kennas said:The dead cat was 5000 back to 5100, now correction, consolidation. PEs must be looking very good now. No company downdgrades that I have seen. Should be all record reports again this year.
Should be all record reports again this year.
I'm not sure if a finance editor for the Fin would keep his job for very long though if they published out of date or incorrect data.
I suppose a lot depends on how people differentiate a correction from a crash.
About 4 weeks ago I uploaded a spreadsheet that calculates the average PER for various market indexes. Back then the average prospective weighted PERs (by mkt cap) for the ASX50 to ASX300 indexes were all in the ~16-17 range. I haven't updated the spreadsheet with the latest prices but obviously the PERs would be a little higher now.
There used to be a ball park rule of thumb that said a fair PER was 20 minus the inflation rate. With inflation at ~3% then I see a fair market PER as ~17 atm.
Blind Freddy can see that overall our market is not cheap but I don't see it as grossly expensive either. Therefore I'm not expecting a 'crash' atm, especially based on company fundamentals. But having said that, looking at the weekly XJO chart I think it would only take a reasonably credible hint from somewhere that inflation was looming (due to high oil prices or whatever) and that will take a lot of steam out of the market.
Imo, a retrace back to the ~4800 (~9% drop) January support levels would be a 'healthy correction' and not a crash if looking at the overall long term scheme of things of the bull market that started after the '87 crash (now '87 was a crash )
A continued fall below 4800 then obviously all bets are off as that would be a pretty strong signal for me that we are starting a much more likely sustainable bear market.
Finally, all of the above should be taken in context depending on what time frames you invest/trade in.
Anyway, just food for thought
NettAssets said:"The stock market is crashing"
Sure looks like it today
Glad I loosend off a couple of my stop losses last night in case we take a bit of an early swing cause it sure wont last long
John
Part of my Trading PlanTraderPro said:Was the "loosening" a part of your trading plan or just a "gut" feeling?
Good Luck!
kennas said:I'm feeling nervous about the Fed announcement tonight. I'm expecting the 25 basis point rise, but I'm worried Mr B is going to say that there could be another interest rate rise in August. This will send a shiver through the market, especially PMs. Gold will be smashed.
What's your guess?
GreatPig said:So what time exactly does the world end?
GP
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