying to create money to help lift the economies around the world. Therefore, it is feeding its way into the market, but it is not very broad based.
Exante: What do you do in case the technical’s are showing you different picture than the fundamentals?
Tim: I position myself “market neutral” by finding long positions and short positions to diminish the impact of the markets return on my return. I try to focus on the stocks that are showing relative strength in buying and I want to be short stocks that are at high multiples of earnings and showing signs of relative weakness. I always try to pick solidly-valued stocks that are coming out of low valuation bases. In addition, I want to try to sell short the high flyers that I think are over-owned, over-valued, over-loved and cannot meet estimates. So that’s how I position myself and protect myself against a stock market decline. Continue reading on Exante website…
Stay tuned for the second part of our interview with Tim West. In the meantime, we encourage you to read some of our other interviews with leading experts in the finance industry: Uri Landesman, Giovanni Pozzi and Hendrik Klein.