2011 General ASX Market Discussion

[Joe Blow]

I never imagined that the "Official 'ASX is Tanking!' panic thread" would have seen so many posts in just a couple of months, so I have decided to start the first monthly general market discussion thread as there is clearly a demand for this type of general market chat.

I will see how this thread goes during October and if it's popular I will start a new thread each month.

So please, chat away everyone!

 

[VSntchr]

Re: October 2011 General ASX Market Discussion

Yet another up day on the cards today. A big move from the recent low on, so far, only a few words out of Europe...
Will be interesting to see where we end the week...

 

[notting]

Re: October 2011 General ASX Market Discussion

Many short term technical buy triggers will go off today. As they would have in global markets last night.
It's back dropped by the cyclical Christmas rally which is rocketing this current move.
We also have the Elliot wave C shaping 'up.'
The US is not going into recession this week as it was last week! and Euroland members are starting to sound coherant with a plan that will manage the banking system if Greece defaults in a month.
Italy had kick but growth last month and China's inflation is under control.
Could the end of the world look any better?

 

[Gundini]

Re: October 2011 General ASX Market Discussion

Yes, I must admit it is pretty frustrating waiting for a base bottom to start forming in Gold and the Dow. No sign of any punters jumping out of the windows just yet. Happy sitting on the sidelines and test my patience, especially during October.

 

[skyQuake]

Re: October 2011 General ASX Market Discussion

Many short term technical buy triggers will go off today.

That means time to fade!

 

[notting]

Re: October 2011 General ASX Market Discussion

Didn't look very faint at the close on the dow with a spike on high volume in a market already well up!

 

[pixel]

Re: October 2011 General ASX Market Discussion

I'm not sure how long the current exuberance will last.
Sure, a lot of buy signals went off; a lot of shorts have been squeezed since the gloomy-looking charts triggered stop-losses everywhere. The question remains "How much has changed?" Can anyone see a reason why there should be such a strong V-shaped recovery?

When I look at this month's Index Option distribution, I'm getting the feeling that today may be "as good as it gets." Unless there are massive changes in the area between 4050 and 4200, the ASX200 could easily drop back below 4100 come the 20th.

 

[Sdajii]

Re: October 2011 General ASX Market Discussion

There was what looked to me to be too much hype, and I sold a lot of my holdings yesterday morning. Turned out to be a bad move as I missed quite a rally (ouch!), but I still think I probably did the right thing (so to speak). This rally seems pretty silly, and the game we've seen over the last few weeks is crazy. We spend a few days, maybe a week or so with everything being roses and optimism and rainbows, then a few days, maybe a week or so, with doom, gloom, we're all about to die, might as well slit your wrist now and get it over with, then start again with the rainbows and sunshine, repeat, repeat...

Nothing is really changing, and on the big picture it looks to me like things are going to get worse before they get better, it's going to hit the fan in the not too distant future, and these strange rallies and spurts of optimism are bizarre. I don't know how much longer people will keep screaming up and down based on the spin, but in the mean time, a few people a making a crazy stack of money, a lot of people are making a lot of money, a heap of people are losing a lot of money, and a fair few (perhaps they're the sane ones and I should join them?) are sitting around watching, scratching their heads.

But don't worry, I'm probably wrong, we've been told they have a plan to make it all okay, they'll be releasing their plan by the end of the month. *phew*

 

[cutz]

Re: October 2011 General ASX Market Discussion

Unless there are massive changes in the area between 4050 and 4200, the ASX200 could easily drop back below 4100 come the 20th.

Nice info Pixel, I guess the liquidation of the excess ITM calls by non market makers will put pressure on the XJO, is that the way you see it ?

BTW is the chart freely available ?

 

[LostMyShirt]

Re: October 2011 General ASX Market Discussion

At the very least we have pulled out of the funk, and the charts indicate to me a run to 4400 or at least near resistence before some sort of consolidation of profit taking. Imo the down-trend is nullified for now.

 

[Chasero]

Re: October 2011 General ASX Market Discussion

Anyone else expecting a pull back either tomorrow or the day after?

4-5 day rallies with no pull back seem a bit strange? Need to review some more charts..

 

[Tysonboss1]

Re: October 2011 General ASX Market Discussion

Anyone else expecting a pull back either tomorrow or the day after?

4-5 day rallies with no pull back seem a bit strange? Need to review some more charts..

I am expecting that it will be entirely unknowable as every other day is. and that any guess people do make will have a 50% chance of being correct.

 

[pixel]

Re: October 2011 General ASX Market Discussion

Nice info Pixel, I guess the liquidation of the excess ITM calls by non market makers will put pressure on the XJO, is that the way you see it ?

Hi cutz,
it's more likely the threat that those ITM calls can be exercised, costing the writers - usually large Institutions - big $$'s. What I therefore find in most months is a late "adjustment" where
either those excess Calls are being bought back, neutralised by Puts, or rolled forward
or the underlying stock - or index in this case - is pushed back down towards the level of equilibrium.

As an example:
The moneypoo-lation was strikingly obvious in last month's TLS trade, where I discovered some 140 Million Calls at $3.10. Of course, the sp closed at $3.09 on the day, meaning the Calls couldn't be exercised, the writers kept stock and premiums, and it was only the next day that TLS rose above $3.10.

 

[young-gun]

Re: October 2011 General ASX Market Discussion

Anyone else expecting a pull back either tomorrow or the day after?

4-5 day rallies with no pull back seem a bit strange? Need to review some more charts..

just wait for the next slightly negative headline out of europe and you will see this rally at least halved in two or three days I have little to no doubt that the big wigs over there have any idea on what to do. Most likely sitting there discussing "so how can we let Europe collapse gently."

Of course they wont. Instead the end result will be "lets print more money". Or Germany will help out and in turn get sucked into the abyss.

 

[pixel]

Re: October 2011 General ASX Market Discussion

Something is likely to happen that can well stretch out into mid-November.

The current equilibrium on Index Options of the November series (exp.17/11) is at 4050.

 

[Wysiwyg]

Re: October 2011 General ASX Market Discussion

According to this chart at the Eureka Report's website, which is scaled in 6 year periods, shows the company earnings to index divergence. One would believe will eventually come back to mean.

 

[joea]

Re: October 2011 General ASX Market Discussion

Hi.
Better still, will the passing of the "carbon tax" tomorrow morning initiate the first step in a final leg down to take out the low of 9/08/2011?
joe

 

[nomore4s]

Re: October 2011 General ASX Market Discussion

Hi.
Better still, will the passing of the "carbon tax" tomorrow morning initiate the first step in a final leg down to take out the low of 9/08/2011?
joe

We won't take out that low without the help of overseas markets imo. My analysis of that low holding till next year is still valid. We've seen everything I wanted to see, a slowing of the decent and a strong rally off support.

I think we will end up back around 4400-4500 maybe even a touch higher in the next few months followed by some sideways action and then a drop, small rally and then possibly a steady decline towards the 3500-3700 area or maybe even 3000-3200 depending on how bad things turn out for the world economy. This is a long range forecast though and it is always hard to be accurate over longer time frames in todays markets.

One thing I'm pretty sure of though is we will see some sort of bear market over the next few years unless the governments manage to actually pull out some real fix to all the problems .

 

[skc]

Re: October 2011 General ASX Market Discussion

We won't take out that low without the help of overseas markets imo. My analysis of that low holding till next year is still valid. We've seen everything I wanted to see, a slowing of the decent and a strong rally off support.

I think we will end up back around 4400-4500 maybe even a touch higher in the next few months followed by some sideways action and then a drop, small rally and then possibly a steady decline towards the 3500-3700 area or maybe even 3000-3200 depending on how bad things turn out for the world economy. This is a long range forecast though and it is always hard to be accurate over longer time frames in todays markets.

One thing I'm pretty sure of though is we will see some sort of bear market over the next few years unless the governments manage to actually pull out some real fix to all the problems .

Looking across global markets, the fall pretty much started at late July at around these levels.

XJO ~4400
SPX ~1250
DAX ~7000
HSI ~21,500

I can see XJO and SPX going to retest those levels without too much problem... they are only 4-5% away anyway.

But I can't for the life of me see DAX and HSI going back towards those levels without some sort of minor miracle.

For DAX there's a resistance zone at ~6000, and for HSI it's ~18,500. These are ~3-4% away and align better with the XJO and SPX.

At current pace we should get there by the end of the week. Interesting times then.

 

[Nonchalant]

Re: October 2011 General ASX Market Discussion

I am expecting that it will be entirely unknowable as every other day is. and that any guess people do make will have a 50% chance of being correct.

Hehe

The most accurate and insightful response in this thread thus far. Well done Tyson!

There really is no rhyme or reason. The market will do what it wants to do.