Australian (ASX) Stock Market Forum

The official "ASX is tanking!" panic thread

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XJO 200 day sma at 5,847 and 61.8% fib retracement at 5,838.
Bit of confluence down here if we can get a close above these levels.

Fair chance to get some mean reversion from these levels.
 
Magellan boss - Hamish Douglass agrees with -

notting said:
Stocks aren't yielding that well at these levels and so much credit fueled cheap buy backs have taken place, this could make for an aggressive reversal especially if inflation kicks in from the new player - 'tax cuts.'
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To paraphrase him - 'The tax cuts are like pouring fuel on the fire.'

Right after unprecedented support and central bank stimulation in the market for 10 years which has lead to these very high asset prices.
If the US economy starts to gather inflationary steam the tax cuts will fuel it and the bond market is reacting and will react quickly. The central banks will be behind the curve and have to raise rates quickly. That inflationary effect is going to be hard to get in front of. Not forgetting all the funds being repatriated back into the states too!
We are in uncharted waters with respect to the possibility of an inflation bomb boooom!
 
This inflationary effect is exactly what the macro tourist warned about several months ago on his blog....
 
  • "The average bull market 'correction' is 13 percent over four months and takes just four months to recover," Goldman Sachs Chief Global Equity Strategist Peter Oppenheimer said in a Jan. 29 report.
  • But the pain lasts for 22 months on average if the S&P falls at least 20 percent from its record high — past 2,298 — into bear market territory, the report said. The average decline is 30 percent for bear markets.
  • The last week of stock market drops has taken the S&P 500 into correction territory for the first time in two years.
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PS Does anyone know what those black things are that those guys are holding against their heads?
Are they like comfort teddies or what?
 
https://www.cnbc.com/video/2018/01/04/ralph-acampora-heres-why-im-so-bullish.html

It's the blind side of technical traders and I love it!
Although he was saying this on Thu, 4 Jan 2018 which was pretty impressive given the s&p did 7% in just over a month from that! Annualised that would be 84% for the year!
One thing that does stand out however is XOM wait for oil sentiment and technicals to look like it's going to turn back up, when ever that will be (71ish)
 
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lenny said:
The chartist calling the XJO down to 5000 tonight.
I didn't like the close below the 200 day today.
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I saw that tweeted earlier too, however the Chartist weekly newsletter went on to talk about how large short term declines are followed by above average market performance in the following 12 months.

Quarterly chart below for a muuuuch longer term perspective, higher highs and lower lows still being made in the XAO. Some people calling for a GFC2 already??

xao.png
 
sptrawler said:
WOW all scary stuff, lucky I bought in in 2007 at 6750, still holding hope this correction isn't going to hurt.:roflmao:
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If you owned the local McDonald’s franchise, and had manager running it for you, would you be looking at the daily, weekly or yearly prices that franchises are trading at?

Or would you be more concerned with the quarterly profits generated that your family are living off?

I think you wouldn’t really care so much about the price of stores, you would just bank your profits and live life.

Owning the index is exactly the same, even if you bought the index right at the peak, if you just held and lived if dividends you have done a lot better than a cash investment.

No need to stress, just live if the steady flow of dividends/ business profits your investments are making.

Focusing to much on share price movements cause people to make silly decisions, and lose out.
 
Kryzz said:
I saw that tweeted earlier too, however the Chartist weekly newsletter went on to talk about how large short term declines are followed by above average market performance in the following 12 months.

Quarterly chart below for a muuuuch longer term perspective, higher highs and lower lows still being made in the XAO. Some people calling for a GFC2 already??

View attachment 86228
Click to expand...
Yes I tend to believe this is correction after the tax reform and U.S. market strong surge higher.
 
lenny said:
The chartist calling the XJO down to 5000 tonight.
I didn't like the close below the 200 day today.
Click to expand...

I believe the 200 day moving average is almost irrelevant used on our markets. Much more significant on U.S markets...to a large extent a self-fulfilling prophecy.

The Chartist also said an excellent buying opportunity around 5000. A multi-year trend higher likely from there.
 
Quick corrections tend to have quick recoveries.
That was quick! (The time it took to take out 10% from the top)
Traditionally a correction takes 3 to 4 months to play out.

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