General / Off-Topic Record breaker in progress

[Robin of Spiritwood]

The market futures for the US have all hit their bottom limits i.e. they are not permitted to drop any lower as of around 10:30 pm Eastern Time.
The limit is 5% .
This last happened 3 days ago, when losses exceeded 2000 points, and the converse took place yesterday up 5% overnight, with a strong rally following in the morning.

I have never seen this kind of sawtooth pattern with giant teeth before, and it does bring to mind that shark from Finding Nemo. So there are extreme opportunities for the souls brave enough for such waters.

As for me, the biggest investment risk has been finally buying myself that hat. I got a deep purple fedora. Fancied myself rakish.
Wife says it looks like that cartoon character.

Detective Dik Tracy? No.
The Question? No.
So who then?
... < punchline pause

Secret Squirrel, she says.
And honestly, I never saw it in colour. Yep - Purple hat.
So. Not taking any more risks.

 

[GJ51]

You're just not old enough

Market volatility isn't a new phenomenon, but the current bull run has lasted for an unusually long time.

Investing isn't for the faint hearted.

If you're not properly balanced for your risk tolerance it will be painful.

 

[Robin of Spiritwood]

You're just not old enough

Market volatility isn't a new phenomenon, but the current bull run has lasted for an unusually long time.

Investing isn't for the faint hearted.

If you're not properly balanced for your risk tolerance it will be painful.

Seriously.
B & W Secret Squirrel, and I'm too young?!?

Well, at least I may respectfully doff the hat:

 

[Caramel Clown]

I want to see that hat now.

 

[GJ51]

Well - any seasoned market watcher know that nothing goes straight up forever. The 11 year bull market was far and away overdue for a major correction.

As I've stated many times previously, I knew that the bull took off when the previous high on the NASDAQ was 4800 and at 9600 it was a doubling of the previous base and was statistically the point at which a major correction was very likely. A prudent investor has to be properly positioned for the downside risk as it rises.

Unfortunately, the typical investor buys high and panic sells at the lows. Otherwise, the prudent investors wouldn't make wouldn't make profits. The old adage applicable now is, "don't try to catch a falling knife." If you are invested, weather the storm and don't look at the painful losses. You don't lose unless you sell now. If you pulled some off the table before the crash, wait until the market tells you the worst is over, It still looks early to call a bottom. At NASDAQ 7680 we've broken through a 20% correction and that portends a possibility of a 50% correction back to the old highs from 10 years ago.

Watching long term charts and assessing selling volume for selling exhaustion will be the key to spotting a bottom, but the event closings and the travel industry losses aren't good news for a quick turn around. Until we start to see a return to "normal" economic activities calling a bottom will be difficult. Once it's clear that all the bad news has been taken into account by the market, it will be time to move cash gradually back into the market.

An investor should have a 5 - 10 year horizon. Now is the time when you look for the buying opportunity. When we return to normal behaviors, such as attending sports events and travel, it will be time to take advantage as the underlying economics hasn't changed structurally. Taxation and regulatory structure should be more favorable than ever once the new bull starts. Be patient - but be ready - the time will come for those who planned ahead.

Market corrections are actually pretty predictable - it's only the reasons cited that change.

 

[EUS]

Market movement not surprising to anyone who follows cycle theory.

 

[GJ51]

Market movement not surprising to anyone who follows cycle theory.

Today's action actually hit the 50% re-tracement on the NASDAQ. Could be the bottom. Next week's action needed to confirm. The Fed is announcing a 1.5T pump in to re-flate.

I'm tempted to call today the bottom, but I'll await confirmation from the market itself. Look for some more volatility that can't break today's low. If the market can't break down below 7200 on the NASDAQ, then that signals that the shorts have been squeezed out and the selling is exhausted. If we get a convincing break below 7200 with volume, then there'll be more pain to come.

 

[Robin of Spiritwood]

10% drop in one day, circuit breakers tripped, worst since '87.
1.5 Trillion injection had little effect on algorithms bent on selling.

Imagine the position withOUT the Fed intervention? Another circuit breaker for sure.
DOW futures for Friday are heavy negative. Will the Fed inject another 1.5 trillion?

Maybe they should, IDK, buy some test kits and ventillators instead? Work on the actual problem for a change?

 

[metatheurgist]

Health Workers: "We didn't get working tests! My insurance won't pay for tests even though I'm symptomatic! I have to keep working even though I'm sick because wages are awesome in America!"
Economists: "Let put more money in the stock market!"

This will all work out well.

 

[Robin of Spiritwood]

Futures flipped positive, maybe it is settling?
Or, it's just more teeth in the shark.

 

[GJ51]

Futures flipped positive, maybe it is settling?
Or, it's just more teeth in the shark.

That's the question the market should answer in the next few days/weeks. If trading fails to break through recent downside levels - it's a bottom that looks like it will rally back with a vengeance once the virus panic recedes. The liquidity pump has been primed. rates are at historic lows.

The table is set for a V shaped recession of relatively short duration. Fear is at maximum levels and will dissipate.

It looks like a bottom here, but it still needs confirmation. If volatility remains over the short term, but can't break through the short-term lows a rally to the upside should be historic. Watch the trend lines where the lows are in an upward trajectory. The market will tell you what's happening if you know how to track it and analyse the technicals.

It looks like today (Fri) will be an up day. Ending the week on the upside is a positive. We are very close to a point where dollar cost averaging back into a good mutual fund should be on the table.

 

[Robin of Spiritwood]

Stock futures drop — hit 'limit down' — even as Fed slashes rates; Dow futures off 1,000 points

The Fed launched a massive monetary stimulus campaign to curb slower economic growth amid the coronavirus outbreak.

www.cnbc.com

Well, this looks ... nuclear. Rather unexpected after a good Friday rally.
I think thing are going to whipsaw for a while.

Edit-

The Dow had its worst point drop ever as stocks tumbled again

US stocks ended sharply lower on Monday, with the Dow posting its worst point drop in history and falling to its lowest level in nearly three years. Worries mounted that central banks' emergency measures over the weekend meant the economy is in much worse shape than previously believed.

edition.cnn.com

Considering that the stimulus is full on rate cut to ZERO and futures have tanked to the limit, it might be safe to venture that the stimulus has failed, a full on crash past Bear market is likely, and the recession is now inevitable.

I much rather prognosticate positively generally, but the Fed is now basically outta ammo, and traders are running.

 

[Robin of Spiritwood]

...annnd it's UP again!

The teeth man, the up-and-down teeth...