Bear Market---How will I know I'm in one?

[roofus]

Re: Bear Market---How will I know Im in one?

Dutchie- I see you use the word "punters" in your post do you think share trading is a gamble?

 

[tech/a]

Re: Bear Market---How will I know Im in one?

Punters can be used as a description of any participant in any pass time.
Doesnt necesserily mean the connotation used in the horse racing industry.

Mind you I think most people "Punt" and call it trading.
Very few have any more than a form guide (Fundamental analysis) and a rough Idea of the odds (Fair Value).

 

[dutchie]

Re: Bear Market---How will I know Im in one?

G'day Roofus

Thats a good question that everyone should consider.

1. Glib answer - "Lifes a gamble"
2. Politically correct answer - No - trading is a business
3. Realistic answer - Yes (for the majority of "investors"
-97% ???).
4. My answer - all of the above.
I believe there is a certain amount of luck involved (being at the right place at the right time etc.).
I trade on the assumption that I am making educated (researched) decisions (nearly all "investors" probably believe this irrespective of the quality of their education).

So I have used the word "punter" to mean investor/trader/businessman/mum/dad/kids.

Cheers

 

[Wysiwyg]

Ive never seen it described?

How will I know Im in one BEFORE its over?
How do you define a bear market.
What and when is it different to a correction in a Bull Market.
Is it possible that there is a period of virtually NO Growth?
The market ranges for years.

Im interested in how all of those waiting for the "Inevitable" bear market will know when its upon us?

Searching through old posts i came across this one from 2005.Is this a bear market now?What length of time of decline is the point of definition?
With mega "paper" losses recorded from many financial institutions and some going down it is only a matter of how long before the bootom is hit.

The answer is, you won`t know, but an estimation is as good as any of us (me) plebs can do.If Chinoindia collapsed i would say yes.

ps i remembered the economic clock

 

[Wysiwyg]

The updated comparative bear market graph below shows this one was a sharper decline but "possibly" shorter duration. That being if the low holds. Still bearish bias myself yet hard to believe 6500 will be revisited on the DOW.

 

[Buckeroo]

The updated comparative bear market graph below shows this one was a sharper decline but "possibly" shorter duration. That being if the low holds. Still bearish bias myself yet hard to believe 6500 will be revisited on the DOW.

Take a look at the link below - according to this, you may be overly optimistic at 6500.

In the report, there are a some charts (Dow Jones Industrial Average) with explanations. Would appreciate comment from the charting experts if they concur or not on the potential patterns forming.

Thanks in advance

http://www.financialsense.com/fsu/editorials/mchugh/2009/0802.html

Cheers

 

[moXJO]

This was sent to me back in April this year (was possibly around before that).

Chart 28 shows the most likely scenario currently for the Dow. The first rally got oversold after testing near 7,900 and now should retreat to support levels between 6,870 and 7,260, unless the market surges on Thursday’s FASB ruling on mark to market. In that case we could rally quickly to 8,300 and then set back to 7,260 or lower. Given that the rally was strong and steady on the way up, it is likely to be steady and strong on this correction, and we could see more towards the lower side of this range. Either way, we should have another rally that would test the strongest resistance””the down trend line in tops since the spikes in October that peaked at 9,800 and 9,650 and through the recent broad fourth-wave rally to 9,100. That resistance will hit between 8,100 and 8,300, depending on when we test those downward trend lines. Ultimately since this rally represents a broader Elliott Wave advance than the second- and fourth-wave rallies on the way down, then this rally should last longer””more like 4 to 6 months vs. more like 2 months””and 3,000 to 4,000 points instead of 1,800 to 2,100. We should at least see a bounce back close to the broader fourth-wave highs around 9,100. On the higher side we could see a 50% retracement of the 7,800- point loss on the way down toward 10,400. Given that the
market got so overdone on the way down, it is actually more
likely that the rally will be more persistent and head toward the higher end of the range, between 9,650 and 10,400. We will have to monitor overbought readings as we most likely continue to advance in the months ahead.
The current correction is likely to see support between 6,870 at worst and 7,260 at best. We will look to issue a second buy signal in that range in the coming days or weeks. The more critical resistance between 8,100 and 8,300 is likely to be tested in early or late April. That would represent a shorter-term sell signal for traders and more flexible investors. It is probable on our seasonal cycles in May to see a more substantial and lengthy correction back toward the likely lows in April again between 6,870 and 7,260. We are likely to see multiple advances toward 9,000 to 10,400 into June and July””and possibly into as late as September. Our strongest intermediate cycles both turn downward in late 2009, hence we don’t recommend being in stocks past July to September, depending on overbought readings by then. Oil, commodity, and emerging country stocks may continue to rise into late 2009 or even early to mid-2010 before joining the next global crash. As examples of indices in several areas to be focusing on, oil should be a good buy between $42 and $44, emerging markets at around $23 on the EEM, and China at $26 on the FXI and the financials between $7.20 and $8.00 on the XLF.

 

[Mohammed Hazabig'un]

Re: Bear Market---How will I know Im in one?

Classic Dow Theory was the measure for both bull and Bear markets but in Dow's day the Transport industry in the States was the most powerful iinfluence.Today while powerful I dont know that its the benchmark it once was.

Utilities (or Banks) nowadays?

 

[Mohammed Hazabig'un]

Re: Bear Market---How will I know Im in one?

Does anyone have historical data/knowledge in regard to the statistics of bear markets in Oz.

When were they?

How long did they last?

How much did the market lose (approx.)?

11 months I believe is the average for S&P 500

 

[Mohammed Hazabig'un]

Re:

My point STILL remains how do I/we know when to adopt these stratagies??At what point can we all announce that we are in a bear market??
At what point and with what characteristics will we be able to recognise that this IS it and when its over ----the reverse?? Its now a Bull market---all I believe totally different to a Crash like 87 or 97

Thanks for the thread @tech/a . As one of the best Chartists on this Forum I'm guessing you know the answer, any chance you could share your thoughts please.