How Far Will The Market Fall?

[Logique]

This is what the great technician has to contribute? Don't strain yourself tech/a. People out there losing money

So tech/a, is CBA a Buy, Hold or Sell ..LT monthly

 

[Garpal Gumnut]

What's really hard to believe is that it's been a one way move since the end of February. Where are the rallies or counter-trends ?
I would like to look at the other crashes and bear markets all the way back to the start of the century but not on a static graph but on one where you can scroll along. Is there any resource online to do that? Even if it's a line graph ?
Google graphs and other sites I looked at only goes back about 40years max. Current crash looks so steep, somewhat like the 1987 flash crash. I would like to go all the way back to 1929 crash and earlier. Is there an online resource for historical charts up to modern day ?

I remember seeing charts from that era either on some of the Elliot wave sites or Wyckoff sites.

Try googling E..W.. Charts or W.. Charts and dig down into the results.

You will not find an interactive one.

gg

 

[InsvestoBoy]

What's really hard to believe is that it's been a one way move since the end of February. Where are the rallies or counter-trends ?

I would like to look at the other crashes and bear markets all the way back to the start of the century

I saw a chart of this on twitter somewhere recently, comparing the different drawdowns in SPX or Dow. This one is definitely pretty fast.

Welcome to 2020.

 

[MrChow]

1929:
-45% in 11 weeks.

(Only need a further -15% in 7 weeks to achieve that in 2020)

 

[MrChow]

XAO -31.2%
S&P Futures -30.4%

If we have these economic restrictions at 6 deaths in 3 weeks how are they going to be lifted before the end of Winter? Surely in the coldest months of July / August the rate will be higher than 2 flu deaths a week and that's 5 months away still.

Can't imagine the AFL and NRL playing in 5 degrees with a deadly flu around even if it's past its peak. Then extend that to crowds gathering at 5 degrees at night in restaurants and bars and shops after a thousand deaths in previous months it sounds riskier than now.

But how do they wait until September for things to get warmer? It might not be viable.

 

[Smurf1976]

I thing a point being overlooked here is that this is not primarily a financial market event. It is not a redistribution of wealth but a destruction of it.

It is not comparable to the boss versus the workers arguing over pay, a situation where whatever one side loses the other gains.

It is not comparable to one person selling their shares right at the top to some other person who bought them. One loser, one winner but it's a zero sum game.

What we have here is outright destruction. Borders are shut, planes are sitting on the ground going nowhere, all sorts of businesses are shutting down or have a profound lack of customers and so on. That's not a transfer of wealth from one person to another, it's an outright loss as the economy ceases production.

There's unlikely to be a V-shaped recovery for that reason. It's not simply that the airlines aren't flying and there'll be pent up demand when they resume. Rather, it's a case that the airlines aren't flying, those who would fly are losing their current and/or future income, and there's going to be a lot of fear for quite some time to come. Much the same in every other industry - it's destruction far more than it's redistribution.

Particularly troublesome will be if it comes to the point that not only is production not happening but the means of production is lost. Think in terms of airlines going bankrupt, oil wells shut and their owners bankrupt and so on. To the extent that occurs, even a U-shaped recovery becomes more drawn out if it's no longer a case of climbing back up the ladder but of having to first build a new ladder in order to do so.

The fall is incredibly rapid but the whole thing is going to play out over an extremely long time that's almost certain. Pick any democracy anywhere in the world - the next election is going to be about putting people back to work and keeping a roof over their head and food on the table in the meantime.

As for the market - well I won't try and pick bottoms other than saying we're due for a bounce but there's going to be a lot more bad news once the true scale of infection and unemployment is reflected in bona fide statistics. So a bounce then down is my guess.

 

[MrChow]

At 3am:

U.S -30.0%
Aus -29.1%

Seems like we're waiting for stuff to happen before setting off for the next decile.

My prediction is we'll top out at -39% at outbreak / quarantine peak in the U.S.

Sharp recovery of +25% where Trump declares victory and maybe even reelected if timing is good.

But think there's a strong possibility that'll be just the first act - high risk of secondary flu season wave and bankruptcies to elongate the bottom timeline into 2021.

 

[frugal.rock]

Dead cat bounce

The cat is bouncing, but it ain't dead.
Can't you tell?
It's the wriggliest dead cat I ever seen, if so...

 

[bluekelah]

At 3am:

U.S -30.0%
Aus -29.1%

Seems like we're waiting for stuff to happen before setting off for the next decile.

My prediction is we'll top out at -39% at outbreak / quarantine peak in the U.S.

Sharp recovery of +25% where Trump declares victory and maybe even reelected if timing is good.

But think there's a strong possibility that'll be just the first act - high risk of secondary flu season wave and bankruptcies to elongate the bottom timeline into 2021.

We still have populous nations in south America, India and African subcontinents that havent had a peak in the virus yet. Likely more carnage when they do.

Plus currency crisis from all the money printing hasnt even started. Not to mention a credit crisis in USA or China

 

[MrChow]

SP500 makes a new low at 2351.

Key level if you look at the chart.

Also oil is $22 lowest price in 17 years.

 

[Smurf1976]

The cat is bouncing, but it ain't dead.
Can't you tell?
It's the wriggliest dead cat I ever seen, if so...

Cat is using a special contraption to determine the direction of the market:



Conclusion thus far is that it's worth at least $1.

 

[MrChow]

Sleeping until -50%

 

[aus_trader]

I saw a chart of this on twitter somewhere recently, comparing the different drawdowns in SPX or Dow. This one is definitely pretty fast.

Welcome to 2020.

Wow, shocking similarity to 1929 crash so far...

 

[aus_trader]

SP500 makes a new low at 2351.

Key level if you look at the chart.

Also oil is $22 lowest price in 17 years.

OMG, this is really bad news for US shale Oil producers !



Their production cost is way higher than US$22 bucks a barrel. I read somewhere that Trump may support the shale producers to stay afloat with either lower taxes (or no taxes) or rescue packages or Tariffs on Oil imports etc. But how long can he save them for?

We've seen all the taxpayer money wasted on the Auto manufacturing industry in Australia, trying to keep that afloat while it was bleeding money and eventually met it's fate.

 

[qldfrog]

Sit down, put your arms around your knees, lean well forward and kiss something goodby.

You remember the kind of welcome Turnbull got with its entrepreneur push, from both the left: entrepreneurial means no union, small agile business, capitalism at itsbest so bad for labour...
And a similar reception from the right....as big business do not want future competition and liked the status quo....
I have hammered this for more than a decade on ASF, but look at Chile and Argentina, this is our sad and lame future

 

[tech/a]

So tech/a, is CBA a Buy, Hold or Sell ..LT monthly
View attachment 101446

Don’t think anything is a buy until this pandemic is under control
By vaccine or cure.
Removal of restrictions.

until then short indexes

 

[aus_trader]

You remember the kind of welcome Turnbull got with its entrepreneur push, from both the left: entrepreneurial means no union, small agile business, capitalism at itsbest so bad for labour...
And a similar reception from the right....as big business do not want future competition and liked the status quo....
I have hammered this for more than a decade on ASF, but look at Chile and Argentina, this is our sad and lame future

I think you are right and I think we've been pampered and over stimulated and people have come to expect it.
I kind of like the tough medicine being delivered although it's a bit hard to swallow for a spoilt society. Only problem is every candidate is after the votes so will do anything to get it from handing out stimulus, cut rates to nothing, insulation schemes, solar schemes, giving baby bonuses to parenting leave etc. Unfortunately we don't have anyone like the Iron Lady Margaret Thatcher to administer the tough medicine.

 

[Dona Ferentes]

it took until 1931 for Andrew Mellon to write these words for President Hoover

"Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate. It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people.”

- not a happy time.

 

[tech/a]

Giving people $750 is just plain stupid.

Put all that money into test kits and Vaccine/cure development.
-----------Short sighted.
There is no way you'll stimulate an economy that has the
restrictions and job losses both now and pending due to
this pandemic.

In my view the quickest way to stimulate it is to direct
everything into finding a cure/vaccine/increased Testing
and social isolation until this happens. Throwing money at
it is like throwing toilet paper on a fire.

Achieves NOTHING.
Other than a false sense of "We are not being forgotten"
from the masses who will just buy $750 of Dunny roll.

 

[InsvestoBoy]

XAO -31.2%
S&P Futures -30.4%

You keep posting these % fall comparison numbers but they are completely invalid comparing apples and oranges.

Firstly, the sector composition is quite different and secondly they are priced in two different currencies!

FWIW the XJO is down ~30%, the SPX priced in AUD is only down ~20%.