Start of a bear market - DJIA January 2018

Discussion in 'Trading' started by FireWalker, Feb 10, 2018.


    Using DIA for analysis, because YM is too open to low-volume manipulation.

    We have a spectacular breakaway gap on Jan 30th. My read on the market: the 26th ended normally. A discussion happened over the weekend, possibly resulting an old-money divorce. Trust was violated and a family heirloom of important stock was sold Monday morning. This is another reason futuresaren't the thing to watch. The trust/heirloom consisted of DJIA stocks themselves, along with some S&P 500's. Insiders knew that stock was never to be sold, unless a massive violation had occurred.

    Word got around that morning and old money players sold like crazy. That set off buy programs, as usual, and the morning ended unchanged. After lunch, word got around and they changed their minds. Overnight, word spread resulting in the gap down on Jan 30th. That is a breakaway from prior market conditions. We have an entirely new market driven by fundamentals and a different financial structure. Old assumptions are gone. The so-calledPPT 0.78% no longer has an unlimited line of credit. Also, they can't rely on the same structural support.

    This market will not correct until a 1930's type of return to solid value occurs. This is a great unwinding of all financial and monetary manipulations as we return focus to cash flow and real goods sold/exported.

    My guess, is Toshiba's example might be followed. In 2015, 8 executives resigned citing $1.2 billion in accounting issues (aka fraud). Some of those executives had been with Toshiba since the 1970's. They seppuku'd themselves and may have done so early enough to avoid criminal prosecution. Time will tell, but at least they did something right showing a semblance of doing the right thing, if not showing remorse. Given the excesses of the 1980's, leading up to the dot com bust of 2000, we have over 30 years of financial manipulation to work through at an individual corporation by corporation basis. While I see brand/corporation surviving, with a total replacement of all board members and executives. Gen-X is tired (I am one of them), so the offers better be kind. Millennials lack experience, but will be assistive in this generational transfer. Back to the point: companies and audits are forthcoming. Don't underestimate the significance of recent Pentagon discoveries. Arthur Anderson went under in 2001, I believe, and auditing will make a comeback.

    These corporate numbers represent people's jobs and futures , as well as natural resources and efficient use thereof, while directing them toward quality exports. Americans will have to own up to their marketing and provide value to the world.

    Near term I see $180 DIA as a breathing place for support. Fundamentals will be reviewed and I think $140 is likely within a year or two, on the outside. I'd like to see things happen more quickly, as the age of the internet has made communication much faster. There is a time required for emotional integration, and work, however, even with instant information.

    How long this bear market lasts and how deep it goes is up to us.

    Position: Neutral. I do not advise shorting stocks (manipulation, accounting, etc.) Speculators should focus on ETF's and minis. That will clarify and allow the experts to fix the problems.
  2. jinxu


    What exactly is the goal of your post? It sounds like another of millions of bs explanation you can find anywhere on the internet. If you are trying to forecast, you need a target price and time. I didn't see any hint of either. Just saying price will go up or down from here is not forecasting. Anyone can do it with with a 50% chance of being right.

    I really expected better after seeing you registered back in 2003.
    lcranston likes this.
  3. ElCubano


    The thread says bear market, there’s your price projection and looks like the time is Jan 2018 as a starting point. All in the thread title
  4. KevinD


    Why don't you re-read it with some critical thinking skills? He might be wrong or he might be right, but he certainly has offered an opinion that is unique and is rarely discussed. It might be more along the lines of the Fourth Turning or something similar, a.k.a. a generational purging of excesses and can kicking that extends back to at least the 1980's.

    He alludes to the timing of this event and there is good reason for that. The "changing of the guard" with the transference of leadership of the Federal Reserve. (by the way, did you know that Alan Greenspan assumed leadership 2 months prior to the crash of 1987?). In other words, it might not be in Powell's interest to continue with the status quo.

    And he did give you a price forecast, but you were in such a rush to slam his post that you didn't even notice it. He said DIA 180 or perhaps 140.
    i960 and Van_der_Voort_4 like this.
  5. jinxu


    I forecast the 2008 (or 2009?) bottom BEFORE it happened. It's not hard to do but you have to understand market fundamentals.

    Sorry, it's still BS. If there is any critical thinking, the following elements are missing:

    -Give the Forecast
    -Give an Explanation of the Forecast
    -Give Data/Evidence to support the Forecast

    Otherwise it's still just guessing up/down.
    Last edited: Feb 10, 2018
  6. At every major market turning point there is some form of divergence in the indexes., have not seen that yet.
    Chris Mac likes this.
  7. Markets are dynamic, forecasts are silly, IMO. Forecasting the next day is not even possible. Make yourself available for what the market is offering each day in real-time. Start there first.
    Sprout likes this.
  8. jinxu


    True. Forecasting is just a part of the overall formula. But for some reason it's the one that newbies fixates on as if it's the most important element.
  9. comagnum


    1900-2009: Fast & furious corrections of at least 10-20% from weeks to months considered normal.

    2010-2108: A market not at all time highs for a week or two is considered a crash or the start of a bear market.

    Thanks to our long low volatility market the herd is easily spooked.

    The start of a potential bear market typically implies your at least below the bulls highest month, which we are not. Bull markets of old routinely broke through previous month lows before hitting new highs. 90's (left) Current market (right)
  10. Interesting stats on corrections and bear markets.

    The stock market is officially in a correction... here's what usually happens next
    • "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.
    #10     Feb 10, 2018