Australian (ASX) Stock Market Forum

The official "ASX is tanking!" panic thread

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ferretbiter said:
The only thing I believe that has changed is that those who are panic sellers have panicked and sold (like myself) so hopefully if there is a drop it won't be quite as magnificent.
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Panic sellers? Or people sensible enough to have stop losses in place?

So you don't believe there has been any actual valid reason for selling?
If you believe that, then presumably you discount the possibility of further bad news out of Europe or the US prompting further significant sell off.

KurwaJegoMac said:
I differ on this one, losing money in times like these means that you have bought your stocks too dear and that is the worst thing you can do.

Anybody can deem themselves to be right by holding stocks for years and years - eventually the market is likely to recover above the price you paid. It does not change the fact that you were wrong in your entry.

I acknowledge however that 'value investors' operate with a long term perspective and will maintain a short term paper loss if they think the stock price is below its' intrinsic value. Bear in mind that stocks can get much cheaper very quickly, buying and blindly holding because they are at a discount to intrinsic value means nothing when the stock keeps going down, down and down.

Just mentioning this for the newbies, because many get caught in the 'it will eventually recover' trap. There is a difference to buying a cheap stock relative to 'intrinsic value' compared to buying a cheap stock because it's cheaper now than it was a year ago.
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Alex, read the above and read it again.
 
littleshire said:
I differ on this one, losing money in times like these means that you have sold your stocks too cheap and that is the worst thing you can do.

Well... I have finished my buying for now, I have to start putting money aside again just in case the market goes to 3500 so I can buy more and even cheaper!

:)
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That's the spirit...this thread is full of people spruking sell sell sell, take the loss and learn, blah blah blah...the market will always be here, but it wont always be cheap.

Fortunes were made in the first GFC dip and fortunes will be made in this second dip.

Buy buy buy
 
KurwaJegoMac said:
I differ on this one, losing money in times like these means that you have bought your stocks too dear and that is the worst thing you can do.

Anybody can deem themselves to be right by holding stocks for years and years - eventually the market is likely to recover above the price you paid. It does not change the fact that you were wrong in your entry.

I acknowledge however that 'value investors' operate with a long term perspective and will maintain a short term paper loss if they think the stock price is below its' intrinsic value. Bear in mind that stocks can get much cheaper very quickly, buying and blindly holding because they are at a discount to intrinsic value means nothing when the stock keeps going down, down and down.

Just mentioning this for the newbies, because many get caught in the 'it will eventually recover' trap. There is a difference to buying a cheap stock relative to 'intrinsic value' compared to buying a cheap stock because it's cheaper now than it was a year ago.
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So_Cynical said:
That's the spirit...this thread is full of people spruking sell sell sell, take the loss and learn, blah blah blah...the market will always be here, but it wont always be cheap.

Fortunes were made in the first GFC dip and fortunes will be made in this second dip.

Buy buy buy
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Could not agree more. If you play this market well it is just a opportunity to transfer wealth from the impatient to the patient investors.
 
alexc2005 said:
You are hoping for QBE to bring a negative turn?
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It was the most negative of the big financials... something just doesn't smell right.

LifeChoices said:
I think you are right, I vaguely remember something like that happening during either one of the big gfc falls or the tech bubble fall - the market just shut down for an hour or something.
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It's called limit down.

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aZRWfr8j_IXc&refer=us

alexc2005 said:
Time to go to bed and read this weeks Eureka report for some more learnings :).

It's a pretty interesting one this week!

woot.

Night all :)
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Eureka report... good luck with that.

So_Cynical said:
That's the spirit...this thread is full of people spruking sell sell sell, take the loss and learn, blah blah blah...the market will always be here, but it wont always be cheap.

Fortunes were made in the first GFC dip and fortunes will be made in this second dip.

Buy buy buy
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The first GFC dip top to bottom was 6,800 down to 3,100. Or 45.8%.

This second GFC dip top to bottom so far is 5,000 down to ~3,980. Or 20.4%.

So why is now the right time to buy? I am not saying it isn't, but I am asking why it is...
 
skc said:
The first GFC dip top to bottom was 6,800 down to 3,100. Or 45.8%.

This second GFC dip top to bottom so far is 5,000 down to ~3,980. Or 20.4%.

So why is now the right time to buy? I am not saying it isn't, but I am asking why it is...
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I have a simple investment philosophy...buy stocks when they are cheap and thus offering greater potential for profit..stocks are cheap now...since i cant pick bottoms or reversals im left with picking stocks that i think are cheap, i think stocks are cheap now.

Plus i don't think things are as bad now as they were then, the Global financial system will not fail, sovereign debt will be restructured, lenders will take a hair cut, the BRIC country's will keep the commodity's boom and world growth going.

The yanks with cut spending and raise taxes eventually and the markets will come back and trade at around the top of the range (5000) at some point...and at that point the people who brought now will feel pretty satisfied with themselves and make good money...lest that's my experience from the first leg down.
 
I find there is always too much emphasis on buying, and when to buy. Buying is incredibly easy.

Selling is much harder.

Being able to sell at the right time for the right price distinguishes a good trader from an amateur.
 
So_Cynical said:
I have a simple investment philosophy...buy stocks when they are cheap and thus offering greater potential for profit..stocks are cheap now...since i cant pick bottoms or reversals im left with picking stocks that i think are cheap, i think stocks are cheap now.
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Why don't you wait to see how low they can go, then buy back after they show some sustained signs of recovery?
 
Time to put this thread to bed for now?

DOW lift off with Saturn rocket, up +470pts overnight.

A day is a long time in the market....

:D
 
So_Cynical said:
I have a simple investment philosophy...buy stocks when they are cheap and thus offering greater potential for profit..stocks are cheap now...since i cant pick bottoms or reversals im left with picking stocks that i think are cheap, i think stocks are cheap now.

Plus i don't think things are as bad now as they were then, the Global financial system will not fail, sovereign debt will be restructured, lenders will take a hair cut, the BRIC country's will keep the commodity's boom and world growth going.

The yanks with cut spending and raise taxes eventually and the markets will come back and trade at around the top of the range (5000) at some point...and at that point the people who brought now will feel pretty satisfied with themselves and make good money...lest that's my experience from the first leg down.
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I agree with all that and I am on record on this forum for buying during this low and the GFC. I also pumped a bit into my wifes super this week. I have been a long term share market investor since 1987 and one thing for sure, no one is going to ring a bell at the bottom or the top. We need to think for ourselves and buy good companies that are being sold ridiculously cheap that pay good dividends. I don't care if the price drops short term or even for years as I live off all the dividends that my stocks pay me. I do not need to redeem my capital nor do I have a margin loan, no forced selling from this investor. Keep up the good work, there is nothing like those dividend cheques coming in.:D
 
isplicer said:
Why don't you wait to see how low they can go, then buy back after they show some sustained signs of recovery?
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Your perspective is based on the presumption that the panic will continue and the market will go lower. Bear markets are prolongued downward drifts over time. Panic downward spikes are just that, spikes. They are a time to buy for the stout hearted.
If you have done your research and shares are showing as bargains now you have two choices: First choice is to buy now; and Second choice is to wait.

If you buy now you are either right or wrong. However you will have the share at a good price the market is likely to rebound above relatively quickly.
If you defer, you could miss out as the market rebounds quickly and this becomes an opportunity lost. If you defer and the market dips further, you could still decide to hold for an even lower price and still miss out.

Hard call, not one for the inexperienced and those lacking confidence in their own research.
 
TECHNICAL UPDATE

The very very strong support from the lows in face of negative strength (at the time) from overseas markets has me seeing a low in place for the immediate future.
However I dont think one needs to rush out and buy everything before it races back up towards 4500.
In my view there will be quite some consolidation between 3900 and 4500 while the market sorts itself out.

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XJO 19.gif
 
Julia said:
Panic sellers? Or people sensible enough to have stop losses in place?

So you don't believe there has been any actual valid reason for selling?
If you believe that, then presumably you discount the possibility of further bad news out of Europe or the US prompting further significant sell off.


Alex, read the above and read it again.
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No, no ,no Im sure most of the experienced investors had stop losses and sold out (probably bought back in when stocks were cheap), but a large amount of the selling has been people panic selling under pressure of a market collapse.

Of course there has been valid reasons to sell and I think in the next two weeks we are going to get even more and more valid reasons to sell coming out of europe.

I just think alot of the less experienced or less bold investors are currently "sitting the market out" for now, so that if there is further bad news, I don't expect it will be as steep of a drop.

P.S. gotta say, thank you tech/a for all your analysis, its good for a newbie like me to see what the more experienced traders opinions are (and likely react accordingly).
 
The market is bipolar... this isn't a great sign of health imo. I was trying to dig out some history of market bipolar behaviour and what it normally leads to...this is one example. But I am limited by the data I have at hand.

16-Jan-08 5809.678 -2.522%
17-Jan-08 5796.122 -0.233%
18-Jan-08 5747.251 -0.843%
21-Jan-08 5580.416 -2.903%
22-Jan-08 5186.846 -7.053%
23-Jan-08 5412.32 4.347%
24-Jan-08 5580.442 3.106%
25-Jan-08 5860.322 5.015%

I also read somewhere these numbers

26-Oct-87 -8.0%
23-Oct-87 0.0%
22-Oct-87 -3.8%
21-Oct-87 10.1%
20-Oct-87 5.9%
19-Oct-87 -22.6%
16-Oct-87 -4.6%
15-Oct-87 -2.4%
14-Oct-87 -3.8%

Anyone care to do some smarter historical review? Make sure you start with looking at volatility and see how it turns out, not look at market action before known crashes. I think/hope there are examples where extreme volatility doesn't lead to a crash.
 
I haven't read 'turtle soup', however, that one may be helpful in 6 months Time or so?
Although I could just be reading too much of the recent past into the future.
 
I still hold some gold and dont think that 1 good night on the dow means that you should sell out of gold straight away. In saying that I did not just buy gold in the last week
 
vkdirector said:
I still hold some gold and dont think that 1 good night on the dow means that you should sell out of gold straight away. In saying that I did not just buy gold in the last week
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What I'm hearing here is;

Dow Good = Sell Gold (trend will decrease)
Dow Bad = Buy Gold (trend will increase)

My Newbness prevails! :p
 
RexBudman said:
What if you bought Gold yesterday? Is it a bad thing that the DOW went up for gold holders? I'm curious...
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To me it looked like it 'came' for the second time yesterday. Usually that's not so premature. A third time could be pushing it, especially when the Dow is already up in the morning.
 
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