How low can the All Ords go?

[rederob]

That is the sort of information that could only come from the "Lemming Daily News". That will give us great buying oportunities on the way down if many lemmings follow that advice.

You can always offer your own view of direction and quantum rather than make disingenuous comment.
Please note I am not giving advice, as you infer. I am offering my view of how I see things and why.
If I was giving advice it would be along the lines of get out now, and stay out until the market has actually showed signs of sustained recovery. And then it would be to buy as the market was going up, not down as you have assumed.

r34ztune
I have posted at this site for several years, and have not been backward in making some "way out" forecasts in that time. They remain available at this site for anyone to throw bricks back at me. In fact, I specifically came onto this site to stir the pot in the "gold" thread over 2 years ago. At the time I had moderators and posters insisting I tone down my posts.
Last November in the "oil" thread I forecast an average price of $120 for 2008, and suggested it might be conservative. There's another 6 months to run on that one, but so far, so good.
If you want to challenge my capacity for analysis, please do so directly on this forum so that I can reply to you in a considered way.

 

[Crafty]

I seriously doubt BHP would get to that level or even a PE of 9.

BHP was on a PE of about 8 early last year...

 

[Wysiwyg]

Things are starting to get silly now.Petrified fear selling at large losses, dump buttons locked and loaded, domino effect accelerating.Not long to wait now in my opinion but no doubt the market will stay irrational just because it can.




.

 

[korrupt_1]

when there are no more sellers in the system... then the market can come back up....

as some here have mentioned before... the strength of sellers on the Australian Market is a force to be reckoned with.... absolutely no hesitation to dump the markets,... sell with extreme prejudice and don't care what how anyone feels about.

 

[explod]

I have posted at this site for several years, and have not been backward in making some "way out" forecasts in that time. They remain available at this site for anyone to throw bricks back at me. In fact, I specifically came onto this site to stir the pot in the "gold" thread over 2 years ago. At the time I had moderators and posters insisting I tone down my posts.
Last November in the "oil" thread I forecast an average price of $120 for 2008, and suggested it might be conservative. There's another 6 months to run on that one, but so far, so good.
If you want to challenge my capacity for analysis, please do so directly on this forum so that I can reply to you in a considered way.

There are those who have a view and those who follow others. As part of the former your word is very much valued Red.

Our market is tied to the fear and sentiment of Wall Street. I pointed out with analysis some time back that I thought the Dow would go below 4,000 in the next year. The All Ords will follow it all the way.

 

[brty]

Are we having capitulation right now??? All ords down over 100.

Fear in the air.

brty

 

[Snakey]

Are we having capitulation right now??? All ords down over 100.

Fear in the air.

brty

Still got a while to go yet
Check out these graphs
I would say fear brty not capitulation yet!

 

[Beej]

Still got a while to go yet
Check out these graphs
I would say fear brty not capitulation yet!

Shouldn't you be using a logarithmic (not linear) value/price scale on the XAO chart?? Otherwise your mean projects ever diminishing future returns....

Beej

Oh and PS - If I look at an AllOrds chart from 94 to present, with a logarithmic price axis, the mean trend would appear to take us to fair value around 5000 (don't know how to post it here but easy to get the chart from yahoo finance and look).

 

[Aurum]

Oh and PS - If I look at an AllOrds chart from 94 to present, with a logarithmic price axis, the mean trend would appear to take us to fair value around 5000 (don't know how to post it here but easy to get the chart from yahoo finance and look).

I just had a quick look and would put it a little lower by about 200 points.

Aurum.
P.S. doesn't that 87 crash look scary.

 

[IFocus]

Are we having capitulation right now??? All ords down over 100.

Fear in the air.

brty

No Brty not yet no volume, sellers still to get with the program and feel the fear so maybe a way to go yet.

Still, an amazing straight line move down maybe a bounce soon around 4800.......todays bar quite telling.

 

[pepperoni]

Still got a while to go yet
Check out these graphs
I would say fear brty not capitulation yet!

Ha ha ... I saw that similarity today too.

Seriously though, going back to apr 03 and projecting a sensible longer term growth rate I can see XJO getting to 4500.

 

[Seneca60BC]

Still got a while to go yet
Check out these graphs
I would say fear brty not capitulation yet!

WOW the similarities on those graphs are extraordinary!

 

[Aurum]

So, does no one agree that looking at a long term linear chart is just folly and only logarithmic charts give a true picture? Just curious.

Aurum.

 

[brty]

Interesting graph Snakey,

It looks a lot like what happened between '82 and after the crash in '87. During that market, the all ords shot up from 450'ish to 2312 over 5 years. The fear, capitulation, despair phase took 3 months. From the top, the correction was 50%, but after a run up of 500%.

Currently, we have had a runup of ~230% over 4.75 years, yet the selloff of 28% has taken 8 months. You can read anything you like into charts, and always find something that looks 'similar', however they rarely conclude the same way.

I am currently looking for opportunities amongst large "solid" companies to invest, because if the worst were to happen, my money is safer there than in bank deposits.
Realistically and statistically, we are much closer to the bottom than many think. There is simply too much gloom and doom out there.

brty

 

[Snakey]

Interesting graph Snakey,

It looks a lot like what happened between '82 and after the crash in '87. During that market, the all ords shot up from 450'ish to 2312 over 5 years. The fear, capitulation, despair phase took 3 months. From the top, the correction was 50%, but after a run up of 500%.

Currently, we have had a runup of ~230% over 4.75 years, yet the selloff of 28% has taken 8 months. You can read anything you like into charts, and always find something that looks 'similar', however they rarely conclude the same way.

I am currently looking for opportunities amongst large "solid" companies to invest, because if the worst were to happen, my money is safer there than in bank deposits.
Realistically and statistically, we are much closer to the bottom than many think. There is simply too much gloom and doom out there.

brty

yeah i dont believe that it will follow the same track as the EXAMPLE but I will stick with my bottom pick of around 4200 remember you must allow for the despair factor. then a bounce back to 5000 before settling at 4800

 

[Wysiwyg]

After a quiet period this forum has had old nicks return and new nicks joined.Maybe some confidence returning to the market.A 300 + on the dow might draw some attention though so we`ll see how much credibility there is to it all.

 

[Muschu]

Just thinking out loud.....
If the reporting season in the USA is pretty much over, and if the DOW is to continue its downward spiral, what will be the major causative factors behind further drops, particularly in the short term?
Historical patterns?
Fear / sentiment?
Other?

 

[Sean K]

After a quiet period this forum has had old nicks return and new nicks joined.Maybe some confidence returning to the market.A 300 + on the dow might draw some attention though so we`ll see how much credibility there is to it all.

Interesting perception Wys.

I'm looking to total dispair/capitulation on volume as sign that the worst is factored in.

There will be a time soon with those who have keep some in reserve, or at least a pot of gold to margin off, will do very well in the years to come.

I don't think we are there yet, but it's probably not too far off in the grand scheme of things.

 

[wayneL]

Interesting perception Wys.

I'm looking to total dispair/capitulation on volume as sign that the worst is factored in.

There will be a time soon with those who have keep some in reserve, or at least a pot of gold to margin off, will do very well in the years to come.

I don't think we are there yet, but it's probably not too far off in the grand scheme of things.

Well we haven't had a capitulation low, and this last low wasn't even a particularly volatile low, as lows go. I don't know whether that's bullish or bearish, but we've certainly had "a low".

Ergo, all doom mongering is suspended until a new low appears.

 

[MRC & Co]

Just thinking out loud.....
If the reporting season in the USA is pretty much over, and if the DOW is to continue its downward spiral, what will be the major causative factors behind further drops, particularly in the short term?
Historical patterns?
Fear / sentiment?
Other?

Hey Rick,

Sentiment. Which includes fear/greed and is seen within historical patterns.

I don't think we need a capitulation low (and probably won't see one the way the market has been behaving lately), though these usually form pipe bottoms which are a highly probable reversal pattern.