Predictions for ASX Opening Tomorrow

[tronic72]

^ You are investing in the US at the moment? Man, big ballz! Not only is their market in worse shape than there, but their dollar aint looking too good either!

Isn't that THE time to be investing in the US Market?

Our Market is still in a very good shape but the honeymoon is almost certainly over. The fact that it will take the US a few years to recover means there are some really good bargains to be had. Just look at Apple & Intel.

I've started looking to the US for Property and Stocks. The more negative sentiments I hear about the US Market, the more keen I am to invest into it. Our market on the other hand, has reached it's highs and although it should get back most, if not all of the recent losses, it doesn't have much to offer than a lot of big expensive, holes in the ground.

 

[Buffettology]

Isn't that THE time to be investing in the US Market?

Depends how long you think this will go for? If their $ keeps falling and you want your money out, you will loose any capital gain you make off your investments there. Perhaps you should hedge your bets.

Not to mention, hate to sound cliche, but its only a matter of time until the "**** hits the fan" over in the US. In a time of inflation and slow growth, drastically cutting rates is something that could see staglation (one of the absolute worse case scenarios for economists) if consumer confidence and sentiment remain down. What will happen to the stockmarket then? How do you stimulate growth without pushing up inflation even more and hence providing "free money" to borrowers?

We also have to see if this banking crisis has been limited to the banking sector (which it probably has in Australia), but with the losses in the US, it HAS to have had to spill over to retail trade. Do you know how much their economy relies on the retail sector? Once these statistics come out, probably over the course of the next year, we will have some big big problems. I think prices may well get a LOT lower in the US still. Of course this will spill over to the rest of the world, but I doubt it will force them into recession as it has done the US. Australia is probably one of the safest markets in this current environment, but that wont stop us from seeing a hit also.

 

[nioka]

It looks as though the market will rise on opening today. All my buy orders left over from Friday are a lot further down the list now than they were at the close on Friday.That is usually a sign. Because I'm trying to buy I am hoping for a reverse during the day but I don't expect it to happen to any extent.
Actually this is a day late. Should have put it in yesterday because it is for today.

 

[wideboythin]

This thread is turning out to be a real education. I am new to the market, a year or so experience and am learning a heap of this thread. I started it for that reason and its proving to be a little gold mine. Thanks to all the contributors and lets try to keep this one alive, I am sure I am not the only one who is learning here.

 

[kingie_d]

XAO formed a white hammer today. Could be an up day for the end of the week?... Couple of other recent hammers preceeded upmoves

 

[Nyden]

Red dye I foresee in the sky tonigh(t), says I :

Time to say goodbye, time for the high to die?

Sorry, that was awful. But, it's been a while since I've expressed my terrible humor!

 

[YELNATS]

Red dye I foresee in the sky tonigh(t), says I :

Time to say goodbye, time for the high to die?

Sorry, that was awful. But, it's been a while since I've expressed my terrible humor!

Nyden, I always enjoy your humour and optimistic outpourings, terrible or otherwise. Keep them going!

 

[Buffettology]

I think with this rate cut, it will move up with some kind of optimism. Then the doubt will start to creep back in, and we may see a DRAMATIC fall! Afterall, the Fed doesnt meet until March and the RBA may rase rates at home! All of which could fuel and encourage another long string of down days!

Glad to say, I want a crash now, I finally got most of my $$$ back out of the market.

 

[tronic72]

I think with this rate cut, it will move up with some kind of optimism. Then the doubt will start to creep back in, and we may see a DRAMATIC fall! Afterall, the Fed doesnt meet until March and the RBA may rase rates at home! All of which could fuel and encourage another long string of down days!

Glad to say, I want a crash now, I finally got most of my $$$ back out of the market.

Think that's wishful thinking because you have "Cash to Splash". I think we've nearly seen all the carnage surface from the Sub-Prim issue and the market has already factored it into current prices.

Remember we are currently lower than at any time last year! (pretty close).

It will be really interesting to see what sort of results the financial companies such as the banks, AFG, MQG & BNB produce. If they produce positive figures we could easily see a lot of the doom and gloom disappear.

After the recent crash I'm much more positive than I was at the end of last year.

My reasons are as follows:
1. Recent report says Chinas growth will make up for any shortfall in the US
2. We've finally had rain. Wheat and other soft commodities are going through the roof because the north is using all their corn, wheat etc for Biofuel.
3. the XAO is sitting very very low close to this time last year which leaves more possibility for upside.
4. Australia's exposure to sub-prime risk has been said to be very small (company reports will prove or disprove this soon).
5. Most analysts say a US recession will be "mild" and "short in duration, between 6 & 12 months".
6. Australia is ticking along quite well, thanks very much and with our high dollar we are making even more money from the items we sell.

 

[Buffettology]

Tronic,

The US just released very poor economic growth figures. With the lags, the next quarters are sure to be worse. Inflation looks set to spike as it has done here and staglfation would be a HUGE problem for them.

I hear from the inside that the banks are doing worse than expected (maybe my source is wrong, but he lives amongst the elite in Sydney and says the problem is worse than expected), guess we will see, he has been known to tell a tall tale once in a while. But no doubt he is connected with most of Sydneys top bankers and traders.

Australia is ticking along quiet well, but inflation is WELL out of the target rate of 2-3%, which almost certainly, according to past trends, means the RBA will raise rates. How much impact will this have on a market in the middle of a turn to negative sentiment? Im not sure, but it all points to at least a quick, sharp, correction.

As far as wishful thinking, I only got the majority of my cash out in the last two days, I could have wishfully thought the market would bounce back to previous highs and kept it in there if thats what I beleived

But there are also definately reasons for some stable growth, its just in that balancing act now, where nobody knows what to expect, hence why I am out.

 

[Random Walk]

I think tomorrow the XAO will be sold off heavily in the morning and close a little in the red, continuing the pattern we've seen over the past few days, swinging around as the bulls / bears fight it out…

However, in the medium term, I feel the general direction is down; we’re waiting for some negative news and an excuse to bail.

Looking for opportunities to exit my few remaining long positions (but have trouble letting go; they're too special).

 

[Buffettology]

My reasons are as follows:
1. Recent report says Chinas growth will make up for any shortfall in the US

What report says this?

China has a LONG way to grow before it becomes the size of the US economy.

NO way can Chinas growth in the shorr term make up for any shortfall in the US.

Also, there is now talk that Japan is back in recession, if this is true, it cannot be a good thing since we do a lot of trade with Japan.

Just too risky business for me at the moment. I will sit this one out for a while.

Has the market already factored in a US recession, or if these figures ARE actually released and sentiment already poor, could a quick panic occur before the big funds come in and buy up on the cheap?

 

[overule]

BHP going to shine tomorrow but i am not that positive about banks.

What do you guys think ?

 

[kpas]

Tronic,

The US just released very poor economic growth figures. With the lags, the next quarters are sure to be worse. Inflation looks set to spike as it has done here and staglfation would be a HUGE problem for them.

I hear from the inside that the banks are doing worse than expected (maybe my source is wrong, but he lives amongst the elite in Sydney and says the problem is worse than expected), guess we will see, he has been known to tell a tall tale once in a while. But no doubt he is connected with most of Sydneys top bankers and traders.

Australia is ticking along quiet well, but inflation is WELL out of the target rate of 2-3%, which almost certainly, according to past trends, means the RBA will raise rates. How much impact will this have on a market in the middle of a turn to negative sentiment? Im not sure, but it all points to at least a quick, sharp, correction.

As far as wishful thinking, I only got the majority of my cash out in the last two days, I could have wishfully thought the market would bounce back to previous highs and kept it in there if thats what I beleived

But there are also definately reasons for some stable growth, its just in that balancing act now, where nobody knows what to expect, hence why I am out.

I too think we have yet to see the worse drop in XAO - the US Fed can only drop their interest rates so far before they are at nothing.

They are already at 3%, honestly how much further can they drop it?

I can understand why australians in particular get frustrated at the market in it's current condition, but if you take into account just how bad the US economy is - I think we will be in for another significant drop.

I am confident that the Australian economy is strong enough that we'll weather it out eventually, just I think we'll drop significantly in the meantime before it settles down.

 

[nioka]

They are already at 3%, honestly how much further can they drop it?.

Easy answer. 3%. I'm not being facetious, Japan was at 0% for quite awhile wasn't it?. They didn't fold. Is that why they needed whale meat? ( now I am being facetious). That would be .25% a month for the next year. Now that would throw the cat amoung the pigeons.

 

[Buster]

G'day KPAS,

I too think we have yet to see the worse drop in XAO - the US Fed can only drop their interest rates so far before they are at nothing.

Personally, I think we saw a huge over reaction, caused by the 'French Bank' unwinding their positions coupled with the uncertainty about the US economy that was already hanging low in the minds of traders/investors etc.. add to that some big (Global Fundies..) players shorting for market manipulation that squeezed the (astounding number of) more leveraged 'Margin' traders/investors out.. The result equalled panic selling into a freefall market

Yes there will be some volatility over the next few weeks, but I think once the company reports start rolling out all will be appeased.. Have yet to see any nasty news from US companies (besides the bad loan writedowns of banks, they still seem to be posting profits however..) Most companies so far are meeting or are just slightly less than expectations..

Yes, there is the issue of the insurers that is the 'doom and gloom' flavour of the week, however I think that the Banks have a vested interest in seeing that they remain solvent also..

They are already at 3%, honestly how much further can they drop it?

I'm tipping they'll end up at 2% - 2.5%.. a couple of days ago I'd have said definitely 2%, but the FED may take heart in the market gyrations of the past week..

I think Tomorrow will be a good day for our market.. after that, anyones guess..

Having said that, that's purely speculation on my part, my .. I'm simply a mug.. have no real experience to speak of.. unless losing cash in the '87 crash counts..

Regards,

Buster

 

[Buffettology]

Wait for the US inflation figures over the coming year.

Thats when we will see just how bad problem they are in!

 

[Uncle Festivus]

1. Recent report says Chinas growth will make up for any shortfall in the US

Sorry Tronic, new data not positive in the short term -

The January Procurement Manager Index (PMI) published on Feb. 2 by China Federation of Logistics and Purchasing (CFLP) stands at 53.0 percent, 2.3 percentage points lower than previous month. And among all sub-indices, the one for export orders for the first time over the past three years decreased.

5. Most analysts say a US recession will be "mild" and "short in duration, between 6 & 12 months"..

Are these the same analysts who said sub prime was 'contained'?

6. Australia is ticking along quite well, thanks very much and with our high dollar we are making even more money from the items we sell.

Other way around I think - exporters getting hammered the higher it goes?

Yes, up day tomorrow most likely, another oportunity to lighten the portfolio.

 

[Buffettology]

Other way around I think - exporters getting hammered the higher it goes?

Yes, up day tomorrow most likely, another oportunity to lighten the portfolio.

I agree, exporters getting hammered, but it will help curb imported inflation.

I have just lightened another 10% of my portfolio. Holding a WAD of cash now!

Uncle, you have been very bearish for a long long time now, does this mean you are just sitting on the sidelines, or are you trading derivatives and shorting stocks?

 

[Uncle Festivus]

I agree, exporters getting hammered, but it will help curb imported inflation.

I have just lightened another 10% of my portfolio. Holding a WAD of cash now!

Uncle, you have been very bearish for a long long time now, does this mean you are just sitting on the sidelines, or are you trading derivatives and shorting stocks?

Hello Buff,

In my view the secular trend has turned over to negative, with the ticker action like today showing how fickle it is. XJO got to 6022 then we got the now customary sell into the strength fade. The market is shot, but it is great swing trading, I have been long a quit a few times (CBA great day trade, look at the range!! 5250 to 4950!!) after the 'route'. But, sitting in 20% cash, the rest in local gold stocks. Working so far, the portfolio is sitting on 18% return for Jan so far . Ex div season coming up so selective day trading now. 7% cash is looking good these days while we ponder the irrationality?