Is this a bear market?

ProDave

For my money I still think markets are still heading down.

Look at the FTSE100 on a 6 month scale.  Sharp downward fall to 12th March.  Slower "sawtooth" fall to 23rd March. A but of a jump up after 23rd March then resumed the slow sawtooth downward trend. Whether the present slow downward will get lower than the 23rd bottom who knows.

At the first sign of "good news" on this virus i will start buying, a bit.  Until then I suspect the downward trend to continue.

All IMHO I am probably wrong.

MaxiRobriguez

ProDave said:

For my money I still think markets are still heading down.

Look at the FTSE100 on a 6 month scale.  Sharp downward fall to 12th March.  Slower "sawtooth" fall to 23rd March. A but of a jump up after 23rd March then resumed the slow sawtooth downward trend. Whether the present slow downward will get lower than the 23rd bottom who knows.

At the first sign of "good news" on this virus i will start buying, a bit.  Until then I suspect the downward trend to continue.

All IMHO I am probably wrong.

Technical analysis is rubbish. The FTSE100 was practically flat for 3 years from Feb 2017 -> Feb 2020, and then out of nowhere a panic sell off. The moving averages and 'death crosses' came about two weeks too late for technical analysis supporters to use the information to determine actions. 

Whether or not the FTSE and other indices go up or down from here depends on the final economic damage wrought by the virus. An element of this has already been priced in, hence the drops, but there's more to learn still, and various scenarios from V-shaped recovery through to multi-year bear market could still play out.

schiff

Thrugelmir said:

For fun. My tuppence worth after having polished my crystal ball. The S&P 500 will bottom out nearer 1800. (2,527.78 at close today).  

Out of interest - serious question - how are you going to position yourself for that scenario?

Thrugelmir

schiff said:

Thrugelmir said:

For fun. My tuppence worth after having polished my crystal ball. The S&P 500 will bottom out nearer 1800. (2,527.78 at close today).  

Out of interest - serious question - how are you going to position yourself for that scenario?

Invest on the basis of company fundamentals, themes, sectors but not market indexes at the current time. With regard to US Companies specifically, I hold US stocks both directly and indirectly but have never held the S&P 500 itself in any form. 

MaxiRobriguez

Thrugelmir said:

schiff said:

Thrugelmir said:

For fun. My tuppence worth after having polished my crystal ball. The S&P 500 will bottom out nearer 1800. (2,527.78 at close today).  

Out of interest - serious question - how are you going to position yourself for that scenario?

Invest on the basis of company fundamentals, themes, sectors but not market indexes at the current time. With regard to US Companies specifically, I hold US stocks both directly and indirectly but have never held the S&P 500 itself in any form. 

Out of interest, why not indexes at the current time? Seems a relatively easy 'hedge' bet given no one knows how this will play out. 

Prism

Good companies will most likely survive and recover quickly after this is over. Bad companies might not survive at all or might be an amazing recovery play. The indexes of course hold both. The safe option is to hold just the good companies, which you can do actively or passively. Some people might do very well from picking the right recovery plays but its hard to do.

Thrugelmir

MaxiRobriguez said:

Thrugelmir said:

schiff said:

Thrugelmir said:

For fun. My tuppence worth after having polished my crystal ball. The S&P 500 will bottom out nearer 1800. (2,527.78 at close today).  

Out of interest - serious question - how are you going to position yourself for that scenario?

Invest on the basis of company fundamentals, themes, sectors but not market indexes at the current time. With regard to US Companies specifically, I hold US stocks both directly and indirectly but have never held the S&P 500 itself in any form. 

Out of interest, why not indexes at the current time? Seems a relatively easy 'hedge' bet given no one knows how this will play out. 

For a whole variety of reasons. On a personal level I'm firmly in the active camp during extremely volatile markets. 

coastline

MaxiRobriguez said:

ProDave said:

For my money I still think markets are still heading down.

Look at the FTSE100 on a 6 month scale.  Sharp downward fall to 12th March.  Slower "sawtooth" fall to 23rd March. A but of a jump up after 23rd March then resumed the slow sawtooth downward trend. Whether the present slow downward will get lower than the 23rd bottom who knows.

At the first sign of "good news" on this virus i will start buying, a bit.  Until then I suspect the downward trend to continue.

All IMHO I am probably wrong.

Technical analysis is rubbish. The FTSE100 was practically flat for 3 years from Feb 2017 -> Feb 2020, and then out of nowhere a panic sell off. The moving averages and 'death crosses' came about two weeks too late for technical analysis supporters to use the information to determine actions. 

Whether or not the FTSE and other indices go up or down from here depends on the final economic damage wrought by the virus. An element of this has already been priced in, hence the drops, but there's more to learn still, and various scenarios from V-shaped recovery through to multi-year bear market could still play out.

Even though I look at charts and indicators I agree a lot of this technical analysis isn't going to keep you on the right side. Moving average cross overs are very late signals and probably half the move is gone by then. The 200 day moving average itself was used as a top up region many years ago by institutional buyers in the USA. I know there are very few who use this stuff or even care about it but plenty indicators and tools can give you an indication when markets are at extremes.
From what I remember of 2009 the monthly job figures were the turnaround in fortunes and the start of the new bull market. Losses were say 800,000 one early month then a reduced loss of 400,000 came in and the markets surged. It was still a loss but an improvement. Todays news is in the link below. Maybe the virus numbers will be used by the markets in a similar way ? I doubt they'll wait until the end.
https://www.calculatedriskblog.com/2020/04/march-employment-report-701000-jobs.html




 

schiff

Thrugelmir said:

schiff said:

Thrugelmir said:

For fun. My tuppence worth after having polished my crystal ball. The S&P 500 will bottom out nearer 1800. (2,527.78 at close today).  

Out of interest - serious question - how are you going to position yourself for that scenario?

Invest on the basis of company fundamentals, themes, sectors but not market indexes at the current time. With regard to US Companies specifically, I hold US stocks both directly and indirectly but have never held the S&P 500 itself in any form. 

Would that include Fundsmith and Smithson?

Thrugelmir

schiff said:

Thrugelmir said:

schiff said:

Thrugelmir said:

For fun. My tuppence worth after having polished my crystal ball. The S&P 500 will bottom out nearer 1800. (2,527.78 at close today).  

Out of interest - serious question - how are you going to position yourself for that scenario?

Invest on the basis of company fundamentals, themes, sectors but not market indexes at the current time. With regard to US Companies specifically, I hold US stocks both directly and indirectly but have never held the S&P 500 itself in any form. 

Would that include Fundsmith and Smithson?

As with Lindsell Train they invest on the basis of a set philosophy. Doesn't guarantee that they'll always get it right over any given time frame. Far too easy to invest on the basis of historic performance into collective investments without looking under the bonnet. A certain individual springs to mind in this regard. Who once, with his investment team, struck a seam of gold. The larger funds become the more difficult it can be to sustain performance.