Is history about to repeat itself?

There is a technique commonly used by traders in the stock market to help them see whether there is a change in the direction of the price movement.

It is called a trendline break.  What it means is that if you see a break in the trendline, the rule is that there is a change in the price movement.

The chart below shows the number of weekly Covid-19 cases for 2 regions in Malaysia where I have drawn some trendlines to show the path of the infection.

• Sabah and Kedah

• Central zone comprising KL, Putrajaya and Selangor

Using the same stock trading technique, you can see from the chart below that there are breaks in the trendlines for both Sabah/Kedah as well as the Central zone. What this means is that the number of weekly cases is expected to go up instead of continuing to come down.

You will notice that the trendline for Sabah/Kedah covered several weeks of declining cases so that a break in the trendline is more ominous than that for the Central zone.  The trendline in the Central zone covered 3 weeks and you could dispute the trendline.

But you cannot dispute the fact that the current weekly level of infection is the highest since the start of the pandemic.

• In Mac 2020, we are seeing about 1,000 odd cases weekly

• In the 7 days from 28 Dec 2020 to Jan 6, 2021, we have 14,953

• This is more than 10 fold larger

And the worst thing is that the positivity rates (number of positive cases as % of the tests carried out) has been rising.

• We are about 8.5% for last week 

• WHO standard is 10%

• There are some states in the USA with 50% 

So what does it all mean? 

• The CMCO, RMCO, and all the other "alphabetic MCO" are not working in terms of getting the virus under control.

• If we continue to do the same, there is no reason for the number of cases to come down.

• Instead of quarantining every sick person, the authorities are allowing the sick to be quarantined at home.  This will just help the transmission as I don't expect Malaysians to be very disciplined. 

We have hit the capacity of the medical services. If the current medical capacity cannot be quickly expanded, the other option is to have more drastic measures to "flatten the curve".

It is a no brainer to expect more stringent measures if the authorities are serious about controlling the pandemic. 

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PS: This blog is for me to better understand COVID 19 as this will impact my investments. If you are also into equities, follow me at i4value.asia

Disclaimer:  I am not an epidemiologist, healthcare worker, pharmacist, or staff in the Ministry of Health, but rather is someone with a strong interest in numerical analysis.  The content is an attempt to understand what is happening in the battle against COVID 19 from a data-based perspective. The opinions expressed here are based on information extracted from readily available public sources but I do not warrant its completeness or accuracy and should not be relied on as such.