How Far Will The Market Fall?

[mikejosef]

4800-4900 ok
4000-4100 good
3200-3300 bargain
<2800 ??? personal debt/credit crisis/ bail in-out/super stimulus printing press

If your cashed up get ready

View attachment 101389

what a depressing chart.

I find it very hard to read what will happen next, but considering the panic over the weekend, i predict the market will stop falling the day Aus daily death rates start falling, which i think is 2 weeks away if im reading Scomo's flattened curve.

 

[satanoperca]

Try under 4000 within 4-6 weeks. Got to love panic

 

[gartley]

My 2c worth for a longer term EW count.....

 

[satanoperca]

Wow Gartley, a little more than I was thinking, which was somewhere around 3200.

 

[moXJO]

Try under 4000 within 4-6 weeks. Got to love panic

"Panic" is the key word.
And people are following it to the script out there.

 

[OmegaTrader]

what a depressing chart.

I find it very hard to read what will happen next, but considering the panic over the weekend, i predict the market will stop falling the day Aus daily death rates start falling, which i think is 2 weeks away if im reading Scomo's flattened curve.

How many Australians have died so far? This has nothing to do with death rates. Playing the man not the game.

You don't need toilet paper when your dead.

2800 wow a big panic for that.

 

[gartley]

Wow Gartley, a little more than I was thinking, which was somewhere around 3200.

Most likely we will both be wrong, it's like the lottery trying to bottom pick.. Only expected 5600 in Bill's prediction game so already got it wrong once!!
What's more important will be the structure of the pattern as it unfolds in the next few years.

 

[J1eyed]

We are about to get the most substantial demand collapse the world has ever seen. This is no longer about the virus and is about whether the central banks can save the financial system. Over the last ten years, corporates have gone a massive debt binge and invested in share buybacks (not productive assets). Right now liquidity has disappeared from the corporate bond market. When no one knows which loans are going to go bad, all are assumed to go bad. This is going to take months and months to clear up. All the while the taxpayer is going to be the proud owner of zombie companies. Basically we are all turning Japanese.

If the central banks can save the corporate debt market, then it's the GFC, if they can't its 1929.

 

[satanoperca]

"If the central banks can save the corporate debt market, then it's the GFC, if they can't its 1929."
95% chance we are 1929 then.
The central banks have nothing left, zip , zero,0, they have run their course, their theories have failed.

 

[gartley]

Currently:

XAO -30.6%
S&P500 -20.1%

Looks like another big Monday night over there.

Capitulation of ASX relative to US indices not surprising given the struggling advance we had since GFC low, not to mention the state of our dollar!!
Still I see DAX is 38% off it's ATH so we are not the worst

 

[Smurf1976]

What we're seeing is a progressive collapse of expectations.

Take this thread for example. It started less than a week ago and the first posts are talking about 20% decline from the peak and so on. Now we're talking about drastically more than that, indeed real world reality has already blown through the earlier thoughts.

That basic pattern is being seen across everything at the moment. Whatever was thought a week ago, the thinking is far worse now.

We'll be somewhere near the bottom when that stops being the case. When expectations stop being revised downward or even simply stop being issued in the first place because just about everyone's given up.

We're not at that point yet.....

 

[aus_trader]

Both. Especially, since the ranges are so big at the moment. Like to look at longer term charts too because they offer a good perpective especially in suggesting when trends are at risk. Another example is the Nasdaq Composite chart attached which was scoffed at by the bulls a few months ago

I see, nice charts by the way

 

[aus_trader]

We're not at that point yet.....

Don't forget to post a shout out when we are there or close enough

 

[Smurf1976]

Don't forget to post a shout out when we are there or close enough

That's the bit I'm not so good at.

Knowing when we're there that is. I can do the shouting though.....

Seriously, everything I've seen from charts others have posted here through to looking at previous crashes is all much the same in that to be near the bottom now would require this to be dramatically faster and straighter from top to bottom than any previous decline. Possible but I doubt it.

 

[gartley]

Given the theme of this thread have decided to look at 5 big panics in history all of which had very high momentum initial moves before starting counter trend rallies. The 87 crash ofcourse was over within a few days but had a re test of the lows months later. All the others continued bearishly after a "hopes re kindled " rally. I have measured the excusion of price from a nominal level ( a centered weighted moving average). So how much lower before a sustained countertrend? If history is any guide we are getting close. Perhaps only up 3-4 % lower to go. Presently 20.03% below the nominal and the SPX during the crash of 29 (the highest of the I looked at) went 23.7% below nominal.

 

[bluekelah]

Given we hit 3500 in 2009, I would expect things to bottom out to similar levels this time round or slightly lower. After all we have to factor in some inflation.

My prediction is European recession/crisis + USA crisis.recession from virus -> china and asia recession due to collapse of export markets - > australia will have a very severe recession from COVID19 and Chinese recession.

Its gonna be U shape recovery best case and worse case an ongoing 10year depression/stagflation type thing...

 

[aus_trader]

Given the theme of this thread have decided to look at 5 big panics in history all of which had very high momentum initial moves before starting counter trend rallies. The 87 crash ofcourse was over within a few days but had a re test of the lows months later. All the others continued bearishly after a "hopes re kindled " rally. I have measured the excusion of price from a nominal level ( a centered weighted moving average). So how much lower before a sustained countertrend? If history is any guide we are getting close. Perhaps only up 3-4 % lower to go. Presently 20.03% below the nominal and the SPX during the crash of 29 (the highest of the I looked at) went 23.7% below nominal.

Very interesting charts, thanks. I'd like to think optimistically as well and say we must be at or near the bottom.

Only worry is the China involvement this time. With GFC, we had an approx. 50% decline in the markets despite everyone (not me, I got haemorrhoids) cheering and high fiving how China saved Australia from a recession and things went on as nothing has happened.

australia will have a very severe recession from COVID19 and Chinese recession.

Yeah, I have the same worry because our economy is so reliant (due to mineral exports and consumer goods imports) on China.

So all in all, I think it's probably too early to say there's nothing further to worry about...

 

[moXJO]

Stocks were still looking expensive. Let's see after today. There are a lot of trash stocks out there

 

[lusk]

Given the theme of this thread have decided to look at 5 big panics in history all of which had very high momentum initial moves before starting counter trend rallies. The 87 crash ofcourse was over within a few days but had a re test of the lows months later. All the others continued bearishly after a "hopes re kindled " rally. I have measured the excusion of price from a nominal level ( a centered weighted moving average). So how much lower before a sustained countertrend? If history is any guide we are getting close. Perhaps only up 3-4 % lower to go. Presently 20.03% below the nominal and the SPX during the crash of 29 (the highest of the I looked at) went 23.7% below nominal.

This ones really unique, 2020 was from a high. All the others had some form of roll over/lower high before the descent. If you trade without stops you would have got hammered/trapped, either until you couldn't handle it anymore and sold or just decided no point selling now.

 

[Knobby22]

This ones really unique, 2020 was from a high. All the others had some form of roll over/lower high before the descent. If you trade without stops you would have got hammered/trapped, either until you couldn't handle it anymore and sold or just decided no point selling now.

Yes, we are in new territory.
In many ways this is worse than those previous falls, massive disruption of all levels of society and commerce.
On the other hand, it will end quicker once the virus has passed however not without major damage.
No one really knows how low it will go or how long it will last. The market commentators are as clueless as the economists.