The technical reason behind Bitcoins momentum could be due to the fact that its been overbought ,as the trend line suggests in our chart.Its due for a correction to follow the upwards trend from the trend medium price of $55-60,000.
At its trend peak it hit over $70,000.
Now it’s priced at $61,450. A significant 15% in the past 7 days. For the investors that bought at the peak , it represents a steep drop in their portfolio.
TECH OUTLOOK-Daily chart
AUDUSD has been floating around 0.63 to 0.7 range for the past few quarters now. Currently at 0.65 it’s at a steady pace towards the upside but still relatively weak compared to the previous years which averaged 0.75-0.85 . AUDUSD is just under the 200 day exponential moving average now and showing that it’s a good buying opportunity.RSI is at 40, under its 50 mark showing sold out conditions.
FUNDY
Currently the AUD has lower international buying power and is cheaper for foreigners to come to Australia and purchase its goods and services boosting export growth .
Australian GDP has been sluggish , not fully going in line with the inflation rate which was around 7% in 2023 whilst the GDP rose September 2022 to September 2023 to 2.1% nominally.
Current yearly CPI is at 4.9% whilst the cash rate at 4.35%.
For America CPI is at 3.1% , cash rates at 5.5%.
ASX200 sitting at 7600 , just under its record high of 7700. Lowering the interest rates in the future for both FED and RBA will lift up the Stock Market even further up.
US 10yr bond yields are up at 4.275% . Quarterly high was 5% and a low of 3.8% .
CALENDAR
Chinese Central Bank has lowered its 5 year Lending rate by 25 basis points to 3.95% to assist with economic growth and stabilise the property market. This week the Feds meeting to see if they will lower rates , the speculation on the Street is that it will have to wait till June with 53% of surgery respondents sure that its going to be then.
Share Investing basics 101
What are shares ?
Shares a parts of a company traded on open stock market exchanges and OTC(over the counter ).
Each share represents 1 share in a company. Its value is determined by the net worth of the company also called the shareholders equity divided by the total number of shares issued to investors.
There are different share types
Ordinary shares – The most popular one where shareholders are allowed to vote on meetings and receive dividends , but if the company doesn’t issue a dividend they aren’t eligible to demand one.
Preference shares -Superior to ordinary shares, they have the priority rights to receive fixed dividends and their capital could be returned if the company goes into liquidation.
Redeemable Preference Shares-Where shareholders have the right to redeem their holdings in case of insolvency and get their shareholder capital back through issue new share issuance or asset selloff.The company has the right to redeem-buy back the shares back from the shareholders in due date .The timing will be laid out in the investors prospectus.
Convertible Preference shares- Preference shares that give you the right to convert them in the future into ordinary shares.Preference shares give lower dividend that ordinary as they are guaranteed.
What are dividends ?
Dividends are payments a company gives out to its shareholders after its makes a profit.They can come in quarterly , semi annually or even annually, most come in semi annual payments. Some companies don’t even pay out dividends to their shareholders as they could have made a loss or are strategically not paying out dividends and just reinvesting their profits . Investors can take advantage of this too through capital gains, as the company’s share price can rise rapidly and allow investors to sell at a future date and keep their profits.
What’s ex-dividend and record date?
There are actually four major dates in the process of a dividend distribution:
Investopedia
Australian Taxation rules for dividends
Rules are simple In Australia for your dividends, if you invest in a company that pays its fair share of tax which is around 30% you are eligible to for franking points. It varies on each company ,some companies provide 100% whilst some around 50%.
Let’s do some examples.
You have 5000 income from dividends.
Your franking credits are at a 100%. You receive a 30% dividend imputation credit as your company paid full Australian company tax which gets claimed as a tax refund.
5000*(30/70)=2143
Taxable income 5000+2143=7143
Let’s say you are at the 15% income tax bracket.
TI*0.15% = 1972 Tax payable
TP-Franking credits rebate
1972-2143= (171) REFUND
Therefore you are eligible for a tax refund .
At 32.5% income tax bracket
TI = 2321 Tax Payable
TP-Franking credits Rebate
2321-2143=178 TAX PAYABLE
More explanation
HR Block
https://www.hrblock.com.au/tax-academy/tax-on-dividends-investment-shares
Mountain Tech Analysis 