Shareswatch Australia

Australian stock market, share market investing, ASX charts, market analysis & economic forecasts.

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Australian Stock Market Outlook

This is a discussion forum focused on the outlook or forecast for the Australian stock market & ASX listed stocks. Please feel free to share your view or outlook for Australian listed shares and the Australian share market here but please refrain from making buy/sell or hold recommendations.

Comments are also welcome in relation to the short-medium term trends for the ASX All Ordinaries and S&P ASX 200 and longer term outlook covering the next few years (or beyond).

For Shareswatch Australia articles related stock market and economic forecasts (guesstimates) please see our forecasts section.

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Note: Any comments not related to the outlook for the Australian stock market will be deleted.

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This forum is for discussion purposes only and is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions. Comments aimed solely to talk-up stocks or to spread rumours will be deleted.

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894 Comments

894 responses so far ↓

  • 1 Greg Atkinson // Jun 11, 2010 at 6:19 pm

    Well the Australian stock market closed above 4500 today and it looks like the correction has played out much as I expected when I posted Has the stock market correction gone too far? back on the 24th May.

    But I am not getting too carried away with the trade numbers out of China recently. What many people tend to forget is that exports tend to have long lead times, in other words the decision to buy products from China is often made months before the actual transfer of goods/payments takes place.

    So the recent export data from China is largely based on the happy days when EU Governments thought borrowing and spending was a great thing to do, but now things are much different and I don’t expect the trade figures out of China will be quite so good for the rest of 2010.

  • 2 Anon // Jun 12, 2010 at 4:37 pm

    Hey Greg, really like this setup now. Well done – its improving on every revision you make.

    “but now things are much different and I don’t expect the trade figures out of China will be quite so good for the rest of 2010.”

    And the markets have picked this up and discounted the probability of this occuring. So one would expect people will buy the fact once its widely known.
    Not much to talk about here, haven’t done much (except relax)…heres something Jim Rogers mentioned that I found useful for current market conditions:

    Jim Rogers Paraphrased:
    If you buy in Panic and can hold through the volatility, you will generally comeout ahead.

  • 3 Greg Atkinson // Jun 13, 2010 at 9:15 am

    Thanks Anon. I ditched the previous forum set-up and decided to set up everything manually.

    As for the markets, well I figure we are going to see them head up for a while now unless BP start another oil leak :)

  • 4 Biker // Jun 13, 2010 at 9:54 am

    “…unless BP start another oil leak…”

    Wondering if, in years to come, we’ll look back at this as a Black Swan event (no pun intended here); or as a horde of little greasy cygnets cygnalling another peak oil dilemma.

    The Norweigans seem to have mastered the art. Maybe BP and others need to contract the experts to totally manage all production. We all considered that at some point governments might intervene in the energy business(es); but this (and future such mishaps) make Exxon look insignificant. Getting at the stuff is going to become more expensive… and riskier. And, as it becomes more expensive, the risk of shortcuts increases.

    How long before all gasoline is rationed _strictly_ for (very expensive) air flight, I wonder? Better see more of the world while it’s so cheap, I guess… .

  • 5 Anon // Jun 13, 2010 at 2:03 pm

    Speaking of BP, looks as though…after perhaps one more pull back…BP will be marching into a recovery in terms of its share price. The question now is will the recovery levels hold as more of their potential liabilities clarify.
    Jim Rogers says he’s got his eyes on BP but he will only pounce when its out of the headlines. That could be awhile, given the mess they’ve got themselves in.
    I did some rough guesstimates on their potential liability and i’ve got best case 30 billion…150 billion worst case. But one would expect if the shareprice makes a substantial recovery (i.e. ~$45-50) that it would still get smashed severely once the potential liability levels are known.
    Looks like this stock is a trade, until it isn’t.

  • 6 Anon // Jun 13, 2010 at 6:31 pm

    I think oil might break 140$ a barrel this year (or at least rally significantly). Something just doesn’t look right and my instincts are telling me its going much higher very soon. Will Saudis finally come clean with their oil production capability/reserves? Maybe some left field event to further restrict supply?

    Inflation adjusted oil prices are around the levels they were in 1979.
    1946 real oil prices were at $17.81. Not much of rise given the obvious supply constraints.

    Bullish Chart:
    http://inflationdata.com/inflation/images/charts/Oil/Inflation_Adj_Oil_Prices_Chart.htm

  • 7 Vince L // Jun 16, 2010 at 7:28 am

    Maybe the correction is over now and the market will rally back up to 5000?

  • 8 Anon // Jun 16, 2010 at 12:20 pm

    Vince who knows? Still pretty bearish out there. Lots of people comming out of the woodwork with their double dip thesis.

    Looks like EUR/USD is finally making a big move! Could be a very sharp rebound in progress here.

  • 9 Greg Atkinson // Jun 23, 2010 at 5:52 pm

    Well the rally across the major markets seems to have come to a screeching halt. Still I expect the Australian stock market to get a boost when the Resources Super Profits Tax (RSPT) is either buried or heavily modified.

    I still reckon we could see the ASX All Ords at 5500 around September.

  • 10 Anon // Jun 23, 2010 at 9:08 pm

    Well if Julia gets in the RSPT is gone. Go Julia – i’ll vote for her…she is better than Abbott.

  • 11 Biker // Jun 23, 2010 at 10:52 pm

    I think your comments are on the money, Anon. The only way Labor can extricate itself from the current impasse is if they ditch Rudd.

    And the All Ords will rise, as Greg predicts, if the RSPT goes.

    A lot hangs in the balance, as we sleep… .

    NB: Maybe Henry didn’t need to go, Greg(!) (?) (!) :)

  • 12 Anon // Jun 24, 2010 at 8:19 am

    I kinda feel sorry for Rudd…the more I look at it, the more this possibly looks like it was planned from a very longtime ago (just waiting for an opportune moment to pounce). How cold and backstabbing is politics – you need a tough skin.

    I hope Julia can resurrect labour once she gets in. She looks like a leader we can be proud of!

  • 13 Biker // Jun 24, 2010 at 11:21 am

    Well, the perception of a Gang of Four, making most of the decisions, without any consultation, was probably clever media spin which worked against Rudd, politically… .

    The RSPT was so badly conceived and managed that it reinforces perceptions that Rudd a.) did not consult widely, either within Labor or with all the stakeholders; b.) withheld the Henry report, until even Labor supporters believed it was hidden; c.) put Henry in an absolutely untenable position. Rudd’s over-the-top micro-management only seems logical and appropriate when you consider that everything he delegated went up in flames… .

    So Rudd may be perceived as both hero and fool, often by the same people.

    But Abbott is a _prize_ fool. The legal issue regarding non-declaration of his housing loan is _nothing_. The sheer financial stupidity of borrowing that kind of sum against your home equity is laughable. He’s doing just what the Brits and Yanks did! It also clarifies the policy differences between Abbott and Hockey, back on April Fools’ Day:

    http://www.theage.com.au/national/hockey-contradicts-abbott-on-property-20100331-revk.html

  • 14 Anon // Jun 30, 2010 at 1:11 am

    Buying some stocks here and unwinding some portfolio puts.
    This is looking like panic selling to me but I could be wrong so i’ll keep somemore portfolio insurance/puts on just in case.
    Haven’t been doing a whole lot lately but might step in buy more and get active if we keep falling.
    Just waiting for the end of the world pundits to comeout of the woodwork and i’ll buy big ;)

    One thing is clear is this rebound will not be like the one we experienced in March/April. Will likely be a slow and grindy type of rise.

    *All posts by this poster is not financial advice.

  • 15 Anon // Jul 1, 2010 at 5:33 pm

    8 red down candles in a row. My technical models are screaming a bottom now.
    The last time we had 8 candles like this on the XAO was March 03 just before the 5 year bull-run. Not to say that would happen again – it would be unlikely – but my bet is a slow developing rally over several months into December.

    *All posts by this poster is not financial advice.

  • 16 Greg Atkinson // Jul 1, 2010 at 5:45 pm

    It’s crazy out there Anon :) But what can you expect, end of FY madness meets rumours about China. I reckon it will all come out in the wash and there is another rally in the old market. But 5000 looks a long way off and of course 5500 looks like it will be a stretch to hit this year.

    I wonder how much money the housing market is drawing out of the stock market?

  • 17 Anon // Jul 1, 2010 at 6:03 pm

    In terms of 2011 targets…i think we will break the recent lows not this year…but next year based on historical price movements/observations.
    Maybe about ~3,900 on the XAO in 2011. Lets see if this call works out (which is unlikely).

    So essentially the levels we are at now are about ~5-7% from where we may be after a possible crash next year (~25%).
    Doesn’t look too risky to me when you factor in dividends.
    Although holding through a bear market post crash and bull market post correction are completely different beasts (i.e. stocks become timebombs (constant downgrades) even in basing periods, post bear market crashes). I wouldn’t touch stocks with a ten foot pole if I had strong convictions we were in a post crash bear market.
    So I guess the key this year may be to avoid companies that have downgrades (theres usually more than one but not always) and stock picking not sector/secular bias. There was a recent study done suggesting there were ususually low levels of stock pickers in the market, which is a bullish sign for this method going forwards.

    *All posts by this poster is not financial advice.

  • 18 Anon // Jul 1, 2010 at 6:23 pm

    “It’s crazy out there Anon But what can you expect, end of FY madness meets rumours about China”

    Isn’t it funny how all these things that can go wrong do at big turning points in the market. At the top of the market we had everyone bullish and all the stars lining up (China, economic recovery etc) and at the bottom almost everyone is bearish and the doomers are all calling for another crash.

    “I wonder how much money the housing market is drawing out of the stock market?”

    Must be loads. I hope the people who are getting in now can survive a possibly big drawdown in equity and unpredictable shocks. I wish them well and hope they can make good returns.

    *All posts by this poster is not financial advice.

  • 19 Anon // Jul 1, 2010 at 6:25 pm

    Bearish Sentiment near 52 week high:

    “Given the recent market weakness, it’s not surprising that bearish sentiment among newsletter writers is near a 52-week high. According to the weekly survey from Investors Intelligence, bearish sentiment rose to 33.3% in the latest week which is the highest level since July 2009. Although bearish sentiment is on the increase, a plurality of advisors still consider themselves bullish (41.1%).”

    http://www.businessinsider.com/pundit-bearishness-has-hit-an-extreme-2010-6

  • 20 Anon // Jul 1, 2010 at 7:54 pm

    The EUR/USD is rising again. Still feel a big up move is comming. My technical models say it and my gut feels it ;)
    But its abit like a heart monitor the way its oscillating atm..lots of noise.
    Although, prepared for the fact it could break to new lows before starting this uptrend, in order to flush out weak hands.
    The Euros rise could be a leading indicator for equities near term direction?

    *All posts by this poster is not financial advice.

  • 21 Anon // Jul 1, 2010 at 8:05 pm

    “Jim Rogers says he’s got his eyes on BP but he will only pounce when its out of the headlines. That could be awhile, given the mess they’ve got themselves in.
    I did some rough guesstimates on their potential liability and i’ve got best case 30 billion…150 billion worst case. But one would expect if the shareprice makes a substantial recovery (i.e. ~$45-50) that it would still get smashed severely once the potential liability levels are known.”

    Looks like Jimmy was correct…should have waited until all the media hype died down before going in! Have been smacked to the wall on this one. My protective puts have saved me but still down 10-15% even with the puts. I was right about one more pullback before the upmove…but 26-27$! was not where I thought we would go! Its 3% of my portfolio and 3% too much!!
    Still think 45$ is possible but probably be very bumpy and volatile en route..especially in August where the relief well is supposed to be completed. I’ll stay out of stuff like this in the future and wait for the dust to settle instead of trying to be a hero and ride the rapids. Historically theres plenty of time to get on stocks with situations like this and this was an error on timing.

    *All posts by this poster is not financial advice.

  • 22 Biker // Jul 1, 2010 at 8:39 pm

    “I wonder how much money the housing market is drawing out of the stock market?”

    It’s hard to know. I was sceptical about claims that overseas investors were buying Melbourne and Sydney with both hands, but it appears that they _were_ boosting both markets.

    A realtor just rang me two days running, trying to list anything and everything we had. I gently reminded him that he had a reputation for working for buyers, rather than sellers. His response surprised me. He had just sold a home I knew well, for around $100K more than I thought it worth.

    Land is still on the move, with prospective buyers camping out in cold wet weather to bid for blocks well north of Perth. Some of them already have properties, according to the papers; but I’d never heard of anyone but FHBs doing that before… .

    Despite all this, I sense that money _isn’t_ moving a lot here. Confidence may have plateaued, perhaps because of the RSPT, perhaps due to the reining-in of immigration, perhaps due to interest rates. Land is in short supply, despite WA’s Housing Minister’s claims that he’ll create the lowest medians in Australia. Construction appears to be slowing… and on weekends there are fewer ‘lookers’ in display homes than we’ve seen in years. We must have seemed the most likely to build, to one agent… because she has emailed us _daily_ with plans, offers, etc.

    So if money is flowing from shares into realty, it must be pretty low-key. I think people just have their hands in their pockets, at the moment. We do, too… . :)

  • 23 Anon // Jul 1, 2010 at 8:41 pm

    Alot of wide range sideways action (as Greg alluded to aswell) likely for the next few months with a big rally possible in Oct-Dec:

    “Stocks this year have followed a Cycle Composite, which blends the historical presidential and 10-year cycles, plus annual seasonal tendencies.Will the pattern hold?”

    http://barrons.wsj.net/public/resources/images/BA-AT138_Street_NS_20100611194533.gif

    “ALMOST NO YEAR IS “TYPICAL.” But the Ned Davis Research chart here of the 2010 Cycle Composite shows that this year has been pretty close. The composite equally blends the past behavior in the second year of a presidential term, years ending in zero and the annual seasonal pattern. And we had just started to believe the news mattered.”

    *All posts by this poster is not financial advice.

  • 24 Ned S // Jul 1, 2010 at 8:55 pm

    Was curious how you were making out with BP Anon.

    “how much money the housing market is drawing out of the stock market” – Not a lot perhaps? But that could change if house prices do correct a bit.

    Julia – She’s ALP – I’ve had enough of them for life now.

    Tony and his $710k housing ATM withdrawal – Yeh, I would have hoped he was old enough to know better.

  • 25 Anon // Jul 1, 2010 at 9:06 pm

    Ned yeah BP is abit of a disaster…but my portfolio only really moves if WMT, SNY, PFE and Citigroup moves as it makes up most of my portfolio…i’ve taken clear stock bets on these this year…so lets pray they dont go like BP. But I’ve structured things so that if one of those 4 goes off the cliff seriously I will be up in both directions (I bght alot more OTM puts than stock held). So I actually make more if we crash than if we rise…but I dont make anything if the fall is only like 5-10% on the stock as my puts dont kick in.

    Mistakes are all part of this game and i’m prepared to make them aslong as I dont make them again.
    I’m up 10% on Citigroup up 5% on SNY down 3% on PFE and down 5% on WMT. So my entire portfolio is up alittle even though weve fallen 7?%. I was up more when we were alot higher and have been in drawdown obviously.
    But if you dont have drawdowns you cant make money…the two need to happen eventually.

    *All posts by this poster is not financial advice.

  • 26 Anon // Jul 1, 2010 at 9:18 pm

    But yeah I guess i’m abit too critical…I was up 25% in May and down 5% in June. So I shouldn’t be beating myself up too much.
    I just hope i’m not down another 10% in July as all my effort May would evapourate!!

    *All posts by this poster is not financial advice.

  • 27 Ned S // Jul 1, 2010 at 9:45 pm

    Only stuff I ever had a go at trading was a bit of bullion. And despite the fact it was in a bull run about the best I could manage was to break even! :)

  • 28 Anon // Jul 1, 2010 at 9:57 pm

    I guess I can feel your pain re: Gold Ned.
    I got burnt when I tried to enter gold…its too volatile for me. I’m thinking of buying long dated calls for silver, but I am hesitant because me and precious metals dont seem to do well together. I dont make money buying these things.
    My track record buying commodity stocks is poor aswell…. BP just added to the dismal record. I guess thats why I didn’t put much in it … and if you look at my previous posts I kinda knew what was going to happen re: BP but still remained bullish! – absolutely idiotic and deserved to lose.
    Like you said awhile back Ned, we have to stick to our circle of competence and not try to do things we are hopeless at!
    Better to do nothing than do something we will lose money on ;)

    *All posts by this poster is not financial advice.

  • 29 Anon // Jul 1, 2010 at 11:15 pm

    DJIA down again…we are now more than 14% below 2010 highs.
    9600 might be the floor if we get there…@ 15%.
    Still cant see decent reasons for stocks to be this cheap…alot of stocks are trading at or below 08 GFC levels which doesn’t make sense since some of these stocks have increased earnings since then! The yields on some stocks with good/stable FCF and low debt is mind boggling.
    Logic is now totally out the window and the bears are in control until they arn’t.
    Not sure whether to buy more yet…will sit on my hands as I’ve got alot of longs already.

    *All posts by this poster is not financial advice.

  • 30 Anon // Jul 1, 2010 at 11:27 pm

    EUR/USD continues to rally…1.24+ now…looks like equities will rebound soon if this is a leading indicator.

    *All posts by this poster is not financial advice.

  • 31 Anon // Jul 1, 2010 at 11:32 pm

    EUR/USD breakout looks massive…targeting 1.40 possibly.

    *All posts by this poster is not financial advice.

  • 32 Anon // Jul 1, 2010 at 11:44 pm

    trading bots are triggering and buying now…EUR/USD is off ;)
    Stock market is still sick…shocking.

    *All posts by this poster is not financial advice.

  • 33 Anon // Jul 2, 2010 at 1:58 am

    DJIA has bottomed out here after testing the 9,600 area (huge support).
    Upwards from here i rkn. I’m taking off more portfolio insurance…actually i’m taking off alot.

    *All posts by this poster is not financial advice

  • 34 Anon // Jul 2, 2010 at 2:13 am

    Buying some stocks here.

    *All posts by this poster is not financial advice

  • 35 Ned S // Jul 2, 2010 at 8:05 am

    I’m just glad I was asleep while it all happened! :)

  • 36 Anon // Jul 2, 2010 at 9:46 am

    Ned you missed an action packed night ;).
    Well i’m half dead now so happy to leave my portfolio again for a few months or till EOY. Lets hope I dont have to bloody come in again and nurse the thing.

    Sold 98% of my portfolio puts so my portfolio is pretty uninsured now. Lets pray for a sustained upmove so I can re-buy insurance at much lower prices ;).

    Sleep time!!

    *All posts by this poster is not financial advice

  • 37 Greg Atkinson // Jul 2, 2010 at 11:03 am

    At times like these I focus on doing my portfolio paperwork and not watch stock prices too much. It helps me relax and not get sucked into the mood of the day :)

  • 38 Anon // Jul 2, 2010 at 11:51 am

    Its very tiring when you get sucked into the mood of the day I must admit.
    Getting to the stage where its abit pointless reading anything on the financial sites as most of it is wrong or sensationalistic. e.g. end of the world, double dip, scare moungering.

    Just check technicals a few times a week, occasionally fundamentals and sentiment indicators and thats about all you need I rkn. Keep it simple and infrequent.

    *All posts by this poster is not financial advice

  • 39 Anon // Jul 3, 2010 at 3:19 am

    DJIA down again ! ouch!
    Looks like we might have abit of a slow bottoming process…not the normal spike back…which I guess is better for a sustainable rally.
    Pundits are now going on about the “death cross” indicating a sell signal and proceeding bear market. The death cross is where the 50dma intersects the 200dma.
    I’ve looked back for about 30ish years (on the XAO) and noticed that this signals further lows ~50% of the time…so the other ~50% has actually signalled a market bottom or close to it.
    Given valuations, sentiment and the fact we are trading at recessionary levels when theres no recession, i’m betting on an intermediate bottom.
    Portfolio insurance is abnormally high, volatility has sky rocketed, bears are everywhere…retail investors are trying to short. Lots of warning signs here! I’ve never seen so many obvious signals to go long before? But perhaps I am wrong and the market is right.

    *All posts by this poster is not financial advice

  • 40 Ned S // Jul 3, 2010 at 3:30 am

    A thought to bounce around while you’re watching the remainder of the session maybe Anon? :

    http://articles.moneycentral.msn.com/Investing/JubaksJournal/which-ways-will-world-markets-go.aspx

  • 41 Anon // Jul 3, 2010 at 4:16 am

    Hey Ned…you’re still up :)
    There could be a divergence in terms of performance between developed and developing markets. Didn’t think about this possibility.
    I guess my rationale for investing in the US is mainly my concern for the AUD. Reserve currency is a much safer area for now anyways (albeit i’m sure this will change in time).
    Also there appears to be better value in the US atm in terms of growth prospects and large cap cigar butts ;).

    I wish this rally would hurry up and start…its a pain staking bottoming process !

    *All posts by this poster is not financial advice

  • 42 Ned S // Jul 3, 2010 at 4:23 am

    Not looking quite as scarey as it did two hours ago though! Yeh, I can see your logic with avoiding the AUD.

  • 43 Anon // Jul 3, 2010 at 4:36 am

    DJIA is at the bottom extreme of the bollinger bands. Lets see it bounce!
    Volume not materially and consecutively below the DMA.
    This bearish volume trigger was firing at ~11,000 and ~10,600, altho becomes abit useless at the bottom of a correction.
    No doubt when we come out of this it we may have periods of declining volume which will then become a bullish indicator. I’ve noticed alot of people use declining volume out of corrections as a bearish indicator…but its not relevant for the first several months out of a correction i’ve found (not including bear markets of course).

    *All posts by this poster is not financial advice

  • 44 Anon // Jul 3, 2010 at 4:39 am

    End the day up Ned?
    Looks like funds are buying heavily everytime we get near 9,600.

    *All posts by this poster is not financial advice

  • 45 Anon // Jul 3, 2010 at 4:53 am

    My Teacher: Charlie Munger

    http://blog.enochko.com/2010/06/my-teacher-charlie-munger-english.html

    *All posts by this poster is not financial advice

  • 46 Ned S // Jul 3, 2010 at 5:13 am

    “End the day up Ned?” – Was line ball there until right at the end. And definitely could have been way worse. The occasional mega bear has started screaming for the end of the world again I see – SP500 sub 500 etc. Must admit I’ll be very happy to see them disappointed! :)

  • 47 Anon // Jul 3, 2010 at 6:32 am

    lol Ned, its the samething every bottom unfortunately! It gets abit tiring listening to it.
    Price Action looks like big buying is occuring so that is what it is. This has happened last 2 days.

    I’m seeing alot of traders net shorts atm, trying to stay with the trend…almost analogous to what was happening with the EURO shorts crowded trade. Might not be pretty when the shorts get squeezed.

    *All posts by this poster is not financial advice

  • 48 Greg Atkinson // Jul 3, 2010 at 8:40 am

    It is going to be interesting how Australia stocks hold up if commodities prices soften. Personally I think the mining stocks are already trading at a level where a fall in commodities prices is factored in. They are certainly not trading at “mining boom” levels.

    But I don’t expect the ASX All Ords/ASX to fall much further. In fact I reckon it is oversold again. But I do wish the BDI would pick up again!

  • 49 Ned S // Jul 3, 2010 at 11:40 am

    I saw your tweet on the BDI Greg. And then went and read that the shippers are all bullish and building more. Followed by a comment that the shippers have been known to be abysmally wrong in the past.

    Yep, there were motivated buyers at djia 9,620 alright Anon. I guess I don’t like the fact that 9,800 didn’t hold though?

    The thought crossed my mind a good while back that everyone could save themselves a lot of effort and angst if the markets were only open between 10:00 and 10:15 AM and 3:45 and 4:00 PM. Maybe it’s just that the Wall Street types need something to fill in their day while the kids are at school? :)

  • 50 Anon // Jul 3, 2010 at 11:44 am

    So do I…BDI looks sick as a dog…hopefully we’ll see a pickup soon.

    Just re-looking at the XAO charts…and entertaining the thought of a further flash down to take out the weak hands. Perhaps a possibility to around ~4110ish in a worst case scenario. But if it got there i’d think this level wouldn’t last very long. And to play for the last 2% or so seems abit silly when theres 20%+ possible upside?

    If we break 4,000 this is not good and it means we are in a bear market (>20% falls). If that happened i’d need to reassess everything and would probably sell on the counter-trend relief rally (10-15%). But I really cant see a bear market situation here, so thats all i’ll say on that ;)

    *All posts by this poster is not financial advice

  • 51 Anon // Jul 3, 2010 at 11:53 am

    Yeah ~9,800 broke…looks like 9,640 has to hold at closing not intraday, or else another flash drop might occur.
    We really dont want to keep going down like this or else we start getting towards bear market type situation.

  • 52 Greg Atkinson // Jul 3, 2010 at 2:16 pm

    Regarding the BDI there are a few things at play. Firstly a lot of ships are being delivered but this is largely because of orders placed before the GFC..especially for the big ships. On the other hand a large number of ships are being scrapped and many are laid-up.

    So from what I can tell the overall effect is that a lot of capacity is being taken out of the system and yet, the BDI remains weak.

    So I am very focused on watching the BDI at the moment and if it doesn’t pick up soon I reckon the Australian economy might be in for a tough second half.

    But I reckon a lot of bad news is already priced into stocks so I am not expecting any dramatic moves below 4000 for the ASX 200/ASX All Ords.

  • 53 Anon // Jul 4, 2010 at 12:08 am

    Geez my last two posts are becoming bearish…i’m letting the crowd get to me!

    Regarding the BDI agree with Greg…its shocking but stocks and resources…and in some cases ship related listed companies are reflecting this fact (and I would argue its now excessively priced in). Also the BDI is wildy volatile so I wouldn’t be surprised that we get a huge rally back up in the next few months. Look at the BDI ~Sept 09 correction and rebound.
    Theres clearly going to be a disconnect here between what the economy and stocks will do. Even if we have a slowdown in growth its unlikely to be a recession. And historically its normal to have these slowdowns comming out of deep recessions etc. Again, how is it possible to have recessionary level stock prices yet no recession? Looks like everyone is preparing for the end of the world again and I think its mainly an over reaction due to the many burnt wounds from the horrible GFC.
    But we’ve got to start seeing stocks move higher on bad news…that will be a key turning point, in regards to a bottom. Usually at bottoms, you get bad news after bad and the market reacts less and less, until it begins to rise on the bad news. Similarly the opposite occurs at a market top…good news after good but the market doesn’t move.

    *All posts by this poster is not financial advice

  • 54 Anon // Jul 5, 2010 at 10:08 am

    Am I going crazy or does Telstra look like its about to rocket?
    The charts look interesting…who would have thought this decade long dog would move?
    I guess you cant get more bearish on it than now?
    Almost everyone hates it…the recent government deal superficially looks good re BBN but need to look at it more. Yield is at ~9% and with the deal looks like they should be able to maintain the divvie.
    Interesting!

  • 55 Anon // Jul 5, 2010 at 8:15 pm

    Well XAO down? Wonder what the DJIA will do tonight?

    *All posts by this poster is not financial advice or a reccomendation to do something.
    Diclosure: Poster may own positions in some of the ideas discussed in some/all posts.

  • 56 Greg Atkinson // Jul 6, 2010 at 9:29 am

    Well the rumblings of a property bubble in China are growing louder and more analysts/economists seem to be suggesting that the Chinese economy is going to slow down. But by how much? Even it is grows at ‘only” 9% that is still fantastic, but maybe Australia has become hooked on double digit growth in China?

    You know I reckon Rio Tinto and BHP sense prices for iron ore and coal are going to fall and that is why they have agreed to the revised terms of the mining tax.

    A budget surplus in 2013?…I don’t think so.

  • 57 Anon // Jul 6, 2010 at 9:30 am

    This is like groundhog day..waste of time even bothering to look
    Telstra is bucking the trend

    *All posts by this poster is not financial advice or a reccomendation to do something.
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  • 58 Anon // Jul 6, 2010 at 9:44 am

    “A budget surplus in 2013?…I don’t think so.”

    Yeah I didn’t buy that either lol.
    Can’t be worse than Rudd…at least she got the deal done.

  • 59 Ned S // Jul 6, 2010 at 10:25 am

    “Can’t be worse than Rudd…at least she got the deal done” – Yeh, definitely better than leaving it in abeyance because one was freaked out by the thought of doing another obvious backflip anytime soon. But no system to it – No thought behind it – Just a matter of how do I save a bit of face and maybe extract a bit more tax revenue from the system. More ad hoc patchy bandaid sort of stuff from a mob that has no idea what it is doing or how to do anything.

  • 60 Ned S // Jul 6, 2010 at 3:55 pm

    Jeez, what happened – Did China announce it’s going to indulge in QE or some such? :)

  • 61 Greg Atkinson // Jul 6, 2010 at 4:58 pm

    The balance of trade numbers made people happy, but I am guessing a lot of this has to do with the AUD getting weaker. I am not sure if I should be pleased or if this is the last gasp of the commodities boom for a while.

  • 62 Ned S // Jul 6, 2010 at 6:45 pm

    Thanks Greg. And I see our intrepid inflation fighting mates at the RBA didn’t feel to give me a pay rise on my cash holdings this month! :)

  • 63 Anon // Jul 6, 2010 at 7:23 pm

    Well i’d say this looks like a bottom candle…but then i’ve been saying that for the last week and i’m starting to look stupid.
    So I will remain cautiously optimistic ;)
    Could be a big short squeeze here.

    *All posts by this poster is not financial advice or a reccomendation to do something.
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  • 64 Ned S // Jul 6, 2010 at 7:48 pm

    I reckoned Oz house prices have been a bit high for the last 5 years Anon. (Not that it stopped me buying two of them.) So if you call a stock market turn within a week, I’ll be extremely impressed! :)

  • 65 Anon // Jul 6, 2010 at 8:08 pm

    Thanks Ned.
    Hopefully the states will have a nice rally tonight. Futures appear to be kicking along ;)

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  • 66 Ned S // Jul 6, 2010 at 9:21 pm

    It’s a funny one Anon – Krugman is talking about the start of the “third depression” – He’s a bit worried about stimulus being withdrawn I gather. While Roubini is saying, Nah the US won’t see a double dip – But it’s gunna be tough going. It probably is about time for the market to turn around and give all the bears a fright though?

  • 67 Anon // Jul 6, 2010 at 11:21 pm

    Yep, let the bullrun begin ;).
    Yeah Roubini sounds closer to the mark, but the markets are pricing in a recession, not a slowing in the economy…so stocks should do ok this year.
    Krugman sounds abit extreme so thats all i’ll say on Krug. And most depressionists comeout at market bottoms.

    “Despite talk of meltdowns, it’s important to point out that corrections are common. Going back to 1928, the S&P 500 has suffered 93 corrections, says Ned Davis Research. They typically occur every 234 trading days, on average, or every 12 months.”

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  • 68 Anon // Jul 6, 2010 at 11:45 pm

    Thought this was brilliant in terms of listening to others. I’ve been trying to do this for awhile but its very difficult to do.

    “We generate ideas from a global macro prejudice and then filter them through a global macro prism. Let me give you an example. I read research by people such as Marc Faber. Marc is wonderful, but I have to read him through the prism of sheet music. Charts are my sheet music; Faber is my Mozart. However, by putting his thoughts and prejudices through a different medium I can raise or lower the volume of Marc and the others. Right now I’ve got the volume on Marc and people like James Grant turned low; not because I disrespect them but because they are currently in conflict with my disciplines, my sheet music, and with my understanding of how to make money.”

    From Drobny – Invisible Hands.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 69 Anon // Jul 6, 2010 at 11:58 pm

    EUR/USD continues to run. Now the key will be not to sell too bloody early, which is a mistake I am continuously doing. If I even sell 1% before 1.33 someone shoot me.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 70 Anon // Jul 7, 2010 at 12:46 am

    Bullish signs for the EURO:

    Euro’s Worst to Come, Top Analysts Say
    http://www.bloomberg.com/news/2010-07-05/euro-worst-to-come-for-most-accurate-analysts-as-td-securities-sees-parity.html

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 71 Anon // Jul 7, 2010 at 3:21 am

    djia gains out the window…how volatile is this bottom. Almost as bad as the BP one.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 72 Ned S // Jul 7, 2010 at 4:01 am

    Yeh, they’re tricky little devils those Yanks. I wouldn’t have any idea what they are going to get up to in the last hour.

    I guess I’m just a bit negative on the Western world situation generally. I figure I’ve maybe got 30 more years to live. And within that timeframe I don’t especially see the changing world demographics as being a plus. And I’ve got this nasty thought in my head that as George Bush’s “a rising tide raises all boats” theory hasn’t necessarily worked out well in practice, the West could be in for a rather disappointing time as it learns to compete with Asia. Their expectations are lower. And they just haven’t got all our ideas about what they figure they should have the right to vote themselves as entitlements under their governments perhaps?

    But trading is a totally different matter if one can make a buck from it. Apart from that, one is down to relying on inflation I guess.

  • 73 Ned S // Jul 7, 2010 at 5:04 am

    Looked like a win to me! :) With the best bit being it never really got close to 9,620 maybe?

  • 74 Anon // Jul 7, 2010 at 5:59 am

    Yeah looks good, but we can never be certain in this game. Am constantly belted to the floor everytime I get a hint of overconfidence.

  • 75 Anon // Jul 7, 2010 at 6:26 am

    What are your thoughts on China Ned?
    I’m looking at some stuff…entertaining some ideas.
    It appears to me China is a leveraged play on the US economy and Australia is a leveraged play on China. So this decoupling thing has me confused?
    If US saves more…which seems to be already occuring…then China is in trouble, followed by Australia.
    If you overlay the MSCI Asia chart with a chart from 2000 of US debt to gdp theres a big correlation.
    “By doubling up on yet more productive capacity and yet more office buildings and yet more fast trains and the like, [China] have financially exposed themselves. For the first time in two decades they are very vulnerable. If I am right and Western economies enjoy subdued economic growth at best, then all of us will be swimming in deflation. The price of Chinese and indeed all internationally traded goods like steel will need to come down to a level where, despite our misgivings and our collective desire to run down debt, their stuff is just so incredibly cheap that we would definitely consume more.”
    *Anonymous Hedgefund manager Invisible Hands.

    Happy to hear the other side of the coin of course…i’m guessing theres lots of differing views here.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 76 Anon // Jul 7, 2010 at 6:39 am

    Seems like the market is confused re: deflation or inflation…and to be honest…I am aswell!

  • 77 Anon // Jul 7, 2010 at 9:23 am

    Well bght somemore high dividend yielding stocks again. Beats the bank and wouldn’t be surprised if the RBA is on hold for awhile – only encouraging more people to go after yield ;) Wonder how long 10% yields can last?

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 78 Ned S // Jul 7, 2010 at 6:09 pm

    My thoughts on China (or more generally Asia) – It would just seem incredible to me if the region can’t out compete the West Anon. Leastways in a world that remains ‘coupled’. And I can’t exactly see Americans (as the archetypal western consumer) being in any hurry to go back to producing their own levis in sweatshops for 10 bucks a day – So the incentive to decouple is not strong. But that still begs the question of what the heck is the west going to do for a living.

    The Americans have been able to borrow money – They’ll ‘die in a ditch’ before they willingly see the USD lose global reserve currency status I imagine? As for the others, they seem to have decided austerity is worth a shot. But the Chinese presumably aren’t too silly – They got through the Asian Financial Crisis OK. I’d love to know what’s going through their minds as they play around with their currency peg and decide whose bonds to buy.

  • 79 Ned S // Jul 7, 2010 at 7:33 pm

    “deflation or inflation” – This bloke gives a reasonable assessment on it here Anon:

    http://www.nakedcapitalism.com/2010/06/satyajit-das-nowhere-to-run-nowhere-to-hide.html

    With the extra thing to bear in mind maybe being that if the patsies catch on that inflation is a happening thing, then its value to governments is significantly reduced.

  • 80 Anon // Jul 7, 2010 at 11:33 pm

    Thanks for the article Ned, looks good…i’ll take a read of it over the next couple of days as it looks like something I need to seriously absorb.

    Looks like the states is moving again…wonder what the Advance/decline reading is?

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 81 Anon // Jul 8, 2010 at 1:32 am

    Dumping BP here…close to breakeven so wont push my luck and get out of something that was clearly a mistake. May go higher but other things I can get even better returns on now with much less risk.
    Will look at it again when its out of the headlines and the full extent of liability is known.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 82 Anon // Jul 8, 2010 at 1:41 am

    Buying BDX…looks interesting.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 83 Anon // Jul 8, 2010 at 1:54 am

    Eyeing the Cable (GBP) but unsure about entry hmm.

  • 84 Ned S // Jul 8, 2010 at 2:19 am

    And I’ve been trawling (or should I say trolling?) house prices and saying a couple of them could be worth asking a few questions about. :)

  • 85 Anon // Jul 8, 2010 at 3:02 am

    Bght some long dated BP calls incase I am wrong. But risk has been substantially cut aswell as giving up some of the upside. Gotta manage risk and worry about downside before caring about how far it will go.

    Ahh Ned the troller ;) Are the prices in your areas of interest begining to fall? Or at least sellers willing to move on price?
    Re: house prices, i’m starting to plan for shorting the housing market, but still not sure how to do it…might play the interest rate spread or short banks or bonds or abit of everything ;).

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 86 Ned S // Jul 8, 2010 at 3:52 am

    Djia very nicely above 9,800 again. Good – Providing it stays above that I’m happy enough to accept the end of the world is not yet upon us! :)

    Housing – Just at a quick look I’d say maybe a few investors want out. But the mortgage belt stuff isn’t offering anything attractive price wise – Although there is certainly a lot of stock there.

    Shorting (trading) the housing market – A while back the ASX and Rismark were talking about putting something together for those purposes. Not at all sure if anything has come of it yet.

  • 87 Anon // Jul 8, 2010 at 4:04 am

    Yep 9,800 has been breached. Good to see you’re not falling for all the bearish propaganda Ned ;) I’ll turn up the volume on all these bears if markets get expensive again tho.

    This is my somewhat inaccurate simplistic assesment of whats happening now:

    Crash
    Recovery, everyone buys gold and heads into bunkers, gets shotguns. Pray to Allah
    Bottom is in, while dust settles retail investors sell the bottom and prepare for the end of the world.
    Huge rally, retail investors realise they missed out jump into the top again.
    Big correction – retail investors panic sell quickly before losses accumulate. The masses think its 08 all over again because its just happened so it must happen again !
    Rally again – Retail investors stay out doubting the rally.
    Rally Tops out…retail investors buy in thinking..i’m definitely not panic selling again given I got tricked last correction!
    Crash begins…retail investors hold on thinking its a “correction” and then get wiped out.
    Rinse and repeat!

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 88 Anon // Jul 8, 2010 at 4:16 am

    Well i’m done, can hopefully leave things for awhile now ! This sounds eerily familiar? Another drawdown comming? lol hope not

    Just need to control overcondfidence and remain grounded, which is really difficult to do.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 89 Anon // Jul 8, 2010 at 4:32 am

    On a serious note, I hope we didn’t lose too many stock market participants during this correction.
    Sometimes the line between losing alot or losing alittle can be one or two decisions that takes 5 minutes to decide/research.
    Looking at how far alot of these stocks have fallen, I’m abit worried about how many people are hurting out there :( Losing money is not fun and we’ve all experienced it before.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 90 Anon // Jul 8, 2010 at 5:01 am

    Well close above 10,000 Ned! Didn’t think that was going to happen.

    The media bears are going on about rally on low volume again lol. Low volume comming out of a correction = bullish!

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 91 Ned S // Jul 8, 2010 at 5:39 am

    “close above 10,000″ – As you said very recently Anon, the market is nothing if not volatile!

  • 92 Anon // Jul 8, 2010 at 6:44 am

    Well lets hope the portfolio runs on autopilot from here. Time to relax ;)

  • 93 Biker // Jul 8, 2010 at 9:51 am

    “Re: house prices, i’m starting to plan for shorting the housing market, but still not sure how to do it…might play the interest rate spread or short banks or bonds or abit of everything ;) .”

    Please keep us advised. Clearly you know something we don’t!~

  • 94 Anon // Jul 8, 2010 at 10:53 am

    Hey Biker, not sure if you are pulling my leg or being serious ;) Hard to tell !

    The plan for my bet against housing is around 2011-2012 and of course this is not financial advice. But this is purely a guessing game and I could be completely wrong.

    *All posts by this poster is not financial advce or a reccomendation to do something. Always seek financial advice before making financial decisions.

  • 95 Biker // Jul 8, 2010 at 2:36 pm

    “…The plan for my bet against housing is around 2011-2012…”

    No, I’m always very interested in the basis for any worst-case-scenario, Anon. We need to know what’s ahead in case a Black Swan crosses our path.

    I can visualise a minor correction on the east coast, but all the indicators tell us the west coast will fly in those years. Despite that, we’re in holding pattern. We’ve cast so much bread upon the water that the appearance of a rogue Black Swan could be unavoidable!~ :)

  • 96 Ned S // Jul 8, 2010 at 2:48 pm

    Hey Biker, what do you reckon about that idea of trading Oz residential RE housing indices on the ASX? Sounds like it could have some advantages – No tenants to give a bloke grief; Don’t have to share any of the rent with the likes of management agents or local city councils or tradies (because there is no rent I guess – Bit of a bummer that but what the heck, they don’t earn much rent anyway); Could still do all the neg gearing stuff I assume – Just like any investment; But a bloke wouldn’t get to claim depreciation like he does on real housing; Although all the rent and depreciation type considerations would be reflected in the indices one was trading that are based on real housing anyway; Oh, and there’d be none of the current hassles re liquidity or needing to save up a deposit to participate. Lots of pros and maybe not too many negatives perhaps? :)

  • 97 Biker Pete // Jul 8, 2010 at 6:48 pm

    In a sense it removes that most comforting aspect of property, Ned… the ability to run my hands thru’ the soil, touch up a fleck of render, tighten a gate screw. It’s the ‘tangibility’ I need!~ There’s no weekend worry about what Yank traders might be up to on the weekend, no anxiety when the ASX is crashing down through the barriers, no need to consider catching falling cutlery, no fear of dirty bankers or rogue boards! Best of all, we know a great deal about our specialist area(s).

    Tenants haven’t really ever been an issue. One of our rental agents, Ray Whites, screens tenants very well. Their rates are fair and reasonable. Our other agent costs us _twice_ as much… and, we suspect, has sweetheart deals with tradies.

    We actually enjoy the hands-on aspects of property. It’s good fun, keeps us out of mischief… and it gives us a real thrill to get a new place up-to-spec. If we ever sold up, life really wouldn’t be the same… . :)

  • 98 Vince L // Jul 8, 2010 at 9:57 pm

    You guys do get what this discussion is about right? The “stock market”. There is another area where house prices are discussed.

  • 99 Ned S // Jul 8, 2010 at 10:15 pm

    I’m a ‘bloke’ actually Vince, ta – Yanks have guys ‘n gals – Whereas Aussies have blokes and the gender we are too scared to put a name on anymore in case we offend any of them! :)

  • 100 Ned S // Jul 9, 2010 at 1:32 am

    It doesn’t look like anyone has told the BDI it’s going the wrong way yet.

  • 101 Anon // Jul 9, 2010 at 4:25 am

    BDI is not tracking that well lately is it Ned.
    Its correlation is pretty good with equities over a longer period of time – but damn is it volatile! Not sure how the correlation will hold up over the next 6 months…so far its not tracking well on a short duration basis. My bet is the correlation will decouple, especially if there is a divergence between equities performance and the economy. But as always could be completely wrong.

    Heres some stuff I found on deflation: Adds more confusion to our already confused thoughts:

    “We think the downtrend in real yields will continue as baby boomers increasingly look to safe places for their savings. The samething happened in Japan in the 1990s. Demographically, the United States is 10 to 15 years behind Japan and the same dynamic is playing out.
    The path of least resistance for the United States is to go down the deflation path, preferably some mild version where debtors can actually service their debts. Hyperinflation is not a choice. There is no country that has ever inflated its way out of a debt problem with a financial economy as large as the United States’–the 1970s not to the contrary, because the economy wasn’t nearly as financialized then.
    What was arguably better about the Japanese tragectory was that it created no consumer credit bubbles. American consumers are going to have to retrench the spending that makes up two-thirds of the economy. If these consumer credit bubbles unwind in the United States, deflation is likely to be much stronger than it has been in Japan.”

    This was predicted in 2006 btw.
    By Hedgefund manager Peter Thiel, former founder and ceo of Paypal and owner of Clarium Capital.

    Atm i’m starting to lean towards intermediate deflation…and then eventual inflation…although excessive inflation could be years away especially as governments begin to try and cut back stimulus.
    Then again we could all be wrong and just have normal levels of inflation for the next several years. In forecasting you are generally wrong more than you are right and I’ve been wrong many times.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 102 Anon // Jul 9, 2010 at 4:40 am

    BP continues to rise…lucky I bght those calls in case I was wrong…because I was!

    *All posts by this poster is not financial advce or a reccomendation to do something. Always seek financial advice before making financial decisions.

  • 103 Anon // Jul 9, 2010 at 4:44 am

    You are right Vince…we will try and stay on topic re: stocks.

  • 104 Anon // Jul 9, 2010 at 5:03 am

    Markets continue to rally…not sure why Walmart is not moving much given the good retail data and improving market conditions. Only concern I have is some management changes, which is usually a prelude to a downgrade. But its hard to fault a company that has increased eps for decades…so I wont make that bet (for now anyways). Also it appears Buffet has previously bght below 50$ from interpretation of his publicly released 13f filings. In addition Buffet has publicly disclosed he topped up his Tesco holdings recently, which gives bigger weight to the possibility he topped up his Walmart stock (both retailers) – which would inturn give a boost to the stock price if released. Although purely guessing and could be wrong.

    Additionally the longer stocks move sideways generally the bigger the rise when it breaks out. And this is been going sideways for 10 years!

  • 105 Anon // Jul 9, 2010 at 5:10 am

    EUR/USD has broken 1.27…looking for 1.35.
    Numerous people trying to short it which makes this more bullish as this happens alot on a breakout as people doubt the rise!

    *All posts by this poster is not financial advce or a reccomendation to do something. Always seek financial advice before making financial decisions.

  • 106 Anon // Jul 9, 2010 at 5:23 am

    US consumers continue to unwind debt:

    “The $9.1 billion decrease followed a revised $14.9 billion slump in April that was initially estimated as a $1 billion increase, the Federal Reserve reported today in Washington. Economists projected a $2.3 billion drop in the May measure of credit card debt and non-revolving loans, according to a Bloomberg News survey of 34 economists.

    Borrowing that’s increased twice since the end of 2008 shows consumer spending, which accounts for about 70 percent of the economy, will be restrained as Americans pay down debt. Banks also continue to restrict lending following the collapse of the housing market, Fed officials said after their policy meeting last month.

    “Consumers are loathe to take out additional credit as the tight labor market is making it hard to get a job or maybe even keep one,” Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, said before the report.””

    Walmart should benefit in a less frugal environment, having lowest prices. Looks like the consumers that Walmart picked up in the recession may not be willing to go back to bigger spending habbits than most analysts projected earlier in the year. Nice big catalyst?

    Looks like Peter Thiels predictions, back in 2006, are slowly comming to fruition!

    *All posts by this poster is not financial advce or a reccomendation to do something. Always seek financial advice before making financial decisions.

  • 107 Anon // Jul 9, 2010 at 5:56 am

    Dumping AUD/USD longs here. Might go higher but prefer to taketh what the market giveth ;)
    Its above fair value now and that is what it is.
    Suspect AUD/USD might be in a very slow/drawn out downward moving trading range for awhile…the big moves have occured this year imho – might not see any decent action till mid to late 2011?

    Buying GBP/AUD 20% of position as not sure where this is going to bottom out…especially if it moves down and equities move up. Looks like pound may make a big move up sometime this year as the government becomes less nutty.

    *All posts by this poster is not financial advce or a reccomendation to do something. Always seek financial advice before making financial decisions.

  • 108 Anon // Jul 9, 2010 at 8:15 am

    Looks like this rally may have legs – crowd is excessively bearish:

    “Bullish sentiment fell 3.7 percentage points to 20.9% in the latest AAII Sentiment Survey. The proportion of individual investors who expect stocks to rise over the next six months is at its lowest level since March 5, 2009. The historical average is 39%.

    Neutral sentiment, expectations that stocks will stay essentially flat over the next six months, fell 11.3 percentage points to 22.0%. This is the first decline in neutral sentiment in six weeks. The historical average is 31%.

    Bearish sentiment, expectations that stocks will fall over the next six months, surged 15.1 percentage points to 57.1%. This is the 15th highest level reading for bearish sentiment since the survey started in 1987. The historical average is 30%.”

    http://blogs.forbes.com/investor/2010/07/08/bearish-sentiment-surges/

    This indicator tends to only work best at extremes…looks pretty extreme to me !

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 109 Ned S // Jul 9, 2010 at 7:47 pm

    I can only assume you are using ‘we’ in the royal pronoun sense when you say “You are right Vince…we will try and stay on topic re: stocks” Anon me ole bean?

    ‘Cause my thoughts run way more along the lines of: “Tough titties!!!” :)

  • 110 Anon // Jul 10, 2010 at 12:37 am

    “– Buffett disagrees with The New York Times economist Paul Krugman that the nation is in the early stages of another depression. Buffett says he has “enormous confidence” in the country’s economic future. He says the stimulus is working and the economy will improve in the next 2-3 years.”

    Its interesting to also note Buffets father told him to wait around the time he first started to invest.
    His father thought the USD was history and he was buying gold and preparing for the end of the world…back in the 1950s….I looked back and noticed people were doing this in 1974-5 and early 80s and 1987-88 and early 1990s. Its almost a contrarian signal to go long?
    Also Jim Rogers said America was history and he would short it back in 1995…aswell he said in 1987-8 that a depression might occur. I think he did the same back in late 2008 or early 2009 from memory?
    Looks like the doomists are a signal a recovery is underway and returns will be at least reasonable from these levels !

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 111 Anon // Jul 10, 2010 at 12:42 am

    Although not sure I could handle the known risks if we were above 5,000, unless material things had changed.

    *All posts by this poster is not financial advice or a reccomendation to do something.

  • 112 Anon // Jul 10, 2010 at 2:44 am

    “Also it appears Buffet has previously bght below 50$ from interpretation of his publicly released 13f filings.”

    Actually thats not 50$ its 52.56 (average price from highs and lows that quarter). Not a great guess but its all we’ve got to go by. Dont get exact entry prices unfortunately !

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 113 Anon // Jul 11, 2010 at 2:02 am

    Been trying to work out where we might go from here…
    Looks like we might be ok till about September and then another significant drawdown possibly, altho the lows now should comfortably hold….so higher low pullback or at best sideways during sept/oct? Statistically unlikely to go lower than we’ve just been, given the extent of the correction thus far.
    I’m seeing some possible future breakout setups forming on things I use to hedge downside risk. So clearly another shakeout comming in a few months if the patterns play out. These things are still in their early stages though.
    After September/Oct, looks like we should go towards recent highs; if not create slightly new highs by end of Dec 2010.
    Then perhaps a continuation into Jan/Feburary. Given we’ve crashed/corrected in January last 2 years in a row I’d suspect the bullmarket to keep powering higher into early 2011. Perhaps a topout @ 5,500 or so in Feb 2011? Possibly a correction in May and then a much slower several month lower low tanking process. So >20% falls over perhaps 6 months….the craziness and sharpness of the crashes weve experienced last few years makes it more likely any bearmarket or crash will be alot slower in 2011. Anyways, just ideas based on gut feel and could change as things change.

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 114 Anon // Jul 11, 2010 at 3:27 am

    When I mentioned the craziness and sharpess of the crashes last few years, I was talking specifically about the multiple crashes in 2008 and 2009 and the correction in 2010. Just unreal speed at which these things occured. Historically theres alot of falls that may fall like early 2008, 2009 and 2010 but at a much slower pace.

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 115 Anon // Jul 11, 2010 at 1:57 pm

    Forgot to mention am long aussie banks.
    Looking cheap and the credit issues are still awhile off. Lower house prices take awhile to filter down into loan losses….so the bears will have to wait!

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 116 Ned S // Jul 11, 2010 at 8:29 pm

    They are sitting on a pretty respectable whack of deposits Anon:

    “Total deposits in all Australian banks now top $1.26 trillion.”

    http://www.theaustralian.com.au/business/cash-is-king-for-investors-around-the-world/story-e6frg8zx-1225889998927

  • 117 Anon // Jul 12, 2010 at 7:04 am

    Geez Ned…huge amount of deposits. Lets pray alot of these deposits arn’t locked in at those crazy interest rates of a few months ago, or they’ll be losing money!
    Last time I saw the headlines “Cash is King” was in early 09 just before equities rallied significantly. Albeit stocks may not recover as quickly this time; but as the aritcle says theres alot of people on the sidelines which has generally been a good time to invest in equities.

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 118 Anon // Jul 13, 2010 at 2:19 am

    Adding to Euro/USD…will look to double my already sizeable position as it continues to correct in this intermediate uptrend.
    As George Soros says..when something is going your way and there is a high probability of it continuing “you can never be big enough.”

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 119 Anon // Jul 13, 2010 at 2:32 am

    Walmart now is 100% of my portfolio if I exercised my long dated calls. Each dollar it moves is moving my portfolio ~3% (to max 10% downside as my puts kick in). Not going to muck around here…going for the jugular!

    Been making too many bloody errors on position sizing i.e. ensuring when you make a kill you are all in. Separates poor performance from good imo – altho most freeze when they need to add, and add when they should be cutting )been guilty of this many times!)

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 120 Anon // Jul 13, 2010 at 2:42 am

    Getting 15:1 reward to risk across the whole portfolio. Thats just nuts ?
    Even though we might have a slight pullback/consolidation here, the market is just way undervalued imo.
    Pessimists be damned :P Now watch the market plummet lol.

    *All posts by this poster is not financial advce or a reccomendation to do something

  • 121 Anon // Jul 13, 2010 at 4:36 am

    Howard Ward, GAMCO growth fund:

    http://www.pbs.org/nbr/site/onair/transcripts/market_monitor_howard_ward_stock_picks_100709/

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 122 Anon // Jul 13, 2010 at 4:41 am

    Had alittle flutter on some ITM long dated calls for Alumina (AWC) a few weeks back and forgot I had them…lets see how the Alcoa earnings are? The street seems to be pessimistic which is generally a good sign? AA stock is not moving either which is a good sign perhaps? Or could be another shocker.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 123 Anon // Jul 13, 2010 at 6:15 am

    Record short levels on + low expectations for earnings season = markets to move higher over the never several weeks. Albeit I have no idea if we will fall for the next few days..could happen.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 124 Anon // Jul 14, 2010 at 2:26 am

    Markets are overbought…but this can easily become more overbought for several months. Usually big breakouts are in and stay in overbought territory and then you have all these retail investors trying to fade the rise. I wonder how many people got burnt trying to short the EURO?
    I trippled my EURO position overnight, on the pullback, so that my virtual fx positions are more than my entire portfolio. My stomach was not handling this size very well but I have to listen to my intuition and not pass up outliers!!
    Will look to dump EURO positions before the Sept/Oct possible correction.
    Looking to add to BP calls position on abit more of a pullback.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 125 Anon // Jul 14, 2010 at 5:36 am

    Bank of America on Friday…should beat given how low analyst expectations are and loan provisioning is at GFC type levels with no GFC. Another kicker for the market?
    Looking for a top around 4.700-4,800 then a pullback to maybe 4,400-4,500. Then retest back up to 4,700-4,800, followed by a drop in Sept/Oct of either consolidation between 4,500 and 4,700 or a correction back to 4,300-4,350 followed by a rally till Feb 2010 to 5,500.
    Looks bloody volatile, but lows should hold comfortably; so hold onto your seatbelts!
    Will just ride out the noise until September..no point trying to time those moves in between!

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 126 Greg Atkinson // Jul 15, 2010 at 1:57 pm

    I am a touch surprised that the ASX All Ords/ASX 200 are still fairly weak. We are being told that “all is well” and yet the market can’t even get through 4500. Something just doesn’t add up.

  • 127 Ned S // Jul 15, 2010 at 3:57 pm

    Have read two ballpark guesses that the world is only about halfway through its deleveraging process Greg.

    Give it another three years and we might know where we are at?

  • 128 Anon // Jul 15, 2010 at 5:06 pm

    Anyone see Nufarm today? Geez talk about timebomb :(
    Feel sorry for the people who got caught up in this disaster.
    I guess the warning signs were on the first downgrade; always more cockroaches in the kitchen.

    http://money.ninemsn.com.au/article.aspx?id=7930029

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 129 Ned S // Jul 15, 2010 at 5:32 pm

    One of the risks of selling brand name products to a market that doesn’t place a huge premium on the brand name I guess. It’s not like using Roundup as opposed to a generic glyphosphate would give the average farmer as big a thrill as wearing an Armani handbag as opposed to a Bags Are Us one might give his missus maybe?

  • 130 Anon // Jul 15, 2010 at 6:11 pm

    Yep thats a good analogy Ned ;)

  • 131 Ned S // Jul 15, 2010 at 6:24 pm

    Remember one of the other principals I picked out of some general reading once that I suspected could be of use at some time re investing Anon? :- It went along the lines that in WWII the Soviet tanks were crap – But what did they care when they were going to be scrap iron within 3 engagements. Whereas the poor old Germans just couldn’t produce enough of their high precision masterpieces of the manufacturer’s art to keep up.

  • 132 Greg Atkinson // Jul 15, 2010 at 10:32 pm

    Ned for Oz I think 2011 might be a little tough simply because I think commodities prices and demand have hit a cyclical peak. But heck I have been worrying about that since last 2009 so maybe I should just keep a low profile ;)

  • 133 Ned S // Jul 15, 2010 at 11:25 pm

    Bearish calls that turn out to be ‘right’ are usually made too early from what I’ve seen of it Greg. With the blokes who can see the genuine reasons feeling they are so obvious that everyone else must be able to see them too and will presumably react I guess?

    About all I’m ‘seeing’ is inflation in the basics in Oz. Food, energy, insurance, government charges. Whilst stock prices have done what they’ve done. And that house prices may well have corrected if it hadn’t been for emergency interest rates and the FHOG.

    A tricky one would be to get inflation in consumables and deflation in asset prices. And perhaps it isn’t out of the question – A weak AUD coupled with/caused by poor demand for our exports could do it I guess.

  • 134 Anon // Jul 16, 2010 at 1:06 am

    “Bearish calls that turn out to be ‘right’ are usually made too early from what I’ve seen of it Greg”

    Thats so true Ned….i listen to alot of bears but am generally different in duration and sometimes extremity.
    Soros agrees with us re: 2011 bear market and a few other hedgefund managers are targeting 2011. Maybe around the back half of 2011?

    The BDI just looks the sickest i’ve ever seen it in along time. Greg has reason to be concerned. If it doesn’t hold here, it might restest the 2009 lows! Lets hope it finds support here and then bounces (my gut feeling is we should bounce).

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 135 Ned S // Jul 16, 2010 at 1:26 am

    Seeing I failed miserably on letting you stock market types know that the KHR had some tax implications for the Oz miners (I assumed it was commonly known), I’ll see if I can do better on this one:

    Lots (all?) of Bush’s tax cuts are set to expire after 2010 apparently. With a couple of possible interest to stock market people being the CGT and Dividends Tax I’d imagine. While I haven’t confirmed it, I have seen it mentioned that they both reset on 1 Jan 2011 (unless Obama’s lot figure that would not be desirable between now and then I guess):

    “Higher tax rates on savers and investors. The capital gains tax will rise from 15 percent
    this year to 20 percent in 2011. The dividends tax will rise from 15 percent this year to 39.6
    percent in 2011. These rates will rise another 3.8 percent in 2013.”

    http://illinoisreview.typepad.com/illinoisreview/2010/07/first-wave-of-obama-tax-hikes-to-hit-january-2011.html

  • 136 Anon // Jul 16, 2010 at 1:45 am

    Geez thats a catalyst right there. Thanks Ned, i’ve noted it down.
    I’ve noticed markets sometimes go the wrong way with big events. But i’m starting to understand its the big boys pushing prices up for a few months, so they can dump and get out. Might see that in January/Feb if your tax calls are correct?

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 137 Anon // Jul 16, 2010 at 1:59 am

    Interesting stat and a reason why I’m bullish for Jan 2011 on the XAO.
    Last 3 Januarys (2008,2009,2010) have had corrections occur. Since 1980 the XAO has not had 4 substantial January corrections ever. I’m going to backtest it further out aswell, but suspect the samething will occur. So i’m not betting on a down month in January as its statistically unlikely. Might aswell go to the casino !

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 138 Anon // Jul 16, 2010 at 3:00 am

    Also for the SPX that stat holds, re: statistically unlikely for 4 consecutive corrections in January. Going to test it back to the early 1900s though as only used a 30 year data set.

    DJIA looks like its consolidating nicely before the next run, and the Asx may follow suit given the correlation?

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 139 Anon // Jul 16, 2010 at 5:34 am

    Goldman Raises Forecast for Euro

    “The bank now sees the common currency rebounding to $1.35 in six months and $1.38 in 12 months”

    http://online.wsj.com/article/SB10001424052748703722804575369293463896992.html?mod=googlenews_wsj

    Euro has been a leading indicator for the XAO, for now anyways. So should be interesting to see what happens with the XAO next week and if this correlation persists.

    My post on July 9th:
    “EUR/USD has broken 1.27…looking for 1.35.”

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 140 Anon // Jul 16, 2010 at 10:17 am

    Re: EUR/USD, 1.35-1.40 is about in line with where the 200dma would be hence my guess on July 9. Saw awhile back that the EUR.USD has gotten near the 200dma on similar intermediate counter-trends following big crashes. Almost gave up on this pattern playing out again, but it looks like this correlation is holding (thank christ).

    Retail Sales Sluggish:
    http://scottgrannis.blogspot.com/2010/07/retail-sales-sluggish.html

    Dr Copper says the patient is fine:
    http://scottgrannis.blogspot.com/2010/07/dr-copper-says-patient-is-fine.html

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 141 Ned S // Jul 16, 2010 at 4:16 pm

    “But i’m starting to understand its the big boys pushing prices up for a few months, so they can dump and get out.” – Pump and dump as they say.

    The BDI – Yep, a U-turn right about now would be a good sign.

    The Americans voted in some new regs re Financials I see – Guess we should know soon enough whether it changes anything via the market’s response. Although I find it a bit difficult to imagine they’d do anything that has teeth.

    One concern is that while the Djia is only down 25% from its peak, the All Ords is down 35%. And the SSE is all a bit sad. That isn’t especially indicative of a recovery based in Asia to my way of thinking?

  • 142 Anon // Jul 17, 2010 at 2:34 am

    “The Americans voted in some new regs re Financials I see – Guess we should know soon enough whether it changes anything via the market’s response. Although I find it a bit difficult to imagine they’d do anything that has teeth.”

    Yeah I had a quick look and given the price falls and still huge provisioning for bad loans its not going to make much difference. Also the prop trading desks of most banks, you would guess, must have made a killing with all this volatility; so profits should be boosted by that let alone the enivitable less provisioning. I think theres a wind bank of prop trading from banks re: not using their own money. But the timeline for that windback is years and shareholders still may make money from the spinoffs that would occur.
    So you are correct, they won’t do anything with teeth !

    “One concern is that while the Djia is only down 25% from its peak, the All Ords is down 35%. And the SSE is all a bit sad. That isn’t especially indicative of a recovery based in Asia to my way of thinking?”

    Markets can be leading and lagging indicators…Leading at first…but then as panic selling sets in…going too far and over compensating for the known risks.
    My feeling is Asia is slowing but the markets are over reacting and pricing in a complete collapse in the Asian growth story. There could be an additional discount for the extent of our housing bubble.
    TBH i’m alittle concerned with our markets if the Aussie housing bubble implodes and the Asian story takes a breather at the sametime(long term we all know its great). But this could be a few years out, so I guess onwards and upwards for the moment at least! I try to separate my longterm bias from my investing and trading unless price action is confirming.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 143 Ned S // Jul 17, 2010 at 3:27 am

    Another exciting close coming up Anon – And on a bit of volume by the looks.

  • 144 Anon // Jul 17, 2010 at 3:39 am

    Yeah the more volume the better, means panic selling is occuring ;) Albeit if that volume occured at a much higher level I would be concerned.
    I’ve been adding to my EUR.USD position as the strength is phenominal. My stomach is dying from holding this size but position sizing is everything…and if you dont load up when its going your way your performance will be poor.
    Looks like the XAO will follow suit on Monday and drop. Hopefully this correction will only hit the 10dma line (which the DJIA is about now) and bounce. If XAO/djia doesn’t hold here, then we might see a flash thru the 10dma and then a quick pullback. I’m seeing alot of price action that is indicative of accumulation occuring. And I know I have been buying ;)

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 145 Anon // Jul 17, 2010 at 3:54 am

    I was thinking about why the BDI is so stuffed. Could it be that China has bght way more commodities than they need short term so now they are in pullback mode? Therefore China is still powering along but they are using their excessive stockpiles? Which would make BDI unreliable?

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 146 Anon // Jul 17, 2010 at 4:01 am

    My gut is telling me lots of companies have loaded up their raw material inventory so they are just running this off hence why BDI has fallen.
    I’ve talked to a few companies who use raw materials and they say business is picking up (albeit its still along way off peaks). So something doesn’t look correct with the BDI.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 147 Ned S // Jul 17, 2010 at 4:54 am

    Your thoughts on the BDI align with a report I read recently. Rio seems to be “cautiously optimistic”. But that is a mid term sort of thing.

    I thought they might have managed a bit more volume.

  • 148 Anon // Jul 17, 2010 at 5:04 am

    Good to know Ned. You do alot more indepth research than me.
    DJIA looks like its puking. Lets wait for all the doomsday predictionists to comeout right on cue again ;). Looks like support is around 10,000 or just below. But lets hope it bounces from here.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 149 Anon // Jul 17, 2010 at 5:15 am

    Re: your comment on XAO performance, i think you’ve got something there Ned. The DJIA is in a much more bullish formation than the XAO. Seeing 6 bullish candles in a row (on DJIA) which usually means a continuation of the rally after an overdue pullback from overbought market conditions…yet this is not shown on the XAO. Might be an indication of a performance differential for both…and I think Greg mentioned this aswell awhile back.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 150 Ned S // Jul 17, 2010 at 5:22 am

    Yes, the bears will be able to tell everyone that the end of the world as we know it is coming again. Truth be told I think it just more a case that developing world standards of living are likely to go up while developed world ones go down a bit – Although from the developed world’s perspective that pretty much does seem to equate to “the end of the world as WE know it!” … :)

  • 151 Anon // Jul 17, 2010 at 5:28 am

    I think my intraday calls are horrible… I said Citigroup is about to breakout and its broken down before it makes its way higher. Albeit I did the same thing when EUR.USD was 1.27 then it went to 1.25 before going to 1.30.
    thankchrist I am not a day trader. I think I would go bankrupt.
    Seems my calls are better for longer durations of a few months or more.
    BP is another too early, albeit I was right a month later with a few more grey hairs ;)

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 152 Anon // Jul 17, 2010 at 5:35 am

    “Truth be told I think it just more a case that developing world standards of living are likely to go up while developed world ones go down a bit ”

    Jim Rogers agrees with you there.
    Although Buffet seems to think developed countries standard of living will be much more improved than what we have now.
    Abit hard to see how peoples standard of living can improve when they are all deleveraging!
    Although Ken Fisher (phillip fishers son) seems to think consumer debt can continue to grow as it has for decades. And that the consumer debt bubble arguments are overblown.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 153 Anon // Jul 17, 2010 at 5:49 am

    Something that I remember Jim Rogers mentioned awhile back is the inverse relationship between commodities and equities performance.

    “Go back and you will fins that the last 100, 200, 500 years we have had periodic bull markets in commodities followed by periodic long bear markets in commodities. Likewise, we have had long bear markets in stocks followed by long bull markets in stocks. When you have a bull market in commodities you have a bear market in stocks.

    *From Inside the House of Money

    So if Jimmy is right equities would prefer lower commodity prices. So its not necessarily a bad thing for us that commodity prices have come off somewhat. If Jimmy is right and the commodity bullmarket has some puff left in it, then stock market timing is going to be crucial or you’ll end up with flat returns over a decade.

    “I think my intraday calls are horrible”
    Btw should read looking at my longer duration calls on an intraday basis. Never made any intraday calls thankgod.

  • 154 Ned S // Jul 17, 2010 at 6:09 am

    “comment on XAO performance” – I’m not sure Anon – It could just be the Americans choosing to keep their money close to home/in their own currency – Ours is awfully volatile. And it may well have been like that since March 2009 all through the rally? I know it was early in the piece – That is one of the reasons I’ve never really felt to trust the rally. Dunno – But it’s worth keeping in mind regardless I think.

    “consumer debt bubble arguments are overblown” – That one would upset the hard money crowd – I’ll have to follow up on it … Ta! ;)

    Standards of living – I think we’re already seeing it in a lot of the developed nations – The UK and the US both seem to have some pretty major issues going forward. And the PIIGS are obviously going to struggle. Doesn’t surprise me a whole lot if they are like us though – I was fiddling with my tax last night and noticed that on my last assessment I got both an Entrepeneurs’ tax offset AND a Low Income tax offset – Never really thought of myself as a charity case before? – But apparently in Oz I qualify??? :) We just can’t give people the handouts we do and not expect to get hurt somewhere down the track is my thought.

  • 155 Anon // Jul 17, 2010 at 6:41 am

    http://finance.yahoo.com/tech-ticker/article/334648/Too-Much-Debt–Please.–We-Need-MORE-Debt-Says-Ken-Fisher?tickers=tlt,tbt,spy,dia,%5Egspc,udn,uup

    Here ya go Ned, Fishers opion re: debt.
    Btw I probably dont agree with this, but I guess its something we need to contemplate. He is a billionaire and has had contrarian views in the past (Like being bullish car markers in the 70s/80s when everyone thought the end of the world was upon us and we didn’t need cars because we were going into the stone age).

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 156 Anon // Jul 17, 2010 at 6:47 am

    The thing that bothers me regarding the debt issues…is these arguments were occuring in the 70s,80s,90s and 2000s. And each time people were preaching a world depression and the end of fiat money and consumer spending.
    I’m just wondering if i’m going with the crowd instead of against it.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 157 Anon // Jul 17, 2010 at 7:00 am

    In any event Rogers arguments regarding a bull market in commodities always leading to a bear market is stocks holds weight…a relationship that holds for such a long period has to be taken seriously. So we are in a intermediate bullmarket within a longterm bear market imo. Rogers mentioned commodity bull might end in 2015 or so, so markets will likely be rocky for awhile – making market timing crucial. Albeit Fisher could be right 10-20-30 years from now re: our levels of under indebtness and our ability to increase our capacity to borrow.

    So confusing!!

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 158 Anon // Jul 17, 2010 at 5:42 pm

    Seems like consensus is the XAO will keep going sideways so you should trade them. And we’re getting alot of newbies wanting to trade for the first time.

    Usually when this starts to happen buy and hold works better. Abit like when everyone wanted to short the AUD when they should of been going long.
    Seeing lots of trade school offers ways to “profit from the volatility” – not to mention adverts on television. Just more snake oil salesman that just waste our money!

    I’m almost back to buy and hold right now, bar my currency positions. And then do that until the sheep start holding for the longterm again (no doubt at the top of the market).

    1%-2% of the 5% winners out of 95% losers make most of the money trading. So I don’t like those odds unless I can fire a dart blind folded and hit anything (i.e. in May).

    Kinda feel “the dart time” for buy and holders is comming, given the crazy valuations across the board. Lets hope we all prosper together and have the ability to be patient.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 159 Greg Atkinson // Jul 19, 2010 at 8:13 am

    Well the BDI might have bottomed out for now at 1700 and it looks like it me be trying to rise again. But for a country like Australia that depends so much on commodities exports a weak BDI is not a good sign.

    Remember there are a lot of ships being scrapped and laid up, so I would say that the impact the G20 economic stimulus measures are starting to fade and as a result we will see commodities prices drop back a touch.

    But like I have said a few times, the All Ords/ASX 200 have already taken a major hit and are still way down from the highs of 2007, so I reckon that over the next few years they will gradually climb back up.

    But when will we see the Australian stock market reach a new high? 2012 perhaps?

  • 160 Anon // Jul 20, 2010 at 6:28 am

    Yeah, BDI looks to be moving up, altho could slip alittle more before going North – but clearly bottoming out.
    2012 New high? Well anything could happen!
    Historically it takes along time for people to recover emotionally and financially after major crashes like 2008-2009:
    XAO
    Year: 1987
    Approx crash from top to bottom: >50%
    Years before new highs reached (from previous highs): Arguably double top in ~93 so >9 years to make new highs.
    —–
    SPX
    Year: 73-75
    Approx crash from top to bottom: >48%
    Years before new highs reached (from previous highs): ~>7 years
    —–
    SPX
    Year: 73-75
    Approx crash from top to bottom: >48%
    Years before new highs reached (from previous highs): ~>7 years
    —–
    DJIA
    Year: 1907-8
    Approx crash from top to bottom: >48%
    Years before new highs reached (from previous highs): ~8 years
    —–
    DJIA
    Year: 1920-22
    Approx crash from top to bottom: >45%
    Years before new highs reached (from previous highs): ~5 years.

    *Just approximations as it takes too long to do each calculation to the exact number…just trying to be slightly right as opposed to completely wrong.

    The DJIA charts over 1997-2010 are looking eerily familiar to the charts from 1915-1925. If that correlation held out Greg could be right and new highs in 2012. Or it could take the usual 7-8 years which would make that 2014-2015.
    I’m still betting on a 2011 crash (20-25%) but it appears 2012 onwards maybe different…lets see what happens and change as markets change.

    The DJIA currently appears to be moving up on bad news (housing data)…so becoming cautiously optimisitc. Guess people on the sidelines dont like holding overvalued treasures with terrible yields.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 161 Anon // Jul 20, 2010 at 8:46 am

    Well been fairly inactive last couple of months (and for big chunks of this year). Good to keep transaction costs down and not help my broker attain more record profits ;)
    Not much to do on a buy and hold portfolio, accept be patient and wait.

    *All posts by this poster is not financial advce or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 162 Anon // Jul 23, 2010 at 8:39 am

    Libor 1,3,6 and 12 months are falling;

    BDI bottoming;

    Investors intelligence bearish;

    DR Copper is looking better;

    Risk currencies are rallying;

    Valuations are good, decent margin of safety over risk free rate;

    Yield Curve shows probability for double-dip unlikely, as short term rates are lower than long term rates;

    Richard Russell is bearish;

    Corporations have record levels of cash;
    “Corporate Sector is cashed up. For example, total liquid assets of the US non-farm, non-financial sector expressed as a percentage of net worth is at its highest level in 60 years at over 14%. This, in part, is because the recession reduced equity by about 22% but also because of the strong kick-back of profits and the historically low level of capex.” June Platinum quarterly.

    Hedgefunds are still below normalized long levels and overly cautious in general;

    US treasuries overvalued and overbought;

    US interest rates unlikely to rise this year given weakening second half (see consumer metrics readings/indicator)

    Ben Bernanke – “We are ready and we will act if the economy does not continue to improve — if we don’t see the kind of improvements in the labor market that we are hoping for and expecting,”;

    Pimco selling insurance for Black Swan events;

    Weak hands from retailers who bght and held thru the correction, begining to think about selling strength.

    So being bullish is clearly the right play atm imo. My technicals are flashing bearish signals, but technicals can be useless at times so wont bother using it here, given the copious amount of data inline with bullish future prospects (albeit volatile).

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 163 Senator13 // Jul 23, 2010 at 9:44 am

    Looks like a good day for the aussie market and markets around the world.

    Some good earnings results coming out of the US today too.

  • 164 Anon // Jul 26, 2010 at 10:53 am

    I’m abit concerned with how the USD is acting. Given Britain and Europe are now bringing in plans to cut deficits etc it just leaves the United states which is still a basket case. Given US unlikely to raise rates this year + no immediate measures to reign in deficit spending = problematic for the USD.
    USD could retest intermediate lows (double bottom) before marching higher, which is quite abit of downside risk.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 165 Anon // Jul 26, 2010 at 1:03 pm

    Looks like XAO may topout around 4,700-4,800 on this rally over the next few weeks, so not much to go. Am starting to re-insure the portfolio as the rise continues. Then Sept-Oct correction back to perhaps 4,350 and 10,000 DJIA? Kinda inline with the 2 year presidential cycle, altho adjusted for statistically unlikey price targets/action.
    Sector rotation aswell as stock selection within the sector is going to be key imo. Two tier market is occuring.

    Bullish: Healthcare, Consumer Staples, Energy, Utilities, Telecommunications, Soft Commodities.
    Neutral: Financials, Commodities, Capital Goods.
    Bearish: Insurance, Cyclicals, Transportation, Technology.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 166 Anon // Jul 26, 2010 at 1:49 pm

    Looked at some previous corrections in past history and i’m pretty sure (but u can never be 100%) that the next possible correction in Sept/Oct will be much shallower than the May one. Its statistically improbable to have two 15%+ corrections in such a short period of time. You generally get only one ~15% correction every 11-12 months. So I wont be dumping out of this rally, as any possible correction will be too shallow and temporary to time; thus will stay almost fully invested thru Oct with hedges. Likely to be a very viscous rise out of the Oct lows – unlike the May/July situation. I don’t want to miss the bulk of the trend given markets only trend ~15% of the time. Statistically its shown trying to time markets makes you under perform and miss bulks of trends – so i’ll buy and hold till Feb next year.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 167 Biker // Jul 26, 2010 at 5:10 pm

    “Likely to be a very viscous rise out of the Oct lows – unlike the May/July situation.”

    Yes, I’ve thought about oil shares myself… .

  • 168 Anon // Jul 26, 2010 at 5:49 pm

    Hey Biker. Yeah well the peak oil bubble has to re-start sometime. My technical readings are suggesting a possible double top in oil @ $140ish, but i’m really not sure how its going to get there; especially with a weakening 2nd half economy. That just leaves terrorist activities / war / or more likely, some supply side shock on a major well, related to long term depletion?
    Also, have to be careful with stock selection…some equities are going down the gurgler and some are holding and tracking oil more consistently. My main oil exposure is in the US – USO and WPL on the ASX, aswell as some indirect agricultural net/net plays and more riskier BP. And obviously this post isn’t financial advice.
    Investing in oil is abit like buying gold, if you dont run for the exits when people start heading for the doors, you’ll be left with a soggy cigar butt in your mouth and a near worthless contract/script ;)
    Might be some short term weakness in oil, as this hurricane premium comes off?

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 169 Anon // Jul 27, 2010 at 6:36 am

    Good bullish leading indicator from mutual funds; retailers still doubting the rise which is bullish signal aswell:

    “Mutual funds, pensions and endowments are spending more on stocks than at any time since the start of the bull market, just as individuals grow the most pessimistic in a year.”

    http://www.bloomberg.com/news/2010-07-25/stock-buying-hits-bull-market-high-at-institutions-as-individuals-retreat.html

    Mutual fund bullishness is usually only a contrarian indicator at market extremes, the crowd is usually right in the meat of the rally.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 170 Anon // Jul 27, 2010 at 7:50 am

    T2 Partners quarterly

    http://www.valueinvestingcongress.com/landing/n10/downloads/T2-Partners-AB-InBev-BP-Microsoft.pdf

    Talks about market direction, whether we are in a bear or bull market, or both. Dont agree with their range bound thesis, at least for the next several months into next year. High probability to break out of the range and new highs, albeit we might slip back into the range (after Feb 2011?) on a longer duration.
    Page 41 onwards shows why BP is undervalued and the media have completely overblown the potential damages. I partially fell for the media hype by selling my position at near breakeven, but quickly realised my mistake, bght calls, and then loaded common on the last pullback @ 35$. Wont be making the same mistake twice! If you are going to make a mistake, thats life; but you better recognize it quickly, even if you are unaware you better become aware, or life will force you to!

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 171 Greg Atkinson // Jul 27, 2010 at 7:55 am

    Anon…I think you could probably post some of these comments here? Global Economic Outlook

    Anyway regarding the Australian stock market, we might be in for a nice Q3 rally back up to 5000?

  • 172 Anon // Jul 27, 2010 at 8:27 am

    Sure, i’ll move them now. You might need to delete a couple of posts.

    I’ll move my currency chat over to that thread aswell given the pairs affect the global economy.

    Q3 rally is possible into August early Sept?…but my technical models saying flat at best during Sept/Oct with strong bias for an 8-10% correction during that period. Might be a 4Q rally past 5,000? Either way its highly probable for a big rally sometime in the second half, given historical returns comming out of ~50% crashes; since the early 1900s.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 173 Plornt // Jul 27, 2010 at 1:57 pm

    “The Investors Intelligence survey, a measure of investment newsletter editors from ChartCraft is basically unchanged once more. This week we have an absolutely equal amount both bearish and bullish (35.6%). For the previous 2 weeks, the bull bear ratio has been hovering around par and this week that continues once again. The last time the bull bear ratio was this low was in July 2009 and April 2009.

    AAII
    This week the American Association of Individual Investors’ weekly sentiment survey had a decline in optimism. The bulls decreased from 39% to 32% while those expecting higher prices increased from 38% to 45%.”

    Switching usernames from “Anon” because there are too many different people using Anon, so it gets confusing.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 174 Biker Pete // Jul 27, 2010 at 10:30 pm

    G’day Ned. Here’s the tax info DRA keeps blocking:

    Senior Australians Tax Thresholds
    The taxable income level above which Australians eligible for the Senior Australians tax offset (SATO) begin to pay tax will increase on 1st July 2009

    Eligible single senior Australians will have no tax liability if their rebate income is:-
    • < $29,867 for the 2009/10 income tax year
    Eligible senior Australian couples will have no tax liability if their rebate income is:-
    • < $25,680 in the 2009/11 income tax year
    The amount of SATO will be determined by reference to a taxpayer's ‘rebate income'.  The SATO entitlement reduces by 12.5 cents for every $1 of rebate income above the following relevant thresholds:-
    • Single – $2,230
    • Couple (each) – $1,602; and
    • Couple (separated by reason of illness) – $2,040

    You may already have this info.

    Still working on THE LIST. Once I have all the answers I'll post it all…

  • 175 Plornt // Jul 29, 2010 at 10:15 am

    Markets might go sideways to up here. Risk/reward not good from these levels given possible Sept/Oct weakness, so am not selling or buying (longer duration risk/reward still good) but have been increasing hedges substantially.

    GBP.AUD looks really good, have backed the truck up and am scaling into EUR.NZD, altho I don’t think the latter has made a bottom yet, so as usual could be too early.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 176 Plornt // Jul 29, 2010 at 10:31 am

    Anyone see the media reports re: BP oil dissipating and they cant find it! Microbial dissipation along the sea floor or something?
    Could be a chargeback for BP now that the oil is dissipating. 30 billion is starting to look overstated for liabilities, might be less than 10 billion total, over 10 years? What a rediculous over reaction this was! They probably don’t need to keep selling assets and have enough cash.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 177 Plornt // Jul 29, 2010 at 7:50 pm

    We have to be careful here gents. Theres alot of false bottoms occurring across various instruments.
    This market is looking dangerous in terms of relative price performance for stocks in the same sector, aswell as ST rallies sucking in intermediate duration trend investors.
    Very difficult market. Must always know your VAR, tail risk, risk collars. Capital preservation at all costs.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 178 Plornt // Jul 30, 2010 at 10:11 pm

    http://www.consumerindexes.com/commentary_2010_dailygrowthindexvsgdp.png

    The consumer metrics chart is getting worse! And to top it off the US GDP figure was below expectations that were already expecting softness.

    Going to be a rocky sideways ride through Sept/Oct I suspect.

    Shorting the AUD/USD again and unloaded EUR/USD longs.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 179 Plornt // Jul 31, 2010 at 6:03 pm

    Still long haven’t sold but hedged with cost neutral risk collar strategies and defensive currencies. Haven’t put on any futures hedges yet as we still may go alittle higher.
    Thinking about 4,700-4,800 on the XAO and 10,700-10,800 on the DJIA and then i’ll probably begin to hedge the whole portfolio out to protect against the possibility of another fall to 10,000 or so in Sept/Oct. If we break these levels then we could go higher.

    The bottoming process we just experienced gives a high probability for a lower high (temporarily) followed by a near retest of lows under 10,000ish. I’ve been trying to refine my exits as my entries are good but exits shocking. So far was good on Euro, lets hope it works on this index read.
    I’m entertaining the thought of lower lows on the next correction, but still can’t see that happening yet – it would be very rare statistically. But the economy is slowing much more than I anticipated in my modeling.
    Not going to be complacent here, takes you a small amount of time to lose it and years to replace it. Cut risk when markets rise meaningfully and increase risk when markets are at statistical lows.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 180 Plornt // Aug 2, 2010 at 9:43 am

    If the pound moves inverse to the XAO, this is abit of a concern for markets post August as seeing big breakout setups on the GBP.
    The correlation could break or weaken so keep that in mind.
    I saw similar setups in April about 4 weeks before the markets rolled over. But given recency bias, I doubt we will have the same sort of correction as was in May; that was brutal.

    So the GBP is starting to look like the next big move in the currency market more and more.
    Volatility on these pairs are high so drawdowns will be inevitable and scaling in will be key.
    Am going long both GBP/AUD and GBP/NZD with very loose stops to allow for the volatility…could move down 700 pips and still be on a breakout move, no point giving temporary drawdowns to the volatility gods.
    Targets for GBP/AUD are 1.90 and GBP/NZD 2.45 and is high probability.
    Looking for perhaps late August move on the pound.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 181 Plornt // Aug 2, 2010 at 2:42 pm

    Low volumes on the XAO, pretty bullish sign as you come out of market bottoms.
    Looks like there is alot of stuck shorts who are putting off covering as they think its a sure bet monthly mean reversion will occur at some point.
    Can’t see any reason to sell here, even though I am fighting off the urge to sell everyday. Stay the trend until price confirms.
    Probably a bullish sign I feel like selling as I usually sell too early?

    Cut some of my AUD/USD shorts as its moving against me.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 182 Plornt // Aug 3, 2010 at 10:07 am

    Wow what a rally overnight, looks like shorters were covering en mass.
    The DJIA is near my target range…there is alot more risk than reward from these levels. The faster you bounce like this, the more likely its a bull trap. I think more sideways action here to frustrate shorters, for a few weeks/months then a drop down. But important to note alot of value stocks will breakout at the top of a range, so timing from individual stocks can be quite different to timing the index. I’m still not selling as I see value in what I hold that is yet to be realised regardless of the index, derisking index and tail risk with risk collars.
    But clearly its very risky to be buying from these levels given Sept/Oct headwinds and slowing GDP. Markets have gone from discounting the GDP slowing to now not discounting it at all.
    USD Index has gone down for over 8 weeks straight, so a bounce would be expected soon. Its at critical support.
    I’m still not fully hedged but if we keep going like this I will be.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 183 Plornt // Aug 3, 2010 at 10:34 am

    ES futures prices for further dated contracts are now pricing in a fall in the index. This is similar to what I was seeing in the VIX when it was at record lows…i.e. VIX contracts for future dates were alot higher than the current price.
    Feeling very uncomfortable at these levels.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 184 Plornt // Aug 3, 2010 at 11:38 am

    Thought this was interesting in regards to investment performance relative to indexes:

    How you invest in flat or declining markets determines your ability to outperform over the longterm -

    “However, I have pointed out that any superior
    record which we might accomplish should not be
    expected to be evidenced by a relatively
    constant advantage in performance compared to the
    Average. Rather it is likely the if such an
    advantage is achieved, it will be through
    better-than-average performance in stable or
    declining markets and average, or perhaps even
    poorer-than-average performance in Rising Markets

    Warren Buffet. 1960.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 185 Plornt // Aug 4, 2010 at 2:06 pm

    Looks like XAO is settling at these levels, might go up or down – not sure. But can’t imagine a big move in either direction right atm.
    Markets were anticipating US stimulus and now Bernanke has said he will wait. So this USD capitulation and subsequent inverse move on equities is starting to look exhausted. People have GFC stimulus recency bias atm and that has caused unrealistic speculation towards equities; in anticipation of something that hasn’t happened and has been confirmed that will not happen soon.
    Big move on Pfizer (PFE) last night. Results were finally better than expectations after having just ok results from Citigroup and Sanofi Aventis. Just shows you stock picking is key not just sector selection. When enough people hate a technique it begins to work again and produce outsized returns, until its in vogue again and then the method loses its edge.
    My conservative valuation on Pfizer is 24$, currently at ~16$. Optimistic instrinsic value is 33$ – but doubt we’d get that high. I have been adding on the way up and pressing the position (if exercised my calls it would be 130% of my entire portfolio).
    Will hold till at least 24$ and not a cent less. Wont use charts on this run as if I followed them i’d be whipsawed or headfaked 20 times on the way to 24$ – waste of concentration.

    Looking at going long the USD.JPY but not 100% sure its bottomed.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 186 Plornt // Aug 4, 2010 at 3:07 pm

    “Jim Rogers predicts a new recession in 2012″
    http://www.telegraph.co.uk/finance/economics/7913302/Jim-Rogers-predicts-a-new-recession-in-2012.html

    Albeit Jim tends to be bearish at markets bottoms in the past, his longerterm macro calls have been relatively accurate.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 187 Plornt // Aug 5, 2010 at 2:28 pm

    Not much happening today. XAO up abit following Wallstreets lead.
    Looking to sizeably increase BP position as the more I look at it the more i’m convinced the government has over done it re: the compensation fund and given the oil is now dissipating (which is no surprise given the size of body of water affected) liabilities may not even be 5 billion from here.
    People are going to have a tough time claiming outside of direct obvious damage given how quick things have been almost plugged and now oil dissipating. For example people claiming losses on their house prices is going to be very hard to prove, given the real estate market.
    Looks like everyone concerned have over-reacted due to the speed of the media cycle these days and the government have done the same.
    I think there probably shouldn’t even be very much of a discount given how much BP earns and the fact money has already been put aside, which I think is about double what they need in 10 years time! Looking at 60$ targets.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 188 Biker // Aug 5, 2010 at 8:27 pm

    Yeah, yeah. Considering Mr Rogers Neighborhood* I’d take it with a grain of the proverbial, Anon.

    The problem is that we only hear about it later when these guys are actually _right_ in their predictions. They make _sure_ we know they said it!

    So we owe Rory Robertson a debt of thanks, for concreting Steve Keen’s ludicrous predictions firmly into the foundations of Australian financial history. :)

    * http://www.google.com.au/search?client=safari&rls=en&q=Mr+Rogers+Neighborhood&ie=UTF-8&oe=UTF-8&redir_esc=&ei=2J5aTI6JL4HEvQOZmuGBAg

  • 189 Plornt // Aug 6, 2010 at 10:41 am

    Well Rogers has a good track record Biker. He said China was going to boom 20 years before you even knew about their growth. And Japan was going to implode in the mid 80s just before the 20 year bear market.
    He was calling for a commodities supercycle in the early to mid 90s.
    He does like Australia longterm, but says our politicians are almost as bad as Americas and we need to bring in our spending and deficits, or our future will be much less certain.
    I think someone who has such a great macro and investment record for over 40 years is someone I should listen to now and then ;) I think he compounded at about 30% p.a. during the 70s while the market went sideways.
    Although, I won’t listen to him all the time – especially when investment periods are less than 12 months – where logic and thorough analysis has less effect on prices.

    Atm the trend on the XAO is up. We are all trying to pick a top which i’ve found is a futile exercise, although I do nail quite a few turns with the shorts. So I will wait for price action to confirm the trend has exhausted, which objectively atm looks a fair way off.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 190 Plornt // Aug 6, 2010 at 9:35 pm

    Terrible jobs number, still got all my hedges on. Am thinking of increasing some of my USD long. Figure was supposed to be 60k+ and 50k lost would have helped the markets.

    ‘Breaking News: Economy sheds 131,000 jobs in July; stock futures turn negative”

    http://www.reuters.com/article/idUSTRE65M2WK20100806

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 191 Plornt // Aug 10, 2010 at 1:07 pm

    XAO Rally is starting to look exhausted. But you never know when these rallies end, and they can go on for much longer than you anticipate.
    I am now hedged in a way that my portfolio should rise in both directions (aslong as there is not extreme index upside). Its rising today even though the XAO is falling and rose yesterday when the DJIA rose.

    Pretty large position on USD/JPY atm which looks poised to make a ST move to 88-89, albeit may retest the recent lows.
    Still cutting back my short AUD/USD position (been cutting it back for the last week) as I think this is starting to become a crowded trade. May change my mind as prices change of course. Still have a decent size on though, incase I am wrong.
    Never let a loss get too big, because you are too stubborn to admit an error and begin to rationalize it.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.
    Be sure to seek and take personal professional advice from someone familiar with your circumstances and needs.

  • 192 Plornt // Aug 10, 2010 at 4:07 pm

    Summer Rally Historical Performance May/Jun low to Q3 high on DJIA is on average 9%. Looks like any upside from here is high risk for the next few
    months anyways (if averages hold out)

    Although Statistically August tends to be stronger in the middle than at the begining or end. So perhaps one last “blow off” type bull trap rally before we
    rollover for about 8-10%.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.
    Be sure to seek and take personal professional advice from someone familiar with your circumstances and needs.

  • 193 Plornt // Aug 12, 2010 at 9:53 am

    Been relaxing but did make a couple of changes.
    Unwound my hedges as I think we are close to a bottom here. Been buying CL aswell as GC.
    Major support around 10,200 DJIA and 4,370 for the XAO.
    I am contemplating shorting heavily on the next rally say around 4,800 and 10,800 in Sept/Oct. I wont be unwinding shorts on that line early. Infact i’m pretty sure (although never certain) it will be either flat at best or 8-10% down. Alot of retail investors will look at the past price action and assume another shallow pullback and then get hit from recency bias.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.
    Be sure to seek and take personal professional advice from someone familiar with your circumstances and needs.

  • 194 Plornt // Aug 13, 2010 at 2:05 pm

    Not sure what the XAO is doing atm.
    Bght a decent long ES line at the SPX lows ~1072ish. I think thats the bottom, if not its very close to it…so risk/reward looks good. Will look to hold them for the next few weeks into early/mid Septh.
    Loaded up on GC yesterday, which I mentioned in the previous post. Its exploded now. May be slight pullback who knows but there is a big breakout comming, so will probably use puts to manage my risk instead of hard stops – want to participate to get the meat of the rally.
    My CL – oil contracts are underwater, bght 78$ now 76.5 Looks like oil has bottomed from my interpretation of the charts…so looking for 86$ on the next run.

    Never think you are better or know more than the market or people on the otherside of the trade — you will be slaughtered and carved up!

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.
    Be sure to seek and take personal professional advice from someone familiar with your circumstances and needs.

  • 195 Plornt // Aug 16, 2010 at 1:06 pm

    XAO looks to be bottoming out.
    Cutting risk from companies I hold that haven’t released results yet (extra puts, cut position size). It seems to be almost gambling betting on a company prior to releasing results – you don’t know what can happen. Although of the companies I hold only one (so far) has failed to beat or meet expectations out of 15 – with still some yet to report.
    Am heavily overweight ES longs waiting for the inevitable short squeeze.
    Last 5 years late August has been typically strong for the DJIA/SPX.
    Am now long EUR.USD for a ST play.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.
    Be sure to seek and take personal professional advice from someone familiar with your circumstances and needs.

  • 196 Vince L // Oct 14, 2010 at 5:45 pm

    Plort you were about right, the market bottomed out in mid-late August. We now seems to be on a run up to 5000?

  • 197 Greg Atkinson // Oct 15, 2010 at 8:53 am

    The 5000 mark appears to be a lot tougher to break through than I thought. I guess the mining tax, carbon tax and election outcome have probably knocked 200 points off the market though so in a perfect world, we would be probably sitting near the 5000 level now.

    I suspect that if the All Ords/ASX 200 hit 5000 a lot of people will push the sell button just to lock in some profits so I wonder if there is much chance of ending the year much above 5000.

  • 198 Ned S // Oct 16, 2010 at 12:03 am

    A naughty thought that just flicked through my mind is that a genuine improvement in the US economy just could cause lots of ‘things as we currently know and love them’ to unwind pretty sharply in the absence of ongoing hopes of stimulus and QE.

  • 199 Greg Atkinson // Jan 6, 2011 at 7:33 am

    Well I have stuck my neck out again and taken a punt at predicting where the market will end in 2011: Australian stock market outlook for 2011

    It’s already looking like this year will be full of market surprises!

  • 200 Greg Atkinson // Jan 15, 2011 at 11:58 am

    Here is an extract from the latest stock market outlook from Wilson Asset Management (ASX:WAM)

    “Heading into the new calendar year we remain cautious despite the rally in equities since July 2010. We remain concerned about a bubble forming in the mining sector, especially among smaller resource stocks, with many leaping by more than 100 per
    cent in just six months. The emergence of inflation in China could result in authorities being forced to slow growth and, as a result, reduce demand for Australian commodities.”

    Interesting…

  • 201 Anon // May 17, 2011 at 7:47 pm

    The XAO looks so sick. These charts look absolutely lurid.
    Pulling away from buying anymore silver, will wait for the equities crash to load up on silver only — avoiding equities like the plague for the next few years.
    I think i’m buying into a disaster waiting to happen, with silver short term (intermediate/longterm still seems good). Am 98% cash atm and felt compelled to diversify my cash holding minimally.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 202 Greg Atkinson // May 17, 2011 at 7:58 pm

    Anon I steer clear of shorting simply because I have the market timing skills of three legged sloth. If I were a brave fellow I would be tempted to short some of the major mining stocks and possibly the big four banks. Of course now that I have said that they will all probably rally for years!

    The XAO and XJO have been tracking sideways for a year or more which amazingly I did anticipate quite some time ago. Hence I have not been much of an active investor lately.

    At this stage I will stick with my Australian stock market outlook for 2011
    and reckon we will end the year with the All Ords closing somewhere between 4800-5200.

  • 203 Anon // May 17, 2011 at 8:13 pm

    “Anon I steer clear of shorting simply because I have the market timing skills of three legged sloth.”

    lol, my timing isn’t too flash either.

    “If I were a brave fellow I would be tempted to short some of the major mining stocks and possibly the big four banks. Of course now that I have said that they will all probably rally for years!”

    Yep, they would be the problem areas in a downturn.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 204 Anon // May 17, 2011 at 9:49 pm

    Think i’m just going to stare at my small stack of silver and do nothing. Easiest and least stressful way to play it.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 205 Anon // May 18, 2011 at 9:43 pm

    Silver looks like its bouncing, might get lucky with this? Should of lost on this, was a stupid entry. Didn’t watch price close enough and bght on what I thought, instead of what I saw.

    Momentum is sick, MACD sick, volume sick, Candle formation(6 red candles), poss 20/48 cross imminent. Only positive is its above the upslopping 210. Probably a decent bounce then will fall again.

    I must be rusty. Can’t believe i bght silver straight after the ~30% crash. Horrible! Ah well, doesn’t matter, LT investment, av is 34$.

    LT Inv Trend indicators say sell.

    No use for my eyes, I must be blind.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 206 Ned S // May 18, 2011 at 11:48 pm

    A bit of interesting history on silver here Anon? :

    “His math adds up as follows: after a 435% rise over 628 trading days – a feat that has occurred 56 times since 1920- silver stands to lose a potential 85.84% in value (which is what happened in all 56 instances since 1920) and might fall to $6.86 per ounce.”

    http://www.kitco.com/ind/nadler/may172011.html

    I know absolutely nothing about it personally – Am just quoting a source that I read recently. Which by and large I’d at least expect to be historically accurate?

  • 207 Anon // May 19, 2011 at 6:43 am

    Thanks Ned, i’ll take a look.

    Yeah I was thinking about what if it fell more than 50-60%, worse than the GFC. Thats a sobering stat Ned. Confirms my concerns!
    My feel is that 18-20$ might be more likely. It needs to retest its breakout point. Whatever happens you have to hedge silver if you buy anything at much lower levels, just too uncertain over the next couple of years.
    But I have some patterns that I use that verify this rise is much bigger and very longterm. Its not the same as the 70s bubble in terms of end stage. Theres things to look for when silver has topped, and i’m not seeing that. I’m definitely seeing it for equities though and for US gov bonds.

    This is the problem trying to invest prior to equity crashes. It can become a value trap. Thats why its important to probe your investments, not go in too hard. My position is not big, thankgod. Send in the spies and not the army, and not many comeback lol.

    Silver will rise with war and usually outperforms equity crashes on the way up, so thats another thing to contemplate.

    “He called the inflation-adjusted price of gold “a valuation technique that remains one of the more brilliant carnival-barker efforts in the annals of Wall Street.”

    Well thats a different perspective. Jim Rogers seems to live and die by the inflation adj price levels. I listen to his calls, and have benefited from it, so I respect the guy, he does his homework.

    On the chart, Longterm support would be around 18-20$, and if it held that area, would begood for a longterm upswing. Could also bounce then drop and retest 27-30$ and hold that until the next parabolic rise 2-3 years from now (and the next parabolic rise 3-4 years after that, if the one preceding it isn’t too drastic and overvalues silver, so as to kill the longterm returns available).

    I don’t like that 6 red candle reversal on SLV, its a very reliable pattern. At best it means a range and slightly lower, at worst a complete collapse.

    But its bounced now ~35, perhaps ~33$ was the bottom and we are all being bearish, because thats what happens at bottoms lol.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 208 Anon // May 19, 2011 at 7:10 am

    The question now, is there a blowoff rally in equities before a crash, or a slow decline or a complete capitulation?

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 209 Anon // May 19, 2011 at 1:15 pm

    Going long very very cautiously and with very small size.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 210 Anon // May 19, 2011 at 1:59 pm

    Lots of people unsure, I am aswell!

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 211 Anon // May 21, 2011 at 1:09 pm

    Looks like XAO will significantly outperform the DJIA this year from current levels. Although looking at the quality stocks within the DOW 30, they will probably rise decently in the next few years, whilst the crap implodes.

    Walmart for instance has been doing nothing for a decade price wise, whilst its EPS has risen considerably and continued to buyback its stock. Long term, it can’t keep going like that (the High Pe in early 2000 nolonger exists). Likely most are questioning the recovery (understandably) and theres probably alot of baby boomers going from saving and investing, to now living off their funds. It would make sense to go into more cash as you become dependant on your funds to live, creating selling pressure. Or it could just be many other reasons, who knows.

    The outperformance of XAO, from here, makes sense given the disparity between the two.
    Perhaps a few dead cat rate drops, or the speculation of RBA rate drops will lead people back into the markets longterm for the final blowoff rally into next year? Given the retail investor support for silver post crash, it could be reasonable to assume there are alot of people on the sidelines who missed out on the recent rally, creating a floor on the XAO this year.

    I’m toying with 5500-5700 EOY or 4600 EOY right now. Either way it seems downside is limited from current levels. Statistically 4600 is less likely. Also August-Oct is very dangerous. So what to do. Probably wait or pick things that you would hold through a bad crash and the possibility of XAO 3,000 in a few years. Large Cap Utilities and Consumer Staples probably main things that would hold up, silver and gold too, although gold is very overdue a correction at some point, given silver tends to be a leading indicator for gold.

    At the sametime, statistically theres a very high probability that DJIA is 11,000 or below by EOY. This is a very confusing setup, which is only making me more cautious and confused longterm.

    Most of the charts in the XAO look terrible, lots in downtrends. So even if I wanted to invest longterm theres not many buy signals. Probably wise to avoid small caps, given the risks.

    The LT buy signals may only come post August-Oct correction, or we could correct heavily in June, who knows. One would assume the quality growing large caps will more likely go up in late stage bull markets and into the foreseeable future. Probably the best course is to wait for the DJIA to implode during Aug-Sept and then take longterm positions in the XAO, or slowly accumulate with the knowledge that it could fall further, short term.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones. LT investments ideas may change as things change, donot rely on them.

  • 212 Anon // May 21, 2011 at 2:39 pm

    Am about 90% cash right now, with 10% in LT investments I would hold through a downturn. Would like to buy more, but everything just looks so ugly technically. Am avoiding the States, and sticking with the XAO

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones. LT investments ideas may change as things change, donot rely on them.

  • 213 Anon // May 21, 2011 at 6:49 pm

    Good signs:

    “After a short-lived rally post-crash – when the S&P/ASX 200 Index climbed above the 5000-point mark – the index has been languishing at about 4800 points. Worse still, it’s hard to see the sharemarket regain its strength over the medium term. But why should that be seen as a problem for most people?

    Anyone with a superannuation fund should be concerned because more than any other super asset, Australian shares have the biggest influence on our living standards in retirement.”

    “This is far from the double-digit returns people came to expect until three years ago. However, it’s unlikely super fund members will see those double-digit returns again in a hurry.”

    Read more: http://www.smh.com.au/money/super-and-funds/waiting-for-a-bull-market-20110517-1eq6o.html#ixzz1N2RVOSqn

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones. LT investments ideas may change as things change, donot rely on them.

  • 214 Ned S // May 21, 2011 at 8:22 pm

    My broad brush take on things is that Oz has got a demographic problem that will weigh on it for about 40 years Anon. (Though potentially offset by immigration to a degree.)

    But the positive is that we’ve got minerals. Which Asia wants. Providing we don’t get greedy and continue to produce them cost effectively.

    So, to the extent that Asia can continue to develop (by a combination of changing its economy to rely on its own consumption, and through seeing Westerm living standars drop to make the west more competitive globally), Oz will continue to do (comparatively) well – Though expect lots of volatility.

    And don’t rule out a very major crash/deflationist funk if the US does a dummy spit and goes protectionist while they are still a very major part of global GDP. Or should they effectively default – Because, truth be told, their basic economic position really is no better than that of Greece I gather?

  • 215 Anon // May 21, 2011 at 10:16 pm

    Not sure Ned, you know alot more about these issues, whilst being smarter. I’ve kinda given up trying to understand all these things. Its impossible to. Just trying to keep it simple and low maintenance, whilst trying to stick with what I know :P

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones. LT investments ideas may change as things change, donot rely on them.

  • 216 Greg Atkinson // May 24, 2011 at 6:57 am

    As readers of this site will know I always keep an eye on the Baltic Dry Index although many “experts” have been saying it is no longer worth watching. Well my view is that investors should check what the BDI is doing often and that it has been yelling out “severe market correction” for months.

    The current global market correction looks like it has further to run and will come close to pushing the ASX All Ords/ASX 200 near to 4400. The ASX 200 is taking more damage because it includes a lot of mining and banks stocks.

    But where is the bottom? As always I don’t know because I can’t predict the future, but at some point the bargain hunters will come back in and I suspect that will happen if the All Ords/ASX fell below 4400.

  • 217 Anon // May 24, 2011 at 11:28 am

    Anyone see anything to buy?
    Alot giving 6 red candle reversal signals. MACD is in downtrend.
    I don’t see anything i have a great deal of confidence in.
    Still 90% cash and waiting for longterm opportunities.
    I’m starting to see abit of panic set in from the price action, so thats a good sign.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 218 Anon // May 24, 2011 at 11:41 am

    Total disaster levels would be 3,700. Hopefully it goes down there, would be a very good entry for longterm holdings. Still looks like 4,400-4,500 for now.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 219 Plornt // Jun 9, 2011 at 7:30 pm

    If we don’t capitulate here and break 4459 (XAO), 4477 (XJO)
    would be a chance for a counter trend XAO rebound to 4,800. Be good to short around those levels, or if we breach 4744/4477, cleanly and closing prices. Then the major leg down to 4,100-4,200.

    I’m going to sit on my hands and do nothing. Not buying here for the possibility of a 200 point rebound, with risk of 400-500. More risk than reward, no thanks.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 220 Plornt // Jun 9, 2011 at 7:31 pm

    “4459 (XAO)”

    4559 correction.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 221 Ned S // Jun 9, 2011 at 8:27 pm

    FTSE is holding and hovering at 5,800. DJIA futures aren’t getting excited either way right at the moment. A break one way or other would seem to be called for???

  • 222 Plornt // Jun 9, 2011 at 9:13 pm

    Yep, however given its oversold we are due for some sort of bounce. Although I don’t like using oversold or sentiment in these sorts of corrections as they can go ever more oversold or bearish, leaving you in a drawdown. Better to be late and make sure the bottom is really a bottom, than be too early and get crushed. Holding for the longterm is very hard if you are -20% after you bght. I can’t fathom holding very many longs in this market, some people must be feeling some serious pain, which will impart selling pressure into any strength we see.

    But yeah, its definitely a big multistage reversal. Buy the dip mentally will get you crushed. People seem to have 2010 in their minds as to buying weakness.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 223 Greg Atkinson // Jun 10, 2011 at 7:26 am

    Well the Dow Jones rose overnight so it looks like the All Ords will bounce off the bottom of its trading range today. Personally when I see the market dip much below 4800 I reckon it is moving into the oversold range as my guesstimate is that the bear market bottom is around 4800.

    But I doubt stocks will rally much past 5000 for quite some time as I wrote back in May in: Why is the Australian stock market unable to rally? So it looks like we might have a few more months of what we have had over the last year or so…a market that is basically moving sideways.

  • 224 Plornt // Jun 10, 2011 at 5:02 pm

    Areas in equities am occasionally watching atm are financials, uranium, gold.

    Uranium stocks, where is the bottom of that? I’ll wait and be late on that one.

    Financials look interesting, but no bottom yet.

    Gold stocks look good aswell, should see a rally in quality gold equities, even if the markets go into a sideways topping pattern @ 4,800. Not sure about Gold itself; you could argue that its due one last blowoff rally, who knows.

    Have to be selective here, given the downside risk.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 225 Biker Pete // Jun 11, 2011 at 12:20 am

    Uranium? No need to watch it, Plornt.

    Just sit back, close your eyes and you’ll be able to discern a faint *glow* from the north, as Japanese consumable products hum ‘Sayonara’ to the rest of the planet… .

    Disclaimer: We used to believe uranium was cheap fuel. When the chips are down, it’s actually destroying other industries at an ever-increasing rate. Read the _daily_ flood of new reports from Japan before proceeding with any financial decision, or even going shopping for staple food items. Glad we got outa DYL years and years ago.

  • 226 Plornt // Jun 11, 2011 at 12:33 am

    haha look at this from bloomberg:

    “Saudis Eye Demand Before Raising Oil Output
    Saudi Arabia will increase oil production, though it is too early to say by how much, according to a Saudi industry official with knowledge of the matter.”

    Hilarious. I bet they cant raise by very much.
    Nat gas LT breakout – i’m in like gin

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 227 Plornt // Jun 11, 2011 at 12:48 am

    “Just sit back, close your eyes and you’ll be able to discern a faint *glow* from the north, as Japanese consumable products hum ‘Sayonara’ to the rest of the planet… .”

    Lol biker. You know more about it than me. I’ve only just started looking into it, having never invested into it before. So can’t really bring much to the table.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 228 Plornt // Jun 11, 2011 at 1:11 pm

    Seeing retail investors preparing to dump and go to cash across the board, next 3 trading days will be a 3-4 mth bottom imo. So another 200 points on the dow and 4534 on the XAO. If the XAO breaks the lows of 4477 that all goes out the window. Any investments need very heavy hedging and expecting further downside.

    Currently i’m 50% invested, with 20% in natural gas, 20% in large cap gold stock and 10% in silver, bluechips and large cap commodity stocks. Max risk is 5% accounting for hedging, so still very defensive. And will obviously exit quickly if things go against me. But potentially getting 11$ for every 1$ risked, so i’ll take that every day.

    Wouldn’t touch small caps, looks too risky to me. Large caps have gotten hit which means investors will look to possibly exit small caps and move to the “safety” of large caps for dividends and mean reversion, putting more selling pressure into any rebounds in small caps.

    Will not add anymore longs, probably look for longterm shorts for hedging longs.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 229 Plornt // Jun 15, 2011 at 4:37 pm

    For those of you who think small caps turbo charge your returns, look at the current small cap index and blood everywhere. To me small caps are gambling, akin to playing lotto.
    Small caps have atypically outperformed large caps for a decade, but eventually mean reversion occurs.

    This comment should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 230 Plornt // Jun 15, 2011 at 8:24 pm

    Looks like there may still be weakness in markets, lowered my investments down to 30%. Will turn on dime if I see a hint of a collapse.

    This comment should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 231 Greg Atkinson // Jun 16, 2011 at 8:52 am

    Looks like it will be an ugly day for the stock market after the Dow Jones slumped overnight. At this rate it will be a struggle to get back over 5000 by the end of the year and you get the feeling the downside risks are growing daily.

  • 232 Plornt // Jun 16, 2011 at 10:10 am

    Greg there is a double top on the XAO which usually means a 50% reversal of the highs to the lows from march 09. So that is 4,080-4,200. But it might take 12 months to get down there, or we could just capitulate now.

    All eyes on the VIX, watch for that to top Friday next week, as used to hedge investments.

    All posts by me are not be taken as financial advice or investment advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 233 Plornt // Jun 16, 2011 at 10:20 am

    Disclosure Currently hedging investment portfolio with VIX.

    All posts by me are not be taken as financial advice or investment advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 234 Plornt // Jun 16, 2011 at 10:32 am

    Well i’ve avoided a drawdown so far, and am slightly up, but don’t expect that to continue. Infact fully expect a drawdown at some stage, its inevitable.

    All posts by me are not be taken as financial advice or investment advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 235 Plornt // Jun 16, 2011 at 11:34 am

    Hopefully everyone is ok out there.

    All posts by me are not be taken as financial advice or investment advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 236 Plornt // Jun 16, 2011 at 3:49 pm

    Where are we on this psychology chart?

    http://2.bp.blogspot.com/_9MYixPWxtF0/S9kFJKpuEYI/AAAAAAAABkQ/NZKlmRlkbz4/s1600/investor-psychology-illustrated.gif

    I think theres a possibility that we are at 7

    All posts by me are not be taken as financial advice or investment advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 237 Biker // Jun 16, 2011 at 7:11 pm

    Plornt: “Hopefully everyone is ok out there.”

    Yes, thank you, Plornt.

    I’m not sure about dead cats, but I’m pretty sure I saw a drop bear bouncing over here:

    http://www.dailyreckoning.com.au/bankers-warn-against-house-price-speculation-no-really-they-do/2011/06/06/

  • 238 Ned S // Jun 16, 2011 at 8:26 pm

    “Hopefully everyone is ok out there.”

    All good here Ta Plornt. Hope the same applies to you. 50% Brissie housing and 50% cash is still working for me. (While Brisbane housing has dropped 6.8% over the last year, the cash will presumably let me buy more of it if/when I should like the price on it.)

  • 239 Plornt // Jun 16, 2011 at 10:26 pm

    “All good here Ta Plornt. Hope the same applies to you. 50% Brissie housing and 50% cash is still working for me. (While Brisbane housing has dropped 6.8% over the last year, the cash will presumably let me buy more of it if/when I should like the price on it.)”

    50/50 is the safe way. Can’t go too wrong, can you. I’m 70% cash atm and waiting for the right time to invest.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 240 Plornt // Jun 16, 2011 at 11:00 pm

    Lots of good economic data out (everything beat estimates) and the DJIA is barely moving. Not a good sign for next week.
    That Empire Manufacturing number yesterday was horrendous.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 241 Plornt // Jun 16, 2011 at 11:40 pm

    Not in natgas anymore, sold that a few days ago when Goldman issued a sell notice for a tiny gain. Trimmed alot of stocks back 2 days ago (see post 230), so 30% invested (sold 20%) and heavily hedged.

    You are only as good as you weakest defence. Probably less is more is appropriate right now.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 242 Plornt // Jun 17, 2011 at 4:14 pm

    Here comes the big capitulation drop over the next week. XAO has broken support.
    Given the rally was very big, wouldn’t be suprised if we have a bear market crash. DJIA is bearish.

    Be careful, tail risk first, then value. Value traps everywhere.

    If we follow the Mid 70s type reversal after such a huge rally, we
    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 243 Plornt // Jun 17, 2011 at 5:55 pm

    Looks like Paulson is one of the first high profile victims of tail risk, i expect more to come. Theres never just one cockroach in the kitchen.

    Paulson is a great investor though, so he’ll comeback sometime in the forseeable future.

    “Investors have told the Wall Street Journal that Paulson’s $9bn Advantage Plus fund lost more than 13% in the early part of this month. This comes on top of a fall in May, when the fund reportedly lost another 6%, leaving it down 19.65% for the year.

    Paulson’s funds are among the biggest investors in Sino-Forest, a Chinese and Canadian timber firm that has seen its shares fall more than 80% since a report surfaced in June accusing it of exaggerating the size of its assets. This month short-seller Carson Block’s Muddy Waters firm called Sino-Forest a “pump and dump” scheme and accused it of committing fraud. Block’s firm challenged the amount of land Sino-Forest said it bought in Lincang City in China’s Yunnan province, saying that it does not match city records. Muddy Waters’ claims are being fiercely disputed by the company.”

    All posts by me should not be taken as financial or investment advice. Seek a licensed financial advisor. Runaway from the incompetent ones. LT investments ideas may change as things change, donot rely on them.

  • 244 Plornt // Jun 18, 2011 at 10:22 am

    VIX looks like its topped, temporarily at least. So on that basis there may be some rallies here. But gotta keep an eye on it as it could be coiling for a bigger move.

    Saw alot of dumping in the options market re: puts, so that would be in line with some sort of rise. I’m still unsure as to the extent. Keep nimble.

    All posts by me should not be taken as financial or investment advice. Seek a licensed financial advisor. Runaway from the incompetent ones. LT investments ideas may change as things change, donot rely on them.

  • 245 Plornt // Jun 20, 2011 at 5:04 pm

    Snp 500 6 weeks down. Occured 16 times since 1928.
    3 months after each 6 week down period the markets have a 62% chance of being higher than current levels.
    1 month after the 6 week down period, markets have a 56% chance of being higher the following month.

    So in essence there is no clear direction, and this can be quantified.

    All posts by me should not be taken as financial or investment advice. Seek a licensed financial advisor. Runaway from the incompetent ones. LT investments ideas may change as things change, donot rely on them.

  • 246 Lachlan // Jun 21, 2011 at 4:02 pm

    Which share classes are you invested in Plornt?

  • 247 Ned S // Jun 21, 2011 at 6:06 pm

    G’day LACHLAN!!! :D

  • 248 Lachlan // Jun 21, 2011 at 7:29 pm

    Ha ha, good ol Ned. New you had to be around somewhere mate. I just looked to see what people are thinking of shares lately. My favourite class has copped a nice sell-off and I’m in shopping mode. Looks like things are on the up tonight but overall the Aus scene is pretty compressed. I enjoy these deflation fear turn-outs though because it creates great discounts and good value. I’m holding everything but share wise only a small investment.
    I recently had a conversation with a young bloke about property. He’s done well buying cheap out west in slow areas where lifetime renters can be found. Highly leveraged but positively geared due to discount purchasing. Not in mining areas of course….areas of low liquidity ie everywhere else. But then I thought later about whether it may be a case of buying wrong side of the tracks. That’s possible… but necessarily so.
    I’m still saving/investing and wondering where I fit in to this world so I can go about buying something. I have no idea how to answer that question. Having fun in limbo though it seems.
    Cheers Ned

  • 249 Ned S // Jun 21, 2011 at 7:49 pm

    I’ll keep the thread ‘clean’ and not chat about property Lachlan! :) But imagine you and Plornt and Greg and others might have some informative chats about stocks which I’ll watch with considerable interest.

    “Having fun” – Lucky bloody you! :D (I’M up to my ears in pre 30 June tax crap!)

    Great to chat as always …

    Cheers!

  • 250 Plornt // Jun 21, 2011 at 8:07 pm

    Obviously the following is not financial or investment advice.
    Lach, im in Gold bluechip equities, airplane interior manufacturers (definitely not airline stocks).

    Everything looks terrible in equities, so be very very careful, value traps everywhere. Gotta have otm puts on for each stock.

    Am scaling into Silver, oil directly, could be 5-10% more downside. Silver, oil equities don’t look too good.

    My non cash investment position is about 40% and 60% cash.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 251 Lachlan // Jun 21, 2011 at 8:10 pm

    Happy book-keeping to you Ned. Over’n out.

  • 252 Lachlan // Jun 21, 2011 at 8:39 pm

    I’ve been waiting for the current consolidation in silver to break lower (for physical purchase I have a small truck load of cash ready) Plornt but otherwise have already bought some near the recent lows. I’m bullish though just guessing there’ll be a flush out before shorts cover and go berserk on the long side. Some metal shares I see are hitting solid support areas and some could go lower but all up I’m seeing plenty to go for.
    No options for me , just small positions for risk control. I can hold them forever and I will if need be. Otherwise I’m a long term bull and I doubt we’ll see a crash below March 09 lows however 4200 is possible imo. Other areas of interest are oil,coal and gas in the past though currently holding none. On PM shares I’m mostly small cap however the NCM dip is tempting where 36 looked a great pivot.

  • 253 Plornt // Jun 22, 2011 at 8:55 am

    “Otherwise I’m a long term bull and I doubt we’ll see a crash below March 09 lows however 4200 is possible imo.”

    Agreed
    I’m in a couple of metals small cap stocks for a flutter, but nothing significant. Am in FMG.

    “Some metal shares I see are hitting solid support areas and some could go lower but all up I’m seeing plenty to go for.”

    Yes i’m seeing the support areas hit on various metal shares, but my system has only given buy signals on a few. So can’t go in.
    I don’t use support levels on my entry system.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 254 Plornt // Jun 22, 2011 at 2:22 pm

    “Otherwise I’m a long term bull and I doubt we’ll see a crash below March 09 lows however 4200 is possible imo.”

    Well I hope we dont retest the lows. If we followed the 87 recovery, we would — which means a 2 year downtrend, with no decent uptrends in the equities market.

    Doesn’t look like any kind of capitulation is occuring yet and theres alot of complacency around, which worries me greatly.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 255 Plornt // Jun 22, 2011 at 3:03 pm

    If you want to see what a market bottom looks like, look at the uranium market. I want to see that kind of sentiment in the equities market generally.
    Constant new lows taking people out over and over and over till they give up. Thats not happening right now.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 256 Lachlan // Jun 22, 2011 at 4:38 pm

    Hi Plornt
    The trend for PM shares is to go nowhere while PMs priced in dollars escalate so I accumulate small positions and don’t sell.
    No stops here. Mr Market eats those for lunch.

    I concur with your thoughts on commods and AUDs. I’m not saying China wont hiccup sometime. Volatility guaranteed, that’s how I think the system works to push the dollars further.
    I am an inflationist but not a green shoot believer at this time. I see the markets as being highly engineered.

  • 257 Lachlan // Jun 22, 2011 at 5:11 pm

    If a stock hits a solid long term support then I would buy even if the market index looks like it has not bottomed. Some stocks have done that, others have not. If there is a harder pull-back into deeper support areas I would spend a few more dollars there too.

  • 258 Plornt // Jun 22, 2011 at 8:37 pm

    “If there is a harder pull-back into deeper support areas I would spend a few more dollars there too.”

    Emotionally I know i’d panic on a further capitulation, so I try to avoid being stuck having to average down.
    But we do what works for us individually allowing for our emotional makeup and what we can realistically do in a situation.

    “If there is a harder pull-back into deeper support areas I would spend a few more dollars there too.”

    Well if you manage your money correctly, that works aswell, provided its not a value trap.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 259 Greg Atkinson // Jun 23, 2011 at 8:01 am

    Ned I am also trapped under a pile of paper as I try and sort things out for the taxman. I generally stay clear of the stock market in June unless I spot some stock(s) being oversold as investors tidy things up for the end of the FY.

    If we were in the midst of a bull market where stocks were trending upwards I might be tempted to be a buyer – but in a market that is going sideways I don’t see any need to jump in take on extra risk.

  • 260 Ned S // Jun 23, 2011 at 1:12 pm

    “I generally stay clear of the stock market in June”

    Never having been a stock market investor, I suspect I hadn’t heard the “Sell in May and go away” thing Greg. (Or if I had, it had never really registered.)
    So I typically found I was less than impressed with the immediate results as I dumped money into super in May and June to beat the 30 June contribution deadline each financial year – “Live and learn” as they say … :)

  • 261 Biker // Jun 23, 2011 at 1:44 pm

    Ned: “I dumped money into super in May and June to beat the 30 June contribution deadline”

    Missus did the same, Ned. Salpacked nearly all of it, in fact!
    She’s 100% cash, with no tax on earnings.

    Might have commented that I left just $1K in mine (to enable trouble-free CGT rollovers)… allocating ‘the whole grand’ to ASX (ie., indexed funds). It’s worth $918 today… . :D

  • 262 Plornt // Jun 23, 2011 at 2:10 pm

    Ned, you’ve avoided investing into it this time :)
    Although in 2009 i invested into the May and go away fears, it doesn’t always work, especially if the markets have corrected heavily.

    The most important thing with the markets is what you do under pressure and what you do in big situations and in bear markets. Knowing alot about the markets is not enough. Hesitation and indecision will kill you. If you cant accept losses nor take them even if you are right, you shouldn’t be playing (excludes very longterm investments).

    Thinking you are better than everyone will squash you like a bug, yet so many people think they are the worlds greatest, with dellusions of grandeur. Your weaknesses are exposed in bear markets, so if you are not honest with yourself, you’ll get crushed. Confidence is dangerous in bear markets, and most investors/traders these days are gambling. I know I was in the past.

    Defence wins games is the mantra this year. I hate losing money. I loathe it. I’ve still avoided a drawdown, but expect one even though i’m hedged for further falls with longterm shorts, and only have one equity long position.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 263 Plornt // Jun 23, 2011 at 2:23 pm

    “No stops here. Mr Market eats those for lunch.”

    I occasionally use a statistical stop from a backtested system. If it goes outside the statistical maximum losses for the backtested period, ya exit.
    Its not based on support levels or anything, which means its not targeted by the traders.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 264 Plornt // Jun 23, 2011 at 2:25 pm

    So you have a system and the backtested maximum loss from entry ranges from 5-10%. So you know if the losses go outside 10% from the entry, that something is wrong and the statistical data you relied upon to trade with is no longer valid.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 265 Ned S // Jun 23, 2011 at 4:39 pm

    Biker: “Missus did the same, Ned. Salpacked nearly all of it, in fact!
    She’s 100% cash, with no tax on earnings.”

    If one is going to push money into super in May and June, a cash option is definitely the go Biker; Unless one really feels they know what they are doing with shares – And I don’t.

    Biker: “Might have commented that I left just $1K in mine (to enable trouble-free CGT rollovers)… allocating ‘the whole grand’ to ASX (ie., indexed funds). It’s worth $918 today”

    Despite having my own SMSF, I’ve got a small Qsuper account with a couple of thou in it – In cash! :) From back in “the good old days” when I was a government employee. Qsuper aren’t great, but they seem to do as well or even a bit better than most? – Most of the time??? It’s a handy account to have just in case the SMSF thing should ever become too much of a hassle for me and I decide I’m happy to whack the funds into QSuper and pay them to do the paperwork to drip feed them to me in the future.

    Plornt: “Although in 2009 i invested into the May and go away fears, it doesn’t always work, especially if the markets have corrected heavily.” and “Thinking you are better than everyone will squash you like a bug, yet so many people think they are the worlds greatest, with dellusions of grandeur.”

    Yes, there’s no guarantees with any “system” as such Plornt. Though if one is going to play (I don’t) it would seem to be absolutely essential to be able to ditch one’s ideas about what the market “should” be doing when it is damned obvious it’s doing something different.

    It’s a tough one for many of us I guess? The temptation is to stick with one’s own carefully and logically thought out ideas. At least part of it is because in our usual “jobs” we expect to be right (and are expected to be right), pretty much all the time – If we are any good at them. But with stocks, if one can be correct even 66% of the time, that’s extremely good and one can make serious money with that sort of success rate I gather?

    So a whole different mindset has to adopted to what one is used to using in a “job” to benchmark one’s overall view of what constitutes success as opposed to failure against I think?

  • 266 Biker // Jun 23, 2011 at 5:38 pm

    One reason I allocated that $1K to ASX is that I wanted to demonstrate how crazy it would be for the missus to switch from cash to shares*, Ned.

    I figure our eldest is down _at least_ $100K this year… although his indexed funds have some kind of global-weighting… and he does very strange things with dividends!~

    Packing for Canada, US, Alaska and Mexico.

    * In a total sharemarket collapse, I’d switch her cash to Super again. Could never wish for such a correction. Too many would be
    incinerated. My kid assures me he’d only be toasted lightly. ;)

  • 267 Plornt // Jun 23, 2011 at 6:03 pm

    “It’s a tough one for many of us I guess? The temptation is to stick with one’s own carefully and logically thought out ideas. At least part of it is because in our usual “jobs” we expect to be right (and are expected to be right), pretty much all the time – If we are any good at them. But with stocks, if one can be correct even 66% of the time, that’s extremely good and one can make serious money with that sort of success rate I gather?”

    I remember seeing a documentary about a doctor who traded and he couldn’t cut his losses properly, because he couldn’t admit mistakes. I guess you can’t be wrong in medicine, so that translated into his trading.

    Most people who trade/invest work at the sametime, so knowing what someone does for a living does help in determining how someone will fair. Obviously psychological makeup plays a part aswell. Its amazing how many people have traded and failed. Its like a line of sheep continuously comming in to get slaughtered by the pros.

    I have to question who really is making money alot of time, because statistically its very small. I suspect alot of people are inflating their returns. I mean if a really good hedgefund with 30 million in funds can only make 7% p.a. in 10 years in the states, the retail investor must have done worse. And 7% p.a. over 10 years is very good for a market going nowhere.

    I’ve seen how good some of the top traders and investors are, and its very ego shattering! You kinda feel like a little ant afterwards. Alot of them go in disguise as idiots or mask as retail investors.

    The more i trade/invest the more i realise I don’t know much. I am a patsy and embrace my patsiness. It probably takes 10 years to really master trading/investing and become consistent; the learning curve is brutal and those who think its easy are setup for failure!

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 268 Plornt // Jun 23, 2011 at 6:20 pm

    But if you go step by step, let the criticism drive you to do better, you’ll get there ;). Got to love the haters who want to see you fail, it provides motivation to go harder.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 269 Biker // Jun 23, 2011 at 8:00 pm

    I made pocket money from shares for about five years. In the sixth year I took a hit, losing $55K when a company went *bust*

    What did I learn from that first… and so far…only loss in my/our financial history?

    * A corrupt board (and it was!) can beat you every time;

    * Stay with what you _really_ know;

    * Emotion really has no place in share trading;

    * Catching a falling knife appears to work better for me
    with property… although switching from cash-to-shares
    in a total _utter_ collapse has been profitable!

    Fortunately, the year I blew $55K, I made four times as much on a block of land.

    Thankfully, I was forgiven by the stockbroker’s grandchild!~ :D

  • 270 Plornt // Jun 23, 2011 at 8:42 pm

    Thanks for sharing Biker, some good lessons there.
    I think sticking to what you are good at is the biggie.
    But its important to be actually good at it, instead of just lucky.

    My biggest lessons from trading/investing:

    1) Never average losses down
    2) Don’t trade or invest without an edge. Make sure that edge is statistically proven.
    3) Push your winners hard and cut losses quickly
    4) Always think about the other side of the transaction and why they are selling.
    5) Admit mistakes quickly.
    6) Don’t try and understand everything, its impossible and alot of it is unnecessary
    7) Most people lose money, even though everyone acts elite lol.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 271 Greg Atkinson // Jun 24, 2011 at 8:47 am

    Let’s drift back to the purpose of the thread…i.e Australian stock market outlook ;)

    From The Australian today:


    “…it is worthwhile noting that the All Ordinaries is back to September 2009 levels, but still up 10 per cent from the beginning of this financial year.

    But for investors this market volatility still means that your portfolio and superannuation probably have not done too much in the past 18 months and are still well behind.”

    Full article: Warning bells ringing loud and clear

    So the question is; What is the stock market likely to do over the next 18 months?

  • 272 Plornt // Jun 24, 2011 at 9:23 am

    “So the question is; What is the stock market likely to do over the next 18 months?”

    Hmm, i’d say up in 2011 and 2012 using the data i’ve looked at historically. Although the data I use is averages, so it doesn’t pickup major reversals (i.e. it recorded a positive year in 87, even though markets collpased). There will have to be some sort of major clear out, just like the 1976 DJIA crash. The fact that precious metals are rallying and begining a bull market as equities go backwards — history is rhyming again.

    Looking at the DJIA, that hammer candle is bearish not a bottom, its a hangman. Those candles at the start of capitulation usually mean the index will head there at some point, and high probability it will go further than the lowest wick, so this means the bottom is now confirmed to be below 11,874.

    You can’t rally over 100% and only correct less than 10%. In 1976 there was a ~40+ month downturn that resulted in a 27% correction, after a very big bull run. Additionally precious metals began a 4 year bull market from 1976-1980 (its rhyming again now). We’ve gone up further than that period, so one would assume we could crash further. That would mean DJIA nearer to 8,000 on the dow. IF that occured, that would be disastrous for the XAO.

    I’ve not talked crashes for over 2 years and was not talking about crashes when everyone was doom and gloom. So I don’t say these things lightly. But it might take 3 years to get to 8,000, with lower high rallies, through a topping phase where everyone gets drawn into buying “bargains” getting slaughtered over and over with a slow death.

    My shorting hedge system that i’ve just setup is now picking up major mutlimonth reversals. We’ll see what happens.

    I’m staying long oil, silver, gold, aud, and overall short equities as a hedge.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 273 Leigh // Jun 24, 2011 at 3:30 pm

    Silver seems to be a constant theme in this discussion which reminded me of a 1980′s rush on silver. The mineral itself was being bought up and the price was climbing. U.S investigators traced it to the large feet of the Bunker-Hunt boys. Billy Bunker-Hunt and Bobby Bunker-Hunt Texas Oil millionaires who were slowly cornering the silver market. They claimed they just liked silver and when asked how much they might be worth one of them replied, “Anyone knows how much they’s worth can’t be worth too much.”
    The Stock Market? I have given up caring about it’s ups and down and simply look for a solid fully franked dividend.
    Leigh

  • 274 Plornt // Jun 24, 2011 at 8:14 pm

    Silver gold ratio is currently ~43.

    During the 1976 – 1980 bull market in precious metals, the ratio fell from 40:1 to 17:1

    Gold / Silver seasonality is favourable from July onwards.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 275 Biker // Jun 24, 2011 at 11:02 pm

    Plornt: “During the 1976 – 1980 bull market in precious metals, the ratio fell from 40:1 to 17:1″

    You really can’t discount the Hunt Brothers’ almost feral accumulation of silver during that very same period, Plornt.
    It’s likely that the push to replace silver halides in photography began after processing costs blew out, due to their monopoly on the market. I remember photo labs starting to fit silver halide recycling filters by the end of the seventies!

    We like silver… and I have a nice collection of silver coins dating from around 1600… but only fear can be driving current
    ‘values’. We also like sterling silver… and we pick up a few more nice pieces during each visit to Mexico… but I’m unlikely to ever buy any real quantity to hoard. No objection to others doing so, but we’ve seen a couple of boom-to-bust cycles in PMs over the last few decades… .

  • 276 Ned S // Jun 25, 2011 at 12:51 am

    Just a thought Plornt (which you may well have factored in anyway), but don’t get TOO enamoured with what any index (eg the DJIA) might have done historically maybe? Reason I suggest same is that the DJIA members get outed with replacements (that presumably have better prospects?) added to replace them in especially nasty crashes that cause major company bankruptcies – As opposed to the 1987 thing which was MAYBE a bit more of a flash in the pan type thing MAYBE than some of the others – Though I DON’T especially follow stocks as I’ve said so can’t swear to that?

    It’s just my concern that if one follows the history of indices too closely, they may not necessarily be comparing apples with apples when it comes to different historical corrections and the severity of their effects on the real economy in that the indices are in themselves quite artificial over time is my strong suspicion/impression?

  • 277 Greg Atkinson // Jun 25, 2011 at 7:12 am

    Ned your point about watching the All Ords, ASX 200 and Dow Jones too closely is a valid one in my opinion. Dud stocks are tossed out of these indexes and in the case of the ASX 200 it’s really a club of the top companies. I actually don’t go back too far when making comparisons about the stock market, real estate market or any market actually because the situation today is a lot different to what it was say 30 years ago.

    The long term charts are useful to look at, but I think it is wise to appreciate their limitations.

  • 278 Plornt // Jun 25, 2011 at 9:13 am

    “Just a thought Plornt (which you may well have factored in anyway), but don’t get TOO enamoured with what any index (eg the DJIA) might have done historically maybe?”

    Yep you are right Ned, and i’ve thought about this before. The way i predicted the DJIA returns in 2010 was using over 100 years of returns and I found a stastical pattern. So using historical returns over many years works for predicting index returns.

    So although i’m looking at indexes, my investments are driven by what statistically is probable based on 100+ years of data, not what happens during a snapshot period historically. Its just me tangenting again lol. I find it interesting I guess.

    When I run my statistical trades, after determining which way the index will go, I only go back 11 years or more as the patterns 20 years ago are not relevant to todays markets. I saw this problem aswell so I dropped the timeframes down.

    But remember Paul Tudor Jones simply used the 1929 correlation to make alot of money in the 97 crash and the Japan 1991 bubble equities crash. So simple does work at times.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 279 Plornt // Jun 25, 2011 at 9:15 am

    should be 87 crash not 97

  • 280 Plornt // Jun 25, 2011 at 9:23 am

    “The Stock Market? I have given up caring about it’s ups and down and simply look for a solid fully franked dividend.”

    Leigh that works aswell. If you have something that works for you, nothing wrong with continuing to do that.

    Looks like gold is correcting. I think gold is in a longterm bull market, but silver may be the leading indicator for gold and we may see gold have a temporary pullback here. I dumped my direct gold exposure and will wait for a trend to form before getting back in.
    But clearly gold and silver are in a bullmarket, and gold equities are mispriced, no doubt about that.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 281 Plornt // Jun 25, 2011 at 10:09 am

    “We also like sterling silver… and we pick up a few more nice pieces during each visit to Mexico… but I’m unlikely to ever buy any real quantity to hoard. No objection to others doing so, but we’ve seen a couple of boom-to-bust cycles in PMs over the last few decades… .”

    You are right silver will bust at some stage and as Greg pointed out the market will likely freeze and become illiquid, lock limit down perhaps.

    I tend to concur with Jim Rogers in that silver and gold can’t be in bubbles yet if they are not even above inflation adjusted highs.
    I think thats ~120-140 and 2000+ respectively. So one would assume if it was in a bubble you’d need to go drastically above these levels. Thats not to say you couldn’t have a correction in gold. You could easily see 1,400 Gold and then 2,000+. No doubt as it hits 1,400 all the bears will come out :P

    Alot of the public are yet to invest in PMs, which is another alarm bell for people calling it a bubble.

    If i’m wrong my defence will kick in and take me out of it quickly. If i can’t get out and i’m stuck holding physical or the futures market is too illiquid to get out of, i’ll hedge it with puts/shorts or something that will cut my downside risk.

    My system stop is 31.5, if it breaks that, then the statistical data i relied upon is nolonger relevant and i’ll exit and admit I was wrong. So i’m risking ~10% to have the possibility of making 500-100% longterm. I also have puts at 34$ which cuts my risk down to 2-3%.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 282 Plornt // Jun 25, 2011 at 10:20 am

    http://3.bp.blogspot.com/_jOCCCQVK2mI/TOyEz99XJEI/AAAAAAAAAC8/EOvmXtgoEVg/s1600/bubble.png

    Id say PMs are either in the Awareness phase or in the beginings of the Mania phase. Given alot of the public have not invested in PMs and the public in general are not enthusiastic about it, i’d say we are more likely in the Bear trap awareness phase. Especially since silver has tanked 30% and my system is giving a buy signal on it.

    The alternative argument is we are in the blowoff phase and the rise is a bull trap. That is a possibility aswell.

    This shows gold to the exuberance in the tech wreck markets. Perhaps not the greatest comparison. A better chart would be in comparison to other bubbles what are the valuations like and how much of the public were invested back then at that top relative to now. I’m assuming Jim Rogers has already looked at this when saying gold and silver are not in bubbles.

    http://www.myglobalinvestments.com/goldsilver/assets/images/Acharts_MAAG.gif

  • 283 Plornt // Jun 25, 2011 at 10:23 am

    The public in general are not heavily invested in precious metals through Mutual Funds (as seen in chart 2 of the second link in post above), which would be a huge red light on the bubble arguments.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 284 Plornt // Jun 25, 2011 at 10:49 am

    “The long term charts are useful to look at, but I think it is wise to appreciate their limitations.”

    Thats true. The patterns on longterm charts can have similarities though, but are by no means without faults. If you used a 6month chart now and compared the patterns on that to something in 1987 likely the patterns that occured in 87 may not work anymore. Reason being alot of smart individuals would have already extracted that edge to the point where the edge either doesn’t work anymore or even does the reverse.
    But if you compare the patterns on a 30 year charts over a longterm conglomerate, there are patterns there that hold true over decades.
    Perhaps the reason this is possible is because most people are too short a time frame, so they tend to concentrate on charts with much lesser time frames.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 285 Plornt // Jun 25, 2011 at 11:20 am

    “It’s just my concern that if one follows the history of indices too closely, they may not necessarily be comparing apples with apples when it comes to different historical corrections and the severity of their effects on the real economy in that the indices are in themselves quite artificial over time is my strong suspicion/impression?”

    Well for instance if I was following a longterm pattern or correlation and the correlation started to break, i’d look at what was happening in lots of places currently, e.g. economic data, sentiment, cash levels of retail investors, what institutions are doing.
    So say the correlation is 87 and says it should go down more. But economic data is very bullish and my system has many buy signals, retail investors have alot of cash, sentiment is extremely poor, vix has topped, put/call ratio shows too much fear. I’d say the 87 correlation is broken and move away from it.
    I don’t get tied to my ideas unless they stay right.

    I guess this isn’t an exact science and there is alot of discretion involved even with a system. Plenty of faults. Investing is probably more of an art where uncertainty and unreliability of consistent returns are a constant.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 286 Lachlan // Jun 25, 2011 at 3:27 pm

    Upside breakout in AUD gold price very soon now Plornt. Gold shares will be even more under valued :)

  • 287 Lachlan // Jun 25, 2011 at 3:28 pm

    Mate you seem to have done your homework anyhow. All the best.

  • 288 Plornt // Jun 25, 2011 at 3:44 pm

    “Upside breakout in AUD gold price very soon now Plornt. Gold shares will be even more under valued ”

    If that happens i’ll enter and miss some of the move. But longterm its obvious gold equities will do great. Buy the dips will work (albeit be prepared for drawdowns)
    I just have a rule in making sure I avoid drawdowns during corrections, hence i’m being neurotically defensive and unwilling to take risk.

    Goodluck to you aswell Lachlan, you seem to be investing in the right areas and have good knowledge of TA and money management.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 289 Lachlan // Jun 27, 2011 at 8:16 am

    There is a very neat down trend in place from the top of our XJO trading range to the current close around 4500 . Although anything is possible here Plornt I’m wondering whether we might see a rapid capitulation to the bottom of the range around 4300 to 4200… to give everyone a fright before any reversal occurs.
    Sorry, I enjoy all these market dramas ;)

  • 290 Plornt // Jun 27, 2011 at 12:54 pm

    Looks terrible Lachlan. But as you say anything can happen.
    No idea where this will stop. But I’m not touching this until i see a confirmed bottom. I’ll be very late if need be.

    I’m thinking at LEAST 11,600 on the DJIA. XAO not sure. If we go down more than 20% its a bear market, so anything below 4,000 is bad news.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 291 Plornt // Jun 27, 2011 at 1:46 pm

    Lach keep an eye on the Range to break. What might happen is we hit support around 4,200 and the have a weak bounce for a few months, then new lows to 3,700. Very tricky market.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 292 Lachlan // Jun 27, 2011 at 4:40 pm

    Whoo hoo watch out below now Plornt. PM’s getting smashed and I’m getting my wallet ready. Silver out of its pennant to the downside but could still could find support in the 33′s…I’m hoping for 31 or a touch less and weakening a little in AUD’s also. Gold below 1500 right now.
    AUD/USD I am reckoning will go to 1.025, 1.03 support soon.

    If we ever go to 3700 though those support areas will wiped out of course.
    I favour a bounce back into the upper range from 4200 myself but if we go lower anyhow than I’ve said many times before we won’t see lower than March 09 lows around 3100. 3700 is a nice pivot and many would be bearish below that but I guess that the market could run the stops below there and bounce from a little lower when everybody has gone bear.
    Get your chips and dip ready Plornt.

  • 293 Plornt // Jun 27, 2011 at 5:08 pm

    This is begining to look nasty.

    The speculative area is just being smashed. Small caps are dangerous, as i’ve been harping on ad infinitum.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 294 Lachlan // Jun 27, 2011 at 6:43 pm

    Might be best to only take on a little more Ag around 30 and then wait to see if we get back to low 20′s. Usually these breakouts do retrace most. Luckily mostly what I have I bought before that big run up from 20. If/when we see QE3 then Ag will head back up fast.

  • 295 Lachlan // Jun 28, 2011 at 7:05 am

    My rough estimates for bottoms will be intraday
    aud 1.03
    Au 1465
    dow 11600
    coming soon to a market near you
    I am buying some more shares today Plornt but just small no.s for keeps through the Au bull market…mainly hard assets here.

  • 296 Lachlan // Jun 28, 2011 at 7:09 am

    oops xjo to 4320

  • 297 Greg Atkinson // Jul 29, 2011 at 1:19 pm

    The All Ords is struggling to hold above 4500 and the ASX 200 (XJO)is currently at 4425. Looks like you made some good calls Lachlan!

  • 298 Lachlan // Jul 30, 2011 at 7:36 am

    I’m still waiting for a final gap lower Greg if that’s what is to be. We saw just in to the 4390s last night before a slightly higher close.
    DXY has broken downside of its little pennant and now possibly headed for a 72.83 retest. So US dollar weakness, AUD strength and XJO weighed down again.
    I’m treating this whole area as a favourable accumulation zone however I’m buy and hold. Still risky for short term traders except for some individual shares maybe.

    If the market goes even lower say below 4215 then some real panic should set in and buying opportunities will be immense imo.

  • 299 Greg Atkinson // Jul 31, 2011 at 9:59 am

    Lachlan I sense that Monday could be the day we get near a 12 month low and that sometime after that a relief rally might not be that far away.

    The problem is that a movement in the market from say 4400 back up to 4800 is not much of a reward for taking a risk and buying into stocks right now..especially when you can park cash in a nice term deposit.

    In the back of my mind I know that investors will sell shares at the drop of a hat if there is even just a rumour that the Chinese economy is slowly quickly or on further bad news from the US or Europe.

    The risk versus reward equation doesn’t look too good right now.

  • 300 Biker // Jul 31, 2011 at 2:36 pm

    Your continuous fixation on China is persistent, Greg.

    Nearly _everyone_ else is looking in a different direction.

    You are a true contrarian.

  • 301 Lachlan // Jul 31, 2011 at 4:28 pm

    Well I think we could do better than go long this particular index here Greg but to be honest I’m hoping (not necessarily predicting) the future (12 months out) might be a break from this compacted little range to 5700 and beyond and lower rates too. It seems to me the MSM here have definitely gone bearish plus there are some technical indicators I see. Maybe we would all like to see lower rates at this point? The blunt tool can go too far requiring a trim back. Only Glenn is worried about bananas. Or is that just Wayne ;)

  • 302 Lachlan // Jul 31, 2011 at 4:38 pm

    Too many cashed up Aussies bidding for fruit ya know ;)

  • 303 Greg Atkinson // Jul 31, 2011 at 6:24 pm

    Well Biker for me China is quite close..just an hours flight away in fact so it is in my backyard so to speak. We have a pretty good view of the mess in Europe and the U.S but I doubt we really have good grasp on what is happening in China.

    But yes, I am a bit of a contrarian. I just wish I was more so back in 2007 :)

  • 304 Greg Atkinson // Jul 31, 2011 at 6:28 pm

    Lachlan if I see rates head down then that would give me some confidence that we might see a long term bull market start to take hold again. I would even be more confident if Wayne and Glenn found a new day job :)

    Next week is going to be very interesting. Let’s see how much more the U.S is going to borrow.

  • 305 Lachlan // Jul 31, 2011 at 8:02 pm

    Yes Greg I must admit I missed the contrarian thing too in regards to the markets a few years back. My fear of losing money to a second leg down caused me to give up great shares which took off in many cases. Must admit many of them did pull back hard eventually.

    For BP, here is (or was) a high upside property deal for you. New coal mining area. Follow the Asia boom money.

    From the Central Queensland News 8th June 2011.

    “ACCORDING to Blackwater business owner Dave Hills, Alpha is the place to invest.”

    “Recent State Government figures showed residential land prices in the central-west town had risen 2979% since 2007, suggesting Mr Hills was not the only one interested in getting a piece of the Alpha pie.”

    “In dollar terms – the average value of residential land in Alpha increased from $2926 to $90,106 in just three years.”

    I’m following the Alpha story for other reasons but in hindsight, what a deal.

  • 306 Ned S // Jul 31, 2011 at 8:28 pm

    Lachlan: “Maybe we would all like to see lower rates at this point?”

    Greg: “if I see rates head down then that would give me some confidence”

    You pair speak for yourselves – I’m basically reliant on bank interest rates for my income ta very muchly! :D :D :D

  • 307 Biker // Aug 1, 2011 at 1:10 am

    Very interesting week, as you say, Greg!~
    DR’s view appears to be that it really doesn’t matter much
    what happens on Tuesday. The bigger picture means d-o-o-o-o-m.

    Doubt our interest rates will rise.
    Eslake’s view is probably correct…
    Stevens’ safest position is simply to do nothing.

    No interest in coal, I’m afraid, Lachlan.
    Can’t see anything long-term there.
    Check Collie (WA) prices… .

    Enjoying our view from the deck of a resort on Gabriola Island.
    Below us, cruise ships and ferries ply between the gulf islands.
    Sometimes wonder if my optimism might be misplaced, but it all
    looks pretty good to us at the moment…*

    * Fool’s paradise??!~ ;)

  • 308 Lachlan // Aug 1, 2011 at 6:40 am

    Yeah Alpha’s no lifestyle place BP but just a punt on coal. And I could handle throwing a few K at a block there expecting I might lose it but not 90K. Lifestyle…Agnes waters is one of my favourite little haunts for long weekends with the kids. They absolutely love the place.

  • 309 Lachlan // Aug 1, 2011 at 6:50 am

    Agree markets will be interesting this week Greg. Heading off for bush now but got a dusty old TV I found in an abandoned farm house to watch at night. When companies buy out small blocks these houses get left for useless and I’m allowed to stay in exchange for some maintenance jobs etc. It’s always great to get home to the net and hunt down all the better info available. Anyhow hoping to see XJO finish its move down with a break into bear territory before flushing out longs and reversing in sync with the (inevitable as I see it) debt ceiling resolution.
    Cheers till then.

  • 310 Lachlan // Aug 1, 2011 at 6:51 am

    Apologies for my interest rate remark Ned. Carry on ;)

  • 311 Greg Atkinson // Aug 1, 2011 at 8:46 am

    The Australian stock market will be going along for the ride for the next few weeks and probably even months. I doubt local economic news will move the market much and that events in Europe and the US will move the All Ords/ASX 200 around.

    As for the U.S debt Biker, well I heard that 40c out of every dollar the U.S government spends is borrowed money so raising the debt ceiling isn’t going to do much to fix the long term problems the economy faces there.

    All in all it’s going to be tough for the All Ords to close near 5000 this year.

  • 312 Biker // Aug 1, 2011 at 1:44 pm

    Greg: “All in all it’s going to be tough for the All Ords to close near 5000 this year.”

    Yes, you probably called that one right, Greg!~

  • 313 Ned S // Aug 2, 2011 at 9:44 pm

    Stagflation anyone? – Well, as a best case scenario anyway … :)

  • 314 Greg Atkinson // Aug 3, 2011 at 10:01 am

    Well the post debt deal rally appears to have lasted all of one day and we are now heading back down again. It’s hard to think of how the outlook for stocks could be any bleaker at the moment.

    As for stagflation Ned, my view is that this is probably not likely as if the U.S and European economies remain in the doldrums then the Chinese economy will definitely slow. The Chinese economy can’t keep soaring when it’s major export customer’s are spending less.

    If that happens then commodity prices for iron ore and coal will slump, oil prices will remain under $100 and so a lot of the inflationary pressures will be taken out of the system. (in Australian that is)

    I won’t speculate on what banana prices will do though ;)

  • 315 Senator13 // Aug 3, 2011 at 10:42 am

    It looks that way, Ned. I do not think we are going anywhere anytime soon…

    All Ords taking a pounding today. Almost at 4400 as I type.

  • 316 Ned S // Aug 3, 2011 at 11:28 am

    Seems that the good ole US of A is likely to go into recession without coming out of the last one. Can China keep growing regardless? Maybe not at the same rate Greg? But they were intentionally cooling growth last I heard so lack of growth hasn’t been a problem to them – Not to date anyway. And unless the US puts up trade barriers, the Chinese are going to continue to outcompete the US for a useful portion of the US consumers’ spend anyway. (One fact that doesn’t get spoken about much, is since the GFC the US’ share of global GDP went from 24% to 19% with it being a pretty safe bet that Asia has picked up the bulk of what the US has lost I’d say?)

    Re inflationary pressure in Oz: Much of it is coming from our three levels of gov – Local council rates, car rego etc. More regulatory costs all the time – We are going to get stuck with paying to have a “green” rating assigned to one’s house before you can sell or rent it is the most recent. And the carbon tax is hardly likely to push prices down hey? Plus we’ve got all the suppliers of services one pretty much can’t get by without (insurance/water/electricity – health even though I’ve not specifically checked that one but expect if it isn’t the case it will happen) who keep putting the cost of their services up. Nope, we’ve got inflation happening and even if the mining boom doesn’t go as gangbusters as it might have without the Old World (which includes the US these days) weighing it down, we’ve got plenty more to look forward to from that direction regardless I’d say?

    Though trade barriers would be a game changer I guess???

  • 317 Lachlan // Aug 4, 2011 at 10:10 pm

    Wow it’s all happening.
    Glad that rally died Greg. My 4320 bottom never got reached. Except we are today about 80 points lower than that.
    Of the individual shares I follow a few have made reversals over the last 4weeks or so while many have continued bear charts in short term. Hopefully now we are getting to 4200ish (bottom of the range trade) we’ll get a bigger panic and the selling will exhaust. Hopefully.
    At this moment the DXY is trading into resistance and the AUD/USD into support after a sharp sell off. Maybe we’ll get reversals. Either way someone somewhere is doomed hoo hoo ha ha ha. Oh its all so exciting ;)

  • 318 Lachlan // Aug 4, 2011 at 10:14 pm

    Very good last post Ned….imo anyhow. Mining is going crazy just west of you at least I can vouch.

  • 319 Lachlan // Aug 4, 2011 at 10:15 pm

    Time to buy cheap gas stocks maybe ;)

  • 320 Ned S // Aug 4, 2011 at 11:30 pm

    Things tend to drop off the radar screen in amongst the developed world trying to figure out what it’s going to do about the fact that it seems to be not just broke, but unsustainably broke Lachlan. As Greg has pointed out in the past, the Oz media has a pretty narrow focus. Lots of interesting things happening in the Arab world still apparently. Though they could take a good while yet to play out. But then maybe not? But either way, things there are not stable. And I’m not at all sure the West is in the position it once was to do a whole lot about it? Some very real pressures could come to bear on energy supplies:

    http://www.theaustralian.com.au/news/opinion/chill-winds-blow-for-arab-spring/story-e6frg6zo-1226107702792

  • 321 Ned S // Aug 5, 2011 at 1:37 am

    FTSE down 3.43%
    And the DJIA is certainly struggling.
    Superficial reading has to be that there’s another recession brewing no?
    Any sort of Middle East oil supply shock could make things very ugly I imagine?
    Where’s a strong stable leader like Saddam Hussein when we need him? Oh, that’s right … He told the Yanks he wanted to accept other currencies for his oil as well – And we topped him. Damn! :)

  • 322 Lachlan // Aug 5, 2011 at 6:05 am

    Democracy got him Ned ;)

    Woh 4121 now on the index. This has to be a final panic move surely. Look out for QE3 maybe.

  • 323 Lachlan // Aug 5, 2011 at 6:35 am

    What a volatile night.

    Apparently Gaddafi wants a new currency too Ned…gold backed dinar or something. A currency terrorist. Control over money is a means to tax in various ways.
    I’m sure these fellows are tyrants mind you but then there’s nothing new under the sun there either.

    Regarding this unsustainably broke thing Ned, yes that’s true. However I’m not so bearish down the track further for Oz, at least I prefer not to be since none of us knows for sure. At some stage we may see crisis give way to a new financial system that few people right now believe possible. I’m not saying I want it, just observing. The crisis is over accounting trickery and currencies that are created from thin air by banks and governments who apparently seem to know they can get away with it. But its the assets that change hands which are the key I believe. Mining, agricultural, industrial and monetary (PM’s) assets are being concentrated into more powerful hands. Nothing new under the sun once again.
    Anyhow that’s about as far as I go with conspiracies since much of it deals with perception rather than hard evidence….not that perception is invalid, far from, but we should weight these things appropriately.

    I think trends are more relevant of course. Crisis equals more money printing and inflation is a prominent one in my book ;)
    Cheers Ned.

  • 324 Greg Atkinson // Aug 5, 2011 at 9:31 am

    Well the good old Baltic Dry Index (BDI) was telling us that the stock markets had rallied too far but plenty of “experts” these days reckon the BDI isn’t worth watching any more. Well they are quite clearly wrong.

    I am not in panic mode yet as the ASX All Ords/ASX 200 is not that far below 4400 to make me worried. We in fact still trading around a range that has been in place for more than a year. (so far it’s just a little dip outside that range..it has happened before)

    If the All Ords/ASX 200 were to close below 4000 then I would put on my worried hat though.

    What a good time to be thinking about a mining tax hey? ;)

  • 325 Ned S // Aug 5, 2011 at 9:47 am

    Think I’d describe it as violent rather than volatile Lachlan?

    Lots of issues alright. I personally think the West’s demographics issues will have a lot to do with things long term going forward as well. Stuff like unfunded pensions and health care for the aged. Plus the declining productivity as boomers and gen X retire – Which is going to go on over the next 30 years.

    Mining tax Greg? Yes, and a carbon tax. And all the other regs and red tape govs have introduced that increase costs to the consumer and reduce productivity and profitability – Somewhat overdone OH&S regs are just one that come to mind.

    All Ords/ASX 200 below 4K – If we don’t see a decent rally next week, we’ll all get to start worrying I’d say! :)

    Oh, and just between us and the gatepost, I could feel just a little bit better if Gillard stopped dicking around with the peripherals and did a few of the basics – Like deciding what the revised guarantee on bank deposits is going to be for example.

  • 326 Ned S // Aug 5, 2011 at 11:22 am

    The latest from the RBA:

    http://www.theaustralian.com.au/business/economics/reserve-bank-slashes-economic-growth-outlook-amid-persistent-inflation/story-e6frg926-1226109007244

    It’s all been caused by too much rain and not enough bananas obviously! ;)

    Though Wayne Swan reckons “She’ll be right mate” – So he reckons we’re still in with a chance of having less rain and more bananas next year maybe? :D

  • 327 Plornt // Aug 5, 2011 at 12:35 pm

    “Lach keep an eye on the Range to break. What might happen is we hit support around 4,200 and the have a weak bounce for a few months, then new lows to 3,700. Very tricky market.”

    Looks like 3,500-3,700, 10,200? on the XAO is the bottom perhaps?
    Full fledged crash unfolding here.

    Any relief rallies i’d get out of this mess. We should relief rally, but then this market is crashing.

    I’m waiting before I go long, and i’ll be late on it, who knows where this is going to stop.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 328 Plornt // Aug 5, 2011 at 1:21 pm

    hope everyone is ok out there

  • 329 Plornt // Aug 5, 2011 at 1:56 pm

    DX, big move comming. DJIA looks a good short on any major rebound.

    DX and precious metals may move upwards together. Silver target 70$ (could be wrong of course)

    Possible Targets: 3,500 XAO; 9400 ON DJIA

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 330 Plornt // Aug 5, 2011 at 2:13 pm

    Atm there appears to be alot of stuck longs who donnot want to sell, so there is just going to be alot of selling pressure onto any up moves here. Perhaps at best sideways action after a moderate rebound.

    Could be something like, 4000 bottom, then up 400 points till Late September, then just like the GFC, a 20% capitulation crash in October. Lots of scenarios and anything can happen. Cut your losses with velocity, you can always re-enter if you were wrong.

    We could just keep going down now aswell. 4056 on XAO means more than 20%, then we are officially in a bear market, meaning any rallies are counter-trend at best and unlikely to be more than 10%, until a bull market is confirmed, which usually takes several months of bottoming action to confirm. These things don’t rebound quickly.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 331 Ned S // Aug 5, 2011 at 3:18 pm

    “hope everyone is ok out there” – Ditto Plornt. I’m not invested. But I’ve got friends and family who are. It’s brutal.
    Thank gawd for Fridays as they say. I think? Because if the European and US markets don’t rally tonight, it could seem like a long wait until Monday.

    It all makes me wonder just how much enthusiasm all the upcoming retirees are going to continue to show for stocks.
    We know cash is a dead end bet – Or at least we’re supposed to think that way I gather? But the DJIA basically hasn’t shown any growth over the last decade. (Just having a quick look it’s spent at least as much time under 11,000 as above it.)

    Chuck in even another mild recession that pushes it down again this soon, and that could well and truly be the final straw for a lot I’d expect? (And there’s no guarantee that if another recession comes along right now it’s going to be a mild one.)

  • 332 Greg Atkinson // Aug 5, 2011 at 3:36 pm

    As bearish as I have been lately I am now starting to think we are in the oversold area. Generally speaking company earnings have not been fantastic but they have not been that terrible either. Most stocks were already battered before this weeks rout hit although the miners have been cut down to size with BHP trading today around $38.

    If the Dow falls again tonight then next week could get really ugly.

  • 333 Plornt // Aug 5, 2011 at 3:39 pm

    “Chuck in even another mild recession that pushes it down again this soon, and that could well and truly be the final straw for a lot I’d expect? ”

    Yep. Theres a catalyst right there. Also if rates continue to rise, retirees are going to move to bonds and cash en mass, putting alot of pressure on equity prices. Alot of them are sitting on alot of capital gains from the extraordinary multidecade asset bubble, fueled by debt.

    If George Soros is correct the next 20 years is going to be a “wealth destruction” period, where just holding onto what you have will be difficult. The times of big wealth creation are over. This has happened many times in history, and history will rhyme again even though people keep quoting the historical returns nonense. Warren Buffet is majorly diluting his shareholdings, Charlie Munger is selling his Berkshire stock, Bill Gates is dumping his Microsoft stock, Jim Rogers says another lost decade comming for America. Red flags are everywhere from people who have been bullish for along time previously.
    Will Australia be able to buck the trend, whilst America goes nowhere?

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 334 Plornt // Aug 5, 2011 at 3:47 pm

    “Generally speaking company earnings have not been fantastic but they have not been that terrible either.”

    Thats true, but logic doesn’t prevail, at least in the short term in these market conditions. Momentum is truly down now and you can’t stop a moving bus quickly.

    XAO is 18% down, and we finished near the session lows, we are probably in a bear market now.

    The market is like a whore lol. It will beat you up. Then when you are beaten up, it’ll kick you in the guts again. Then it’ll do it again and again. And then just as you see hope, it’ll beat you up again. Then when you’ve given up after many rays of hope, it’ll beat you one last time, then it will recover lol.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 335 Plornt // Aug 5, 2011 at 3:51 pm

    ““hope everyone is ok out there” – Ditto Plornt. I’m not invested. But I’ve got friends and family who are. It’s brutal.:

    Yeah lets hope people have a chance to get out before this gets uglier.
    I’m net short atm, but even that didn’t avoid me being down 1% for the year atm. My goal is to try and have a positive year this year. Not sure it will be possible if we go to 3,500!

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 336 Lachlan // Aug 5, 2011 at 5:18 pm

    G’day Plornt.
    This is just the sort of capitulation that could turn the market sharply upwards. Could be a little shake out on the bottom side of the flag before a move to the highs of the range and beyond.
    Congratulations though and well played on your short trade so far. Its not an easy game for sure.

  • 337 Lachlan // Aug 5, 2011 at 5:21 pm

    The one thing I see now is AUD gold breaking out from it’s pennant. I have calculated two wider scenarios which could involve this move. I’m hoping it does not take stocks to the basement though.

  • 338 Plornt // Aug 5, 2011 at 5:58 pm

    I’m not sure Lach. My shorts wern’t that successful as I was holding longs aswell. Longs did worse than my shorts, so i’m still down 1% overall.

    So much volatility right now, its dangerous to try and find an entry point. High probability that it will whip you out for loss after loss. I’ll wait for the volatility to calm down abit.
    Oil could go to 77-78? DX looks like a big bull run is about to commence, so that suggests a longterm reversal in stocks, if correlations hold.

    Doesn’t mean we wont bounce. We are oversold, and due for a bounce at some point. I’ll probably miss the bounce and keep with the bigger move on the short side.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 339 Lachlan // Aug 5, 2011 at 6:15 pm

    Here’s something Faber said off ZH Plornt (coincides with my own view of course)

    “He concludes that he can already smell QE3, and that the next week will be important to see if Bernanke is a true money printer or an amateur, and if he is a true money printer he will start printing soon.”

    I traded CFDs regularly for 18 months and barely slept Plornt. I loved it but it wore me out. It’s a manic game I reckon.

  • 340 Plornt // Aug 5, 2011 at 6:26 pm

    There wont be a QE3 anytime soon imo. We’d need a bear market crash to get one going, to justify yet another bailout of the economy. Maybe QE3 if DJIA went to 8,000.

    Historically you usually have major crashes coinciding with something similar but less viscious a few years later. So even a 50% fall from the amounts in the GFC is still a ~26% drop from the highs.

    “I traded CFDs regularly for 18 months and barely slept Plornt. I loved it but it wore me out. It’s a manic game I reckon.”

    I don’t do it much, the key is not to overtrade, you create too many frictional costs which causes a drag on returns.
    I couldn’t trade daily, god that would be terrible. I reckon it would be akin to me gambling. Sounds like you were good at it though!

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 341 Ned S // Aug 5, 2011 at 7:37 pm

    “the miners have been cut down to size with BHP trading today around $38″ – Unless they pay at least half respectable dividends (and they might? – I don’t follow individual stocks) – they wouldn’t be worth buying from where I sit Greg.

    Outside of dividends, individual stocks are a play on a combination of inflation and genuine shortage as I see it.

    While I’m in the inflation camp, does BHP mine anything that there is a genuine shortage of??? (I don’t know – Just asking. And treat it as a rhetorical question by all means because if I wanted to get into stocks I should certainly be a big enough boy to do my own homework.)

  • 342 Stillgotshoeson // Aug 5, 2011 at 8:22 pm

    Hey fellas, Rollercoaster ride today.. I think we will see QE3 in October quarter.

    BHP’s strength is its diverse portfolio Ned. I have 1000 BHP in my SMSF. I would be in no hurry to add more to my holdings, simply because I expect China totake a breather and that will see our resource stocks decline further than the current dip.

    Banks too do not interest me either, as I expect the market to be unkind to them as well. CBA report will not really be a bell weather indicator as the report covers a reasonably strong period, the 1/2 yearly report in early 2012 will be more of an indicator. The decline is in motion, it is just how quick it unfolds. I expect a bit of volatility still in the share market. I won’t rule out 5000 between now and Christmas. QE3 in October would just about do it.

    CGT is the killer in day trading, so many get caught out at tax time because of the CGT liabilities accrued come end of year.
    Turning over shares quickly in SMSF’s is less costly as far as CGT goes. 15% on a profit take is far better than a 40% or more depending on income outside of super.

    Lachlan a large break out in AUD gold will have to be bad for the stock market by default. A smaller break out will be less damaging.

    On a personal side, business number 1 is performing well and takings are 20% higher than “book” at purchase.
    Business 2 is not as well performing.. revamping in progress at the moment, hope to be back up and running by the next school holidays. Weekends and school holidays are the money spinners for it..

  • 343 Ned S // Aug 5, 2011 at 8:37 pm

    “The market is like a whore lol” – It’s my understanding that one is normally asked to pay very significantly extra for the sort of service you describe Plornt … :D ?

    Indeed the one time I hooked up with a lass in that line who was having a quiet nite and deemed to do a “straight” one (with that all being quite a few years back and me being a poverty stricken wowser now I hasten to add), she reckoned her usual clients were the likes of judges and barristers and surgeons and bankers. But truth be told they way more likely wanted her to dress them up in a nappy and let them help ‘Mummy’ hang out the washing she reckoned – Than do the things you mention???

    But I recommend keeping such thoughts in mind next time you have to front a judge regardless. Or are thinking about Ben Bernanke or Glen Stevens maybe? (Providing you aren’t an ESPECIALLY visual person perhaps!!! :D )

    Funny ole world in way more ways than one hey?

    Hmmm – The POMs are only down a bit over 2% – At least they’re making a fight of it for now.

    BHP – Ta Shoes – Noted.

  • 344 Lachlan // Aug 5, 2011 at 9:08 pm

    I gave it a very good go but it became too involving and intense. I loved the market atmosphere too and still do but that’s not a good enough reason to commit oneself to such a thing.

  • 345 Lachlan // Aug 5, 2011 at 9:18 pm

    You are a funny ol fellow Ned, I shall call you Humphrey. No I wont :)

  • 346 Plornt // Aug 5, 2011 at 9:40 pm

    Look at the volatility on this!

  • 347 Biker // Aug 5, 2011 at 11:44 pm

    Lachlan: “You are a funny ol fellow Ned…”

    There are even more amusing folk about, Lachlan!~ ;)

  • 348 Greg Atkinson // Aug 6, 2011 at 9:48 am

    The ASX All Ords/ASX 200 will need to post some gains this month otherwise it’s going to be hard for it to get back up around 4800 where it has liked to bounce around for a year or more.

    At this stage I am sticking with my forecast/guestimate for the year as per: Australian stock market outlook for 2011

    I still reckon the political mess in Australia is taking around 500 points off the market by the way but I have factored that into my numbers.

  • 349 Jimbo Jones // Aug 6, 2011 at 12:25 pm

    Just wanted to throw in a couple of comments:

    – A very amazing week: Interesting to say the least.
    – In the SPX 500 space, the only indicator left standing is a positive 200DMA line. Until it turns negative, i won’t scream bear. There have been many instances over the past where mid bull market corrections have occurred that have resulted in breaches of H&S patterns and lower lows, but the markets 200DMA line never turned negative, hence the bull market commenced within a few months.

    – On a negative side, most Asian markets are close to falling into bear market territory. A few European markets are also very close. Brazil, another commodities market is down about 25%. Inflation is an issue there, as are their industrial companies. Like Australia. (On a side note, i read a number of articles to avoid Brazil equity markets. Being a contrarian, it is boding well for Brazil to lead the recovery back up – which MAY be driven by a commodities run. This may prove a catalyst for a strong Australian rally in the coming months. (not withstanding further pain maybe?!?!)

    News commentary is certainly very bearish (Front page blood bath headlines). Always a contrarian indicator, but can also be meaningless in a long term bear.

    Greg, i agree, Gillard has wiped about 500 points for the Austrailan market. I guess another tax of hers!

  • 350 Plornt // Aug 6, 2011 at 2:24 pm

    Ok time to start panicing – Julia is telling everyone to remain calm on the US Debt downgrade situation -

    http://www.google.com/hostednews/afp/article/ALeqM5itmoWV_T6l_C7OkK9IEqmVu0fpdg?docId=CNG.7e885139e8a1bc75f092f9aeb91cef25.2a1

    When politicians tell you to remain calm, head for the exits!

    You’d think there should be some sort of bounce on the DJIA soon, before further lows set in. People switching out of USD in a panic driven short runnup? Or will stocks just continue down, instead of a bounce then new lows?

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 351 Ned S // Aug 6, 2011 at 2:49 pm

    As Plornt indicated, the DJIA volatility was pretty eye popping.

    It’s largely a question of whether the markets are responding to the fact they were overbought, or being driven by a conviction the world is headed back into recession isn’t it? Although it could simply be both. But if it’s predominantly the latter, then maybe the bottom is a good way off yet?

    Worse, is the possibility that the market is predominantly responding to the thought that all the major developed sovereigns (US and EU; Japan even???) are simply and unsustainably broke.

    Not helped by facts like the EU plan for going forward seems to be that Yes, while we are broke, we still expect private institutions to buy our bonds in the full knowledge and expectation they will be defaulted on and you will get to take haircuts when they are.

    If they’ve finally decided to respond to that, then I’d have to assume they are in for a real hammering???

    Ms Gillard could well be looking for a new job after the next election Plornt – Perhaps she fancies herself as a financial advisor and is getting in some practice …

  • 352 Plornt // Aug 6, 2011 at 3:54 pm

    “Ms Gillard could well be looking for a new job after the next election Plornt – Perhaps she fancies herself as a financial advisor and is getting in some practice …”

    :P lol.

    Looking at the indexes they are just too parabolic to sustain the downmove, you would think. If it keeps going down like this, without some sort of reflex rally, it will probably shorten the crash targets. Needs to coil back somewhat, then make another move down. But no need to rush back in, usually in these types of crashes, you have plenty of retests and horizontal movements to make a safe re-entry after confirmed trend reversals, when volatility calms down. The reflex coils can be extreme up and down, which is good for the pro traders, but not good for us mortals.

    “or being driven by a conviction the world is headed back into recession isn’t it?”
    Also remember markets can crash even if there is no recession, and have done this historically a few times. Looks like this might be a currency crisis induced crash, not a recession based one.

    Markets will look forward and anticipate, they are not paying attention to alot of the data right now when looking longer than the short-term.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 353 Plornt // Aug 6, 2011 at 9:53 pm

    Thanks Ned

  • 354 Lachlan // Aug 7, 2011 at 9:20 pm

    Shoes…Good to hear your enterprises are off to a quick start even if one does require a tweak. Christmas holidays might pay off well for you then in sync with an end of year commodities rally I hope. Double the joy from Santa….maybe.

  • 355 Plornt // Aug 7, 2011 at 10:19 pm

    Lach keep up the good posts, always good to hear the other sides point of view. Its human nature to be wrong, so I have no problem admitting errors quickly.

    I’m not sure with my USD position atm. It kinda reminds me of the Euro situation in terms of how much bad news is comming out, usually happens at major reversals. I’m hedged on my USD position and up on it, so am not too phased by it, willing to let it play out and see if a big move will materialise.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 356 Lachlan // Aug 8, 2011 at 6:19 am

    sorry for the double post, I thought my original disappeared into cyberspace and then realised I was wrong.

    Thanks Plornt. It’s boring in echo chamber forums where everybody agrees. I’ll be wrong too but the opportunity to predict the markets future is just to much to resist apparently. I’ll just have to take the good with the bad. It’s all great fun in any event.
    Catch you end of week if your about. Cheers

  • 357 Greg Atkinson // Aug 8, 2011 at 11:15 am

    The All Ords/ASX 200 look like they might hold above 4000 today and might even have touched a bottom earlier today. This week should tell us if the worst of this correction is behind us or not.

    I am still expecting the Austrlaian stock market make a move up towards 4800 again…it seems to like it around there :)

  • 358 Plornt // Aug 8, 2011 at 1:28 pm

    Greg ya jynxing it!!

  • 359 Greg Atkinson // Aug 8, 2011 at 1:42 pm

    Plornt, yes, sorry. I am getting back in my box now. I don’t know why I even bother trying to make short term calls as I am obviously not good at it.

  • 360 Plornt // Aug 8, 2011 at 1:55 pm

    lol Greg.

    Looks like Gold is hitting new highs, yet again, whilst gold stocks remain in the doldrums. When this mispricing is corrected, one would think a viscous rise would ensue. Gold stocks may rocket, whilst Gold metal prices languish in a topping pattern.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 361 Plornt // Aug 8, 2011 at 3:21 pm

    “4056 on XAO means more than 20%, then we are officially in a bear market, meaning any rallies are counter-trend at best and unlikely to be more than 10%”

    Finished right @ 4056. Haha. 20% fall is in, cue the doom music.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 362 Greg Atkinson // Aug 8, 2011 at 3:34 pm

    Plornt my view of a bear market is a drop of around 20% over a period of 1-2 months so I would say a bear market is a possibility, but we are not there yet.

    This bear market definition seems reasonable to me: http://www.investopedia.com/terms/b/bearmarket.asp

  • 363 Plornt // Aug 8, 2011 at 3:40 pm

    Finished at the lows again! looks like this is going to go down again tommorrow. This coil is being pushed very hard to the downside. I wonder how many people are positioned short atm.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 364 Plornt // Aug 8, 2011 at 3:49 pm

    “Plornt my view of a bear market is a drop of around 20% over a period of 1-2 months so I would say a bear market is a possibility, but we are not there yet.”

    Yah I’m using the highs of April 11th 2011 intraday highs to workout the 20% fall. Thats more than 2 months – “over at least a two-month period, is considered an entry into a bear market.”. It fits the investopedia definition.

    I guess we can all have different interpretations.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 365 Plornt // Aug 8, 2011 at 3:52 pm

    Some people call bear markets after 10% falls, like in the flash crash last year. Or they call it after it goes below the 210dma.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 366 Greg Atkinson // Aug 8, 2011 at 3:56 pm

    Either way it’s close to a bear market. The only way the avoid one in my view is for stocks to rally out of this mess pretty soon.

    If we stay down here too long I guess I will need to revise down my 2011 outlook but I am a stubborn lad, so for now I am staying with 4800-5200 for the All Ords/ASX 200.

  • 367 Plornt // Aug 8, 2011 at 4:10 pm

    Greg yeah its slightly less than a bearmarket 20% fall, like misiscule. I was rounding up. I’m not as precise on these things as you.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 368 Greg Atkinson // Aug 8, 2011 at 4:33 pm

    No need to round up/down..I am not that technical :) I was thinking along the lines of a bear market not being a touch and go drop but rather a sustained slump. In any case if we stay stuck down here then it would be a bear market for me.

  • 369 Plornt // Aug 8, 2011 at 7:13 pm

    Going to wait till tommorrow before making a decision. Will buy some ASX bluechips possibly with very tight hedging.

    Need some direction from Wallstreet, we are in nomans land.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 370 Plornt // Aug 9, 2011 at 11:16 am

    Looks like this is near the bottom. Panic everywhere, blood everywhere. I’m unwinding my shorts and going long. Could be early, but we are so coiled to the downside this is just silly. Have very heavy hedging incase am wrong.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 371 Plornt // Aug 9, 2011 at 11:18 am

    The Bounce will be to about 4,200 or 4,300. Then new lows to 3,500. This is a bear market.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 372 Plornt // Aug 9, 2011 at 11:32 am

    Its about 3 or 4% from my bottom targets, in October. So this is just pure stupidity now. There will be a massive short covering rally.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 373 Ned S // Aug 9, 2011 at 4:21 pm

    I’ve been out most of the day – What the hell was that all about!?!

  • 374 Plornt // Aug 9, 2011 at 4:32 pm

    Ned it was the bottom of the XAO, you missed it :P

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 375 Ned S // Aug 9, 2011 at 5:04 pm

    Good thing – I suspect my heart’s too old for that sort of excitement! :D

    Though the Brits don’t seem to be impressed yet. And looking at the DJIA futures the Yanks are feeling less impressed than they were – If Uncle Ben isn’t ready to commit to QE3 tonight, I’d suggest he takes a sickie – For about 40 years – Under an assumed name in a far away country that is highly skilled at face transplants! :)

  • 376 Plornt // Aug 9, 2011 at 5:10 pm

    Well lets hope we get another drop, i need to cover my VIX position.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 377 Ned S // Aug 9, 2011 at 9:39 pm

    Amazing – The Brits are being forced to be happy/Well less unhappy maybe(?) – Though der Hun/DAX index still doesn’t love the prospect of QE3 apparently? – And is having a bit of a sulk (down 2%). While the Yanks have sort of perked up a bit given that it could actually be on?

    Cummon Uncle Ben – The whole world awaits the determinations of your prognostications! What absolute and total bullshit … :P

  • 378 Ned S // Aug 9, 2011 at 11:21 pm

    Tell me it’s just me by all means – As it probably is? (Simply wishful thinking maybe???) But is there any chance we are starting to see the beginning of other individual national markets moving indepenantly of the US markets?

  • 379 Plornt // Aug 9, 2011 at 11:32 pm

    “Tell me it’s just me by all means – As it probably is? (Simply wishful thinking maybe???) But is there any chance we are starting to see the beginning of other individual national markets moving indepenantly of the US markets?”

    Good point Ned, something to think about, could be happening. I’m not following the other markets atm, just DJIA and XAO and Nikkei for now, so am not really in a position to say much about it.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 380 Ned S // Aug 10, 2011 at 2:56 pm

    Think I’ll remain an observer:

    http://www.theaustralian.com.au/news/global-debt-crisis-could-last-20-years-warns-future-fund-chairman-david-murray/story-e6frg6n6-1226112193261

  • 381 Plornt // Aug 11, 2011 at 11:20 am

    I’m positioned flat atm, as i’m unsure which direction we are headed.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 382 Plornt // Aug 11, 2011 at 11:50 am

    Hope everyone is ok out there.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 383 Plornt // Aug 12, 2011 at 12:47 pm

    Well risk adverse is comming. I’m going completely short in a couple of weeks. Not going to touch a long with a barge pole by then – too dangerous.

    Big final crash is comming.

    Given the data i am seeing from my systems, I will be crazy to be going long then. If i’m long then, somebody shoot me quickly.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 384 Greg Atkinson // Aug 20, 2011 at 9:06 am

    Well another volatile week has ended with the Australian stock market holding once again on the way down. At present the ASX All Ords & S&P/ASX 200 are both struggling to stay above 4000 points and the chances of them finishing up near 5000 by the end of the year appears fairly remote.

    Perhaps the market is set to fall even lower and close the year somewhere below 4000?

  • 385 Ned S // Aug 20, 2011 at 2:31 pm

    “Perhaps the market is set to fall even lower and close the year somewhere below 4000?”

    Could be Greg – Anyone who says they know what is going on in the global economy, let alone something as reactive as the markets, is either crazy or a lot better informed and/or smarter than me.

    So there’s a lot of uncertainty about. And markets don’t like uncertainty ‘they’ say. Plus there’s no shortage of cash ready to trade the markets. And incentivised to do so given it can’t get returns doing much else.

    Thus the one thing that can be taken for a given is volatility apparently.

  • 386 Lachlan // Aug 21, 2011 at 6:07 am

    Ben gets his big chance to announce QE3 at Jackson Hole this week…fireworks guaranteed either way surely. Owebama needs a QE3 stock market rally about now I guess.

  • 387 Greg Atkinson // Aug 21, 2011 at 9:41 pm

    Ned the old saying is the “trend is your friend”…the problem is I can’t see much of a trend at the moment. What’s happening with the global economy? Ask me in a year and I will tell you what it was doing in August 2011 :)

    Lachlan, I think Ben is hooked on printing dollars, eventually it should work, maybe…maybe not. Personally I think not.

  • 388 Stillgotshoeson // Aug 22, 2011 at 6:21 pm

    Arrow have put out an offer of $1.48 a share on BOW. Bought my BOW at .92 One has to be happy with that. Through super too, so only going to cop 15% cgt.

  • 389 Ned S // Aug 22, 2011 at 7:52 pm

    Could be wrong Shoes, but my recollection is that the good news is you only pay 10% CGT on super as a usual thing – May well be the full 15% if you’ve owned the stocks for less than 12 months or somesuch though perhaps? But either way, it’s still a nice win.

  • 390 Stillgotshoeson // Aug 22, 2011 at 8:56 pm

    Yes Ned, 15% CGT is applicable as had them less than a year, back a few months on DRA I said that they had flagged a buy signal under a dollar. Have another two gas plays still in my portfolio, one has had swings of 20% lately, day traders dream… Have not been trading them though, they almost hit my target price recently though. EEG have done well for me too.

  • 391 Greg Atkinson // Sep 2, 2011 at 11:09 am

    I made the same observation months ago: Stockbroker forecasts 10pc equity rally on PM’s ouster. See: http://www.theaustralian.com.au/business/markets/stockbroker-forecasts-10pc-equity-rally-on-pms-ouster/story-e6frg916-1226127990490

    In other words, the political mess has trimmed 10% off the Australian stock market. (and it isn’t getting any better)

  • 392 Ned S // Sep 2, 2011 at 10:06 pm

    Prime Minister Gillard walked into the Commonwealth Bank of Australia to cash a cheque. As she approached the teller she said “Good morning, could you please cash this cheque for me?”

    Teller: “It would be my pleasure Miss. Could you please show me your ID?”

    PM Gillard: “Truthfully, I did not bring my ID with me. I didn’t think there was any need to? I am Julia Gillard, the Prime Minister of Australia?”

    Teller: “Yes Miss, but with all the regulations and rules etc these days, I really MUST insist on seeing ID to comply with bank policy.”

    PM Gillard: “But I have no ID with me I tell you! Surely there must be something we can do?”

    Teller: “Well Miss, there are some historical precedents? : ”

    “One day Greg Norman came into the bank without ID.
    To prove he was himself he unfolded his putting iron out of his left pocket, took his golf ball out of his right pocket, and proceeded to play the most delightful shot where the ball ran round all four corners of the room, bounced off a chair and ran right back up his leg to settled back in his right pocket where it originally came from – At which time time we knew he could only be who he said and cashed his cheque of course.”

    “Then there was the time Bob Hawke came in with no ID and on being qestioned, pulled a can of beer out of his right pocket, an AHA glass out of his left pocket, stood on his head, chugalugged the beer out his nose into the glass and generously offered us all a tiny sip before scoffing the remainder himself – So we obviously cashed his cheque too!”

    “So what exactly can you do to prove you are who you say Miss?”

    PM Gillard: “Well now that you’ve specifically raised it as an issue, in all truth, I’m not at all sure there’s any singular or particular thing I actually do especially well at all?”

    Teller: “Oh well played Madam Prime Minister! – Would you like your money in large or small denomition notes?”

  • 393 Senator13 // Sep 2, 2011 at 10:19 pm

    Hahaha!! Nice one Ned.

  • 394 Greg Atkinson // Sep 12, 2011 at 3:17 pm

    The ASX All Ords and ASX 200 both slumped by more than 3% today and are struggling to hold above 4000. It seems unlikely the market will rally above 5000 this year and I am starting to wonder if we will get much past that level in 2012 either.

  • 395 Ned S // Sep 12, 2011 at 3:32 pm

    Comment 383 above:

    “Plornt // Aug 12, 2011 at 12:47 pm

    Well risk adverse is comming. I’m going completely short in a couple of weeks. Not going to touch a long with a barge pole by then – too dangerous.

    Big final crash is comming.

    Given the data i am seeing from my systems, I will be crazy to be going long then. If i’m long then, somebody shoot me quickly.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.”

    If you followed your own advice, you deserve a celebratory drink tonight Plornt! :)

  • 396 Biker // Sep 12, 2011 at 11:02 pm

    Oh, you _gamblers!_

    Biker,
    LV

  • 397 Stillgotshoeson // Sep 14, 2011 at 5:53 pm

    Received a phone call from a large industry superfund that I am a member of asking if I would like to attend a meeting this coming Monday night to discuss ways of improving menber sevices. (I still have funds with them to take advantage of their life insurance option)

    Sent them an E-mail a month or so back in regards to upcoming changes they will be implementing and the would like me to attend a meeting to discuss this ideas. I told them would love to attend a meeting and discuss but Monday night is not an available time for me.

    Have sold out of a couple of my share positions.. 40% and 60% profits on them respectively.

    SBM Finally seem to making a move Lachlan. NCM are not doing much.

    Holding SBM, GRY, NCM, FML and my Bolivians for Gold miners.
    Holding EEG and BPT for energy plays.
    Retail, Uranium, Silver are also covered by a few more stocks.

    Will not touch the banks with a barge pole.. said last year that they would be on a hiding to nothing this year, they are all down (not as much as I expected) more was to come in October at the end of the guarantee, which has now been extended (albeit reduced) to February next year so maybe the have a few more months yet.. Europe will (and was always going to) dictate the fall…

    Still expecting further falls for the DOW and ASX. QEIII is coming and may give us another short rally but the end result is it is going to fall over.

    Sold out a couple that improve my cash position to take advantage of the fall.

  • 398 Plornt // Sep 16, 2011 at 3:00 am

    Hey Ned, wish I did — I’m still negative down.

  • 399 Plornt // Oct 28, 2011 at 1:31 pm

    Did everyone get on that last rally? I didn’t, great positioning from those who saw it in advance.

    We could go higher and I fully expect that to happen, system says another 20% fall starting in the next 10 days, with a ~20% fall, bringing us down to 3440 on the XAO. This is the capitulation fall and will take out all the permabulls, which sets up great longterm opportunities. Could be unequivocally wrong.

    Intuitively I think we are heading towards 2,900 on the XAO to completely reset and wipeout alot of people. Be very very careful, obviously to get down to these levels some sort of black swan event will have to occur.

    Goodluck and godbless.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 400 Lachlan // Oct 28, 2011 at 4:17 pm

    Hi Plornt
    I agree we need panic sell off to lower point Plort but my guess is at 3600 close fro xjo. I wont sell anything though only buy more….with shares being only a small part of my investment… but an exciting part. I’m hoping over time this sideways trend just compresses us on to a flat base around the 09 lows or a little higher before breaking higher when some special people announce a new currency system…either that or world war and hyperinflation.
    And on that cheery note…cheers :)

  • 401 Lachlan // Oct 28, 2011 at 4:21 pm

    I’m neutral and not predicting the lower move but i’d just feel better about a rally if we got one….the consolidation we’ve had here looks ripe for shaking out first.

  • 402 Plornt // Oct 28, 2011 at 4:46 pm

    They say most of the damage is done in the last 10% of the move. There was no major capitulation on the last low, just rangebound congestion.

    Lachlan just be careful or you’ll get eaten alive. Correct me if i’m wrong but you appear to have lost money in 2008, comeback in after being bearish when it was statistically poor to do so, then buy back in near the top, and now want to average down. If I were you i’d freeze all buyin — averaging down is a mugs game unless you have a material information edge; which us part-timers/casual mortals don’t. This is not advice though and you should always seek and take advice from a licenced financial advisor before making any decision.

    The problem we have now, is what happens to the XAO if the housing market goes. Will the XAO chart do an ireland? What % amount did that go down. It would be interesting to find out the % drop of each stockmarket in history after its related housing market fell substantially. And the housing guys are right when they say you are worse off in domestic equities than real estate if the housing market goes.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 403 Greg Atkinson // Oct 28, 2011 at 4:52 pm

    The market was oversold when it was down around 4000 but it’s was hardly worth the risk jumping in at that level just to ride the market up 10%.

    So here we are around 4400 again, it took longer than I thought but I blame the French for that ;)

    So for now the Europeans have stopped the bleeding whilst the U.S. economy limps along. But the finance news I am seeing here in Japan suggests a slowdown in China is indeed under-way and I put more weight on that than what BHP & RIO executives are saying.

    So we might get back near 4800 this year but that will be it. This will become more likely if the RBA cuts interest rates and the attraction of parking money in the bank becomes a little less.

  • 404 Lachlan // Oct 28, 2011 at 6:45 pm

    Sorry Plornt I just had three family members phone…I’m turning 40 on Sunday and I’m getting a party it seems :)

    I only buy gold shares at present. If we go lower I may look at divi payers in other areas. In the current market predicament the pog has risen much against shares in the last few years. Yes they are poor performers generally keeping with the broad market but better to accumulate here than later in a bull run. I also only buy at technical levels which look supportive. But it bothers me not because I only buy small, no leverage and hold for the long term. The market gyrations are a good chance to buy at better valuations so for example I like NCM at near $30 which is a pivot of sorts and if we get more downside I’ll buy there. If it goes lower I will not lose a wink…honestly. I have shares which are underwater eg GMR and BCN and shares which are doing very well against the recent market trend eg SAR and IGR. But to me they all represent a good long term bet. All of them.
    My outlook does not include too much deflation but in fact I am mainly concerned with real/relative values. The values of assets in relation to each other. It’s about how I think those valuations will change in the future. For example if people really see a complete deflationary collapse I am fine with that but how will relative values change in the event. And can people ride it out? No leverage…yes.
    Besides goldies I’d like to pick some coal and gas plays up but its not time right now I feel.
    I did lose money on shares and leveraged bets a few years back but have since done very nicely over my entire portfolio…largely metals. God willing, it’ll keep on keeping on.
    Cheers Plornt.

  • 405 Biker // Oct 28, 2011 at 10:08 pm

    Coal and gas are scary, Lachlan. Politics will interfere with these resources continually.

    Bumper sticker we saw last week: NO FRACKING COAL!

    Plornt, it’s interesting to speculate what might happen to the share market IF housing crashed. Remember that shares fell 55.4% _without_ any housing crash. Personally, we can’t see housing falling dramatically in our lifetime… but, if it did, we’d double our property holdings, quickly.

    There’s little drama in property…. no great rush like that in shares… or online poker… none of the glitter of gold… it just keeps paying fortnightly dividends, with a major _jackpot_ at tax return time. :D

  • 406 Lachlan // Oct 29, 2011 at 4:54 am

    Maybe you are right BP…I’m just astounded though at what’s going on. I’m around the gas and oil areas a few days a week at least and its just incredible the progress and money involved. Buy out the farmers, give the local sports club a free rider mower, everyone’s just dandy mate…
    Big mines, big money equals big political clout too.

  • 407 Lachlan // Oct 29, 2011 at 7:36 am

    correction… gas and coal areas, not oil

  • 408 Biker // Oct 29, 2011 at 11:35 am

    Lachlan: “Big mines, big money equals big political clout too.”

    That would normally be true, but with the current Green/Independent balance of power, political intervention is likely to limit fracking.

    We once believed that gas was the interim solution to energy needs. At the cost of polluted water supplies, we’re not so sure these days.

    We’ve spent the week buying up solar heat pumps and solar panel hot water systems. Just doing our bit for the environment… and, of course, consumerism!~ :D

  • 409 Ned S // Oct 29, 2011 at 11:10 pm

    Happy Birthday Lachlan! :)

    PS: Ignore Greg’s time – He works off one of those clocks that cause all our QLD milkers to dry up and run around in circles squirting out brine pretty obviously … :D

  • 410 Greg Atkinson // Oct 30, 2011 at 6:46 am

    The All Ords is now around 4400 and would be higher in my view if the mining & carbon taxes were off the table. The market rally after the European debt deal seems to have fizzled out so I am struggling to think what might give the market a push up from here. Probably not news from the U.S. Maybe a commodities inspired rally on the back of some good PPI numbers from China?

  • 411 Lachlan // Oct 31, 2011 at 1:52 pm

    Oooops, missed you Ned. Thanks for the HB…
    had a real nice day as it turned out. Played a lot of backyard sports, got a bit carried away, started to feel like a legend. Today I feel like I’ve been hit by a truck ;)

  • 412 Ned S // Nov 2, 2011 at 3:35 am

    It was all as it should have been then Lachlan :)

    Hmmm – How about those Greeks? Seems they’re hoping beggers just might be able to be choosy after all??? (I’d love to be able to listen in on Sarkozy and Merkel’s conversation – One would presumably get a crash course in all the very naughtiest of French and German swear words.)

    Seems to be the latest? :

    http://www.marketwatch.com/story/us-stocks-recover-some-on-greek-report-2011-11-01?siteid=bigcharts&dist=bigcharts

  • 413 asxiq // Nov 2, 2011 at 4:27 pm

    when ever S&P500 fallen by more than 2 % ASX AORD has the tendency to fall from open to close 14/18 times in 2011
    http://asxiq.com/blog/sp500-effect-on-australian-markets-aord/

  • 414 Ned S // Nov 3, 2011 at 8:34 pm

    Gillard and Swan want to bail out Europe. While China is inclining to the view Europe should bail itself out. And France reckons the EU actually can live without Greece. Might be a good idea for the Goose and the Red Queen to shut their yaps for a while and just see how the big boys ‘n girls decide to play it perhaps?

    Curious thought on China bailing out Europe – Why would China care too much? If Europeans should go from earning USD 40K pa (or whatever) to USD 20K pa (or whatever), wouldn’t that just mean they’d be even MORE inclined to buy cheap Chinese crud? As opposed to expensive US, German and Japanese crud? Unless things actually get so bad for the US, Germany and Japan that they actually can produce their expensive crud for not all that much more than China can produce its cheap crud??? (If you get my drift?)

  • 415 Ned S // Nov 4, 2011 at 1:46 am

    Looks like the markets are taking a pragmatic attitude to it? Greece is screwed – Oh well, we always knew that was the case anyway …

    Curious – Wonder if the news that Italy is screwed will meet the same response? How about the facts the UK and the US and France are screwed?

  • 416 Ned S // Nov 4, 2011 at 3:39 am

    Taint easy being a bear Biker … :D

  • 417 asxiq // Nov 4, 2011 at 8:19 pm

    backtest performance summary for AORD after an “inside day”

    http://asxiq.com/blog/inside-day-trading-strategy-on-asx-index/

  • 418 Biker // Nov 5, 2011 at 8:47 am

    Ned: “Taint easy being a bear Biker … :D

    Finding retirement out in the paddock suits me, Ned*.
    Record tax return this year, a/c to our accountant, yesterday.

    More answers to our list of key questions, but we’ll only really know if our tweaks work, in 2012. Bank interest will be well down, we think. Mine dew, rents continue to climb steadily. :)

    * I could stay here for heifer and heifer and heifer…

  • 419 Plornt // Nov 5, 2011 at 11:18 am

    Thanks for the post asxiq, but i think perhaps it would be better to not post links to your site every post. I’m not sure alot of your trading setups that you’ve statistically analysed would work effectively in the real world.

    Maybe you should show your returns and trades you’ve entered, in real time, so we can better gauge the quality of the information being provided.

    Cheers and hope your site does well.

  • 420 asxiq // Nov 5, 2011 at 11:53 pm

    sorry mate plorant , will try to post the content (along with the setup if at useful )with out a link to the site next time on wards.

    cheers and good luck in your trading .

  • 421 Plornt // Nov 22, 2011 at 1:03 pm

    Numerous stocks have bottomed imo LT. Bearishness is rampant. Next year will have very good returns (and probably years after that) once we get through this mess. Am buying LT investments heavily into this pullback and will average down. Throw a dart at a beaten down stock time.

    Massive Nikkei Bull cycle is starting.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 422 Greg Atkinson // Nov 22, 2011 at 6:00 pm

    I am not inclined to buy much at the moment. We now have the World Bank talking of a slowdown in China and so it seems the idea that the Chinese economy will slow has finally caught on…about 18 months or so since I raised the subject on this site :)

    The big downside risk to the Australian stock market is that the economic soft landing in China will turn out to be a rather painful crash landing.

    As for the Austrlaian stock market, well it seems we are moving now sideways between 4000-4400 and I fear we might be stuck in that range for a while.

  • 423 Stillgotshoeson // Nov 22, 2011 at 8:14 pm

    Many stocks have bottomed, many more have yet to stop falling.
    I still think we will test a new low.

    Our banks are out of steam and the troubles in the Northern Hemisphere show no signs of improving, China is slowing down so our resource companies are going to cop it as well.

    Took advantage of the SPP for RIO recently buying $9k worth to add to my current holdings of them. Max allowed was $15k

    Some on my watch list are at attractive levels but not jumping at anything at the moment.

    Can not see any reason to buy the banks or RIO and BHP at the moment. Interesting times still ahead.
    BAnks still have short term funding issues going into 2012 and poor growth since their end of financial year results.
    Have added a couple of stocks to my watch list that are at levels that interest me, will watch them a little longer. Holding a dozen companies across my super and non super holdings.
    May go big on one of my gold miners soon.

  • 424 Plornt // Nov 25, 2011 at 12:46 pm

    System XAO giving short exit signal. Hdg Targets hit.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 425 Greg Atkinson // Nov 25, 2011 at 1:03 pm

    The Australian stock market is getting knocked around by the European debt mess but also because many investors have woken up (finally) to the reality that China is not immune to a global slowdown and either is Australia.

    But having said that I sense we are in oversold territory again. The problem is the that upside from here is likely to be pretty limited in the short to medium term.

  • 426 Lachlan // Nov 25, 2011 at 1:34 pm

    “But having said that I sense we are in oversold territory again. The problem is the that upside from here is likely to be pretty limited in the short to medium term.”

    I see that too Greg. The ASX200 has a pivot around 4000 which it might close at today and bounce from next week. The bears will need to get us down to 3800 in quick time to have much of a case for further downside medium term. Regardless there are no great gaps to fill on the up or downside so unless we go to war next week or the sun fails to rise then I guess its just going to be more chopping about until we grind our way out this range one direction or the other. Crumbs, I’m starting to wish the bears are right and we can just collapse and finally start a decent rally from lower down.

  • 427 Plornt // Nov 25, 2011 at 2:56 pm

    “But having said that I sense we are in oversold territory again. The problem is the that upside from here is likely to be pretty limited in the short to medium term.”

    Yep not much downside from here. Im not betting against my system to get out of shorts, thats for sure. Might keep going down, but there is alot of great longterm value out there, the question is can you handle the volatility to capture the longterm gains, or will you sit there in fear hoping for a better price, even though great value is staring you in the face.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 428 Stillgotshoeson // Nov 25, 2011 at 3:15 pm

    Plornt // Nov 25, 2011 at 2:56 pm

    ” the question is can you handle the volatility to capture the longterm gains, or will you sit there in fear hoping for a better price, even though great value is staring you in the face.”

    My problem is there are far too many stocks now at very attractive levels for the longer term. I do not want to hold a 50 stock portfolio, even 20 is starting to get too high for my liking.

    As I mentioned on a previous thread, between the US and Europe I am expecting multi trillion dollar QE.

    Volatility I think I can handle, early forties, plenty of time to recover from a bad choice(s). Couple more years of “wealth” building then I intend to switch to a more income defined investment portfolio and stop working, or if need be down to a couple of days a week.

    Volatility is with us for a while but the trend is still indicating down.

  • 429 Greg Atkinson // Nov 25, 2011 at 3:42 pm

    The scary thing is we are mainly dealing with a market dragged down by Europe but can you imagine the hit the Oz market would take if the Chinese economy hits the skids?

    That’s the downside I worry about.

    Looks like my end of year target of around 4800 is toast..maybe I should have said 3800!

  • 430 Plornt // Nov 25, 2011 at 6:06 pm

    Greg my EOY target is 4600. I remain optimistc we will get there. Since we’ve already crashed, im going to try and be greedy whilst others are fearful. I think a big move to the upside is comming in the ensuing months and years. I’m pretty sure about this, and i’ve gone all in so to speak.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 431 Plornt // Nov 25, 2011 at 6:09 pm

    Adapt or die ;)

    I think alot of ppl have burnt fingers from the second crash in the 2008 GFC Debacle, where there was a second crash in Sept/Oct after the first one in January 08. This is not going to follow the same path.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 432 Biker // Nov 25, 2011 at 7:23 pm

    Plornt: “This is not going to follow the same path.”

    As Don once noted: “History repeats itself until it doesn’t…”

    Are we likely to see this deja vu all over again? ;)

    http://www.watoday.com.au/business/bank-tips-four-rate-cuts-in-a-row-20111123-1ntnt.html

  • 433 Plornt // Nov 25, 2011 at 8:11 pm

    Yes both our opinions are useless. The difference being im using systems to help some of my ideas and you are quoting media articles.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 434 Greg Atkinson // Nov 25, 2011 at 8:17 pm

    Biker didn’t you already say that earlier? ;)

    Anyway I said back at the start of the year and maybe even back late last year that interest rates were too high and should come down. But many wise minds in the finance media said that rates in 2011 would rise without a doubt, so I guess I was wrong ;)

    I have been bearish regarding the Australian stock market for some time however at this point in time it seems I might not have been bearish enough.

    We might see major push up towards 4600-4800 for the All Ords/ASX 200 but I doubt it. At the moment if we were to end the year around 4400 then that would be good enough for me.

  • 435 Plornt // Nov 25, 2011 at 8:30 pm

    Its doesn’t matter if you are right or wrong Greg, as long as you don’t stay wrong. I still think rates are going to rise, my system tells me that a continuing correction is possible but Australian Government bonds are definitely in a bull market.

    Catalyst for bond rates could be Australian house prices collapse over the next 5 years, banks fail, Cth bails em out, government in huge amount of debt and we become Ireland.
    Australian Banks seem to be cutting costs heavily, which should help profitability, whilst house prices are comming off slowly, analogous to America (history repeating in different market(s)).

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 436 Biker // Nov 25, 2011 at 11:02 pm

    Greg: “Biker didn’t you already say that earlier? ;)

    Like I say, deja vu all over again, Greg! I must be getting older, alzheiming, perhaps(?) although I note that some of us are actually getting _younger_! More recovery time needed, mebbe?

    I too thought the market would be higher by year’s end. Foolish of me to try to predict the future. Gotta avoid these epidemics!

    Looks pretty good to us here. About to start building again.

  • 437 Biker // Nov 25, 2011 at 11:08 pm

    Plornt: “I still think rates are going to rise…”

    Are you serious? What ‘system’ is providing this information?
    Does it provide a timeline for these rate increases?
    When might we expect the first?

  • 438 Plornt // Nov 25, 2011 at 11:24 pm

    “Are you serious? What ‘system’ is providing this information?
    Does it provide a timeline for these rate increases?
    When might we expect the first?”

    Biker I would provide more details but I really cant be bothered because there is no benefit in me helping you. Nor do I really care what you think.
    Good luck with your endeavours and I wish you the most success.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 439 Biker // Nov 26, 2011 at 7:27 am

    Plornt: “I really cant be bothered because there is no benefit in me helping you.”

    Never mind… . Perhaps your insights into rates will help others wise enough to heed your counsel.

  • 440 Greg Atkinson // Nov 26, 2011 at 8:07 am

    Anyone brave enough to make a call on where the All Ords/ASX 200 will end this year? I am sticking with the call I made my: Australian stock market outlook for 2011

    I am fully aware that I will probably have egg on my face in around a months time but to change my forecast now would be a bit lame.

    If you make a forecast where the stock market will end the year please make it interesting and include the reasoning behind your call.

  • 441 Plornt // Nov 26, 2011 at 8:52 am

    Biker if you are good as an investor as you are sarcastic, you must be very well off. I wish I had your millions, but i’m just a poor soul who has very little. Its amazing someone who has been through so much and is supposedly implicitly wise, is still “afriad” of the stock market and is using the most interesting and breakthrough methods in order to make money from it.

    I wonder if there is any sound method to your real estate endeavours or if it was just pure luck based on holding forever, for which a real estate generational crash will wipe out those gains and bring you back to the pack, and your intellectual superiority complex with it.
    Keep arguing with me Biker, i’m happy to continue debating and keep positing and asking reasonable questions about your real estate endeavours.

    What system(s) do use? Have you tested them through a 20-30% crash, or are you just using the 90′s “plateau” and your decades of experience through a housing bull market to help you now. I know there are lots of market(s), but id love you to be able to pick a market with these system(s) of yours, admist massive turmoil and still turn a profit. The GFC example was not a proper crash, not by any stretch. I think that purchase you got lucky; if the housing market(s) properly crashed, like they are in a rolling fashion now, you would have been underwater on that purchase from cost.

    I judge people not on how much they have, but on how well they do under extreme stress. I have yet to see you survive a housing crash of the magnitude of 20-30% across the board median house prices in each state. When I see you do that, I will gain respect for you. For now I just see an old man who got lucky holding for 30 years gloat just before he possibly gets a massive reality check (and I really hope you avoid this and do well).

    Lots of people used 20-30 year bull markets in shares, kept using the same methods / systems/ plans through the GFC and got absolutely slaughtered, losing 50-60% of their capital. The same things happened for real estate investors in America who relied on their “knowledge” in the 80s,90s,00s — albeit they on balance did not lose as much as their equity counterparts.

    Greg I can only spit out my system targets, if I divulge the reasoning, the system components will be given out, which I am not prepared to do, nor am I stupid enough to. I don’t base my decisions based on trying to predict where the economy is going, or trying to guess human actions which are inherently complex to understand.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 442 Plornt // Nov 26, 2011 at 9:14 am

    Just a small side issue: we’d have to arguably question whether Biker is actually correct in alot of what he has stated, re: real estate investing or is he a psuedo username. I’m not saying that Biker is one, I believe what he has said as he seems like an honest individual, and have based that assumption in my post directly above. But there are lots of super wealthy individuals (>100+ million) that go under false identities and target newbies in order to make themselves feel intellectually superior without repercussion.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 443 Biker // Nov 26, 2011 at 9:55 am

    Some quick responses:

    * We don’t claim to be wealthy. Others claim we are, but it’s all relative.

    * When I get it wrong, I’m happy to say so. Reread Post 436.

    * We don’t believe in ‘luck’.

    * Yes, I’m using a ‘false identity’. My name is not really ‘Biker’.

    * Your disclaimer is a wise inclusion.

  • 444 Plornt // Nov 26, 2011 at 10:32 am

    Great substance there Biker re: your system(s). As much detail as I gave you lol. You shouldn’t criticise others if you are unwilling to divulge your own “systems”. I suspect if I keep pushing the envelope the responses will become more sarcastic and cryptic.
    May I suggest you give a disclaimer saying that everything you say is fictional at best, just kidding.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 445 Biker // Nov 26, 2011 at 1:34 pm

    System? We don’t really have a ‘system’, Plornt.
    We keep it simple:

    * Buy low;

    * Sell high;

    * Hold through flat periods;

    * Do the simple(r) building stuff yourself;

    * Plough back _most_ of the gains into property / Super;

    * Raise rents _after_ good tenants leave;

    * Don’t renew leases of disrespectful tenants.

    * Don’t gamble.

    Disclaimer: The above ‘system’ is pretty dull and boring. Works well but has few of the thrills of online gambling.
    Very little ‘thinking’ involved. Few shortcuts.
    Involves some physical labour… .

  • 446 Greg Atkinson // Nov 26, 2011 at 2:14 pm

    …and back to the stock market please…

  • 447 Biker // Nov 26, 2011 at 2:26 pm

    He asked… I responded. ;)

  • 448 Plornt // Nov 26, 2011 at 2:45 pm

    lol poor Greg caught in the middle mediating again.

  • 449 Stillgotshoeson // Nov 26, 2011 at 3:38 pm

    Greg Atkinson
    Anyone brave enough to make a call on where the All Ords/ASX 200 will end this year? I am sticking with the call I made my: Australian stock market outlook for 2011

    I am fully aware that I will probably have egg on my face in around a months time but to change my forecast now would be a bit lame.

    If you make a forecast where the stock market will end the year please make it interesting and include the reasoning behind your call.

    One of my favourite Quotes.. Benjamin Graham: “You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.”

    My data tells me that this is not over and the trending down of the DOW and ASX is to continue, volatility will continue and we will see little rises here and there but the bottom, has yet to be reached.
    Reasoning says manipulation is going to occur to interact with this downturn.. With a month or so to go until the end of year we reallistically will only get an announcement of governments intention to intervene in the economies, by default the markets, and this will give us the oft talked about “xmas” rally. Resistance is very strong at 4400 so that is the peak I expect the asx to reach on any announcement.
    Procrastination and no announcements into the new year will most likely see the decline this year continue to 3750.

    Greg Atkinson // Nov 25, 2011 at 3:42 pm

    The scary thing is we are mainly dealing with a market dragged down by Europe but can you imagine the hit the Oz market would take if the Chinese economy hits the skids?

    Not my figures but one Heraldsun columnist has given the figure of 1100 for the ASX if indeed China does have a harder landing than we all think it will…

    Have decided to buy around $60000 worth of an Aussie Gold Miner I like on Monday, along with $40000 ($20k each) on a couple of beaten down stocks that I feel reasonably confident on. One of them is still paying around 10% dividends and is trading at a discount of around 90% from the high.

    The other is yet to resume paying dividends but has recently announced a government contract and they have managed to get the debt problems for the most part covered, may look to share holders in a capital raising next year if the need arises. They are down to levels they were paying as dividends pre GFC. They have consolidated the share base too, some risk in the short term so only willing to risk a small stake on them, longer term, who knows, they could well be giving me back the purchase price every year in dividends.

  • 450 Ned S // Nov 26, 2011 at 7:01 pm

    It’s starting to look ugly again.

    Oil is still high though – I guess that could sort of be seen as a positive maybe?

    Anyway, China is going to do a lot of stimulating. Some of which will presumably help Oz. Though not as much as last time.

    Commonsense (to me???) says protracted multi-year downturn. Though I gather our official growth guesstimate is still about 4% – Which IS extremely healthy.

    ASX 1,100? – Ferk, any of my mates who’ve geared their retirement towards super and don’t actually top themselves WILL be looking at working until they are 80! ;)

    Anyway, all that aside, I’d love to know what Merkel is REALLY angling for. Superficially it would seem to make sense to want to keep the Mediteranneans in the EU. But surely she has to realise she’ll never really change them? They’ll never really carry their weight??? Strange – I’m confused. (But that’s normal for me.)

  • 451 Ned S // Nov 26, 2011 at 10:37 pm

    ASX prediction for end of calendar year – Somewhere between 3,400 and 4,400. :D (Stocks are volatile – So who could actually pretend to know?)

    Wave a moist pinky in the air and make it 3,650 maybe? (ie to the low side) – On the assumption Merkel will still be doing what she currently is to get the result she wants – Not that I know what it is?

  • 452 Senator13 // Nov 27, 2011 at 8:43 am

    My rough prediction is that by the end of the year the ASX will still be starting with a three. Who knows where exactly… It has been so volatile. But with the Europe mess I do not see it improving anytime soon…

    Over the next 6 months I see it still trading in a pretty narrow sideways range like we have seen for the last year or so. Maybe in the vicinity of 3800-4200?

  • 453 Biker // Nov 27, 2011 at 1:06 pm

    Ned: “…who could actually pretend to know?”

    * * * * *

  • 454 Plornt // Nov 27, 2011 at 2:20 pm

    I notice almost everyone has a downside bias atm on here. Thank christ i’m long :P

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 455 Stillgotshoeson // Nov 27, 2011 at 2:42 pm

    Biker // Nov 27, 2011 at 1:06 pm

    Ned: “…who could actually pretend to know?”

    * * * * *

    Well you yourself have admitted that the guys over at DRA saved you a motza when you made changes to your investments on their warnings.

    It is not about knowing, it is about how you act/react to all the data available to you.

    You have also agreed that people should take more interest and action on how they invest, be it in a superfund or outside a super fund.
    People that have merely invested in the index funds have not done as well as some one whom may have taken a more proactive role on handling their investments.

    Bias plays a big part as well..
    The saying “past performance is no guarantee of future performance” rings true in all investments.
    If the things you say are true about your property investments, then yes at a prime period of time for property you have been able to take advantage and do well, others of a similiar vintage may have had the very same opportunities and for whatever reason, did not take advantage of those boom times. Just because what has worked well for you for the last 30 years is no guarantee that they will work for others to the same extent over the next 30 years.

    How low the ASX falls to, and how high Gold/Silver rise are mute points to my investment strategy. my strategy is to adjust my investments to suit the information available to me, the risk I am prepared to take and the preservation of capital as well as wealth creation.

  • 456 Stillgotshoeson // Nov 27, 2011 at 2:44 pm

    Plornt // Nov 27, 2011 at 2:20 pm

    I notice almost everyone has a downside bias atm on here. Thank christ i’m long :P

    Contrarian positions usually do well :)

  • 457 Greg Atkinson // Nov 27, 2011 at 4:14 pm

    Ned I think your call looks pretty good :) I sometimes wonder why I even bother trying to guess where the market will go but it does make me think seriously about the outlook for the year ahead so maybe it serves some purpose….then again maybe it’s waste of time.

  • 458 Lachlan // Nov 27, 2011 at 7:03 pm

    I don’t really see any high probability targets for year end and the global situation is very volatile giving plenty scope for outside/unexpected shocks to push the market up or down.

    Having said that I think 3600 would be the lowest point we’re likely to achieve for a closing between here and then with upside contained below 4600.

    I am waiting this week to see if the DXY makes a big dash higher leaving the AUD/USD in bearish territory retesting 94 inviting targets in the 80′s. Its not a sure thing to translate that to ASX downside since cheaper local $ may limit downside (as higher AUDs seemed to restrict upside before) and given the chart compression anyhow. But I would be more bearish on the Dow which has quite some downside technical potential.

    Greg I think blokes love to joust with each other over their market predictions, its fun… and always interesting to see how peoples perspectives change over time.

    Looking forward to an interesting week I think. Europe is surely about to do something soon to resolve funding issues. Not sure what it may be ;)

  • 459 Ned S // Dec 1, 2011 at 8:22 am

    I notice almost everyone has a downside bias atm on here. Thank christ i’m long

    Contrarian positions usually do well

    :D :D :D

  • 460 Greg Atkinson // Dec 1, 2011 at 9:24 am

    Lachlan I don’t have my jost at hand right now meaning I have not been that active in terms of adjusting my positions for a while. I trimmed off some profits when they were available, but have not been in buying mode for all of 2011.

    Hopefully next year we will see the markets quieten down and governments deal with problems rather than trying to paper over them. But that might be wishing for too much.

  • 461 Biker // Dec 1, 2011 at 9:38 am

    Lachlan: “Not sure what it may be ;)

    *****

    But you called it, Lachlan. Five stars. :D

  • 462 Lachlan // Dec 1, 2011 at 8:04 pm

    I’m just waiting to see if I can give a 1000 point wide prediction and get it wrong now BP ;)

    I’m still neutral really but the market is on it’s way to 4400 here again after the reversal off 4000 I guess. Despite all the loosing so far this week though I am neutral still thinking we could have a violent smash down in metals and markets. If so it wont be far off now. 4400 or 4600 are good places to start a collapse. Not worried but…..I love it :)

  • 463 Lachlan // Dec 2, 2011 at 5:58 am

    I think we will have a more centralised finance system before the government insanity moderates Greg….and trade imbalances begin to reverse. Won’t be good for people who think generous government handouts last forever. Just a gut feeling anyhow.

  • 464 Greg Atkinson // Dec 8, 2011 at 3:22 pm

    If the Chinese property market continues to slide backwards then 2012 might be a little more tough than I expect.

    In any case I think it’s wise for stock market investors to keep an eye on what the Chinese property market is doing. Also probably wise to pay a bit more attention to India.

  • 465 Plornt // Dec 15, 2011 at 2:58 pm

    System targets on GC (gold) reversal are 1440, potentially down to 1220. Multi-month reversal likely for GC or until targets hit, possibly following the path that silver took (silver leading indicator). Although this correlation, strong or otherwise, wasn’t used for potential system targets.
    Can’t see any systems for a reversal on the XAO, so remain bullish XAO.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 466 Plornt // Dec 16, 2011 at 11:13 am

    Just to clarify above post:

    Should have posted this GC setup earlier, but I missed this GC short setup as I wasn’t interested in gold at the time and doing something else; only caught my attention after it fell. But it triggered on 11th Nov, so thought to post it on here so as to help others. System doesn’t have anything to do with the moving average lines or support/resistance lines (i.e. 20/48) which I personally think are pretty useless, after my own experience with them. Have stopped using technical analysis and charts, as overall they are pretty useless for me (i’m sure they work for others) and my systems do not require charts.

    Can’t find any systems for long USD, but am trying to find something, as that would give more credibility to the accuracy of the gold system targets, as there is obviously a negative correlation between the two.

    This is a difficult market for taking positions in still, but I remain optimistic long term equities, albiet the ride may not be so smooth. Volatility is your friend if you can stomach it, which most people can’t.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 467 Plornt // Dec 19, 2011 at 7:09 am

    System is firing long XAO Targets 5,700. DD max 250 points.
    At least there is statistical backing for a big bull move here now. It could be wrong, but I will back my system again. I have no idea why so many people are bearish right now. When the market breaks out of this range; there will be a lot of cash comming in off the sidelines.
    DJIA I can see what systems others are using, but they are not high probability setups imo, and could go either way.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 468 Stillgotshoeson // Dec 19, 2011 at 8:16 am

    USA have okay’d a trillion dollar spend for the next 12 months, Europe is most likely to get an injection of funny money so a 5700 is not out of the realms of the possible at all Plornt.

    I still think the ultimate trend line will continue, that is downwards… volatility is the name of the game and “relief” rallies on any thing resembling good news… panic sells on anything not good…

    We COULD have 5 more years of this…

  • 469 Plornt // Dec 19, 2011 at 8:34 am

    I don’t really use trend lines Still, but I can see what you are referring to. The problem with trend lines is you can basically place them anywhere to suit your bullish or bearish bias. For instance if I place a trend line on the XAO intraday lows from 1984 to 2011 I could say that the 3800 intraday low XAO correction hit long term support, and is now bullish.

    That money hitting the system should do the trick ;)
    Its always darkest before the dawn, and I doubt its going to turn pitch black on me. Rational confidence and optimism will win.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 470 Plornt // Dec 19, 2011 at 8:48 am

    Also long dated SPI futures are experiencing Normal Backwardation 9 months out; this is very odd as it should be in contango. I’ve noticed a lot of pricing errors in options given all the volatility that has been occuring. It seems a lot of trading firms are over pricing downside risk. This is not going to be pretty if they are on the wrong side, and the market turns heavily as my system outputs have inferred.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 471 Greg Atkinson // Dec 19, 2011 at 9:30 am

    BHP is trading today at just over $34 and that says a lot to me about how the market is pricing in the outlook for the next 6 months or so.

    It doesn’t look like too many people believe that commodities prices are going to head back up to record high levels again anytime soon and the outlook for most G-& economies for 2012 is pretty grim.

    I haven’t given up on a Santa/end of year rally yet although it’s not looking very likely at the moment.

  • 472 Plornt // Dec 19, 2011 at 9:31 am

    Geezus talk about panic. Its almost like people are selling first; worrying about why later. There is too much focus on capital preservation; if you wanted to focus on capital preservation you should have been doing that at the top of the market; not now.
    Retail sector is looking very interesting; blood everywhere, and lots talking about further falls.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 473 Plornt // Dec 19, 2011 at 9:35 am

    This is starting to remind me of May 2009. Just feels the same.

    I have no opinions on BHP Greg. Have not run my systems through it.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 474 Biker // Dec 19, 2011 at 9:42 am

    Shoes: “We COULD have 5 more years of this… ”

    Jeez, you’ll be an old bloke before you get that sports car, son!

  • 475 Plornt // Dec 19, 2011 at 9:44 am

    Well I think we are at the XAO bottom or close to it. Next rally is going to heavily breach the 200dma imo, and based off purely TA the DJIA is headed for a double top around 12,800, but I hate basing decisions purely off TA, so this is just a guess at best.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 476 Plornt // Dec 19, 2011 at 9:47 am

    I think people are misinterpreting the down slopping 200dma as a bearish down trend instead of a coiled break out (purely based on TA which I don’t use to base my decisions off as its too hit and miss). They are trying to correlate it with the 2008 crash, can see what the masses are thinking; thank god I am on the other side of that!

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 477 Ned S // Dec 19, 2011 at 1:06 pm

    Bank of Canada reckon it’s either a slow muddle through or a bust:

    “On one track, Europe’s debt problems explode, spraying shrapnel across the global financial landscape. Global credit freezes up, economies slow, commodity prices plunge as they did in 2009, and the world takes trade-invested Canada into a second recession, maybe as deep as what occurred three years ago.

    On the other track, European policy-makers are able to stop the hemorrhaging and prevent contagion. Markets rejoice, confidence is restored, cash-rich corporations invest again, commodity prices strengthen, Canadian exports rebound and the economy continues its current modest expansion.

    Pick one or the other, economist say, there is almost nothing in between.

    “It’s not quite a binary outcome, but it’s pretty extreme alternative scenarios,” Craig Wright, the Royal Bank’s chief economist, says of the quandary facing forecasters.”

    and

    “As Bank of Canada governor Mark Carney stressed this month, the world is trying to emerge from a “debt super cycle” that has taken overall debt — government, households and non-financial corporations — across the big G7 economies to about 300 per cent of gross domestic product. Such flagrant irresponsibility will take years to overcome.”

    plus

    “TD Bank chief economist Craig Alexander says the most likely scenario remains that European policy-makers will be smart enough to avoid the worst, since they will be first over the edge.”

    and

    “Alexander says those who expect a more robust or steady rebound — as many did last year — are probably fooling themselves.”

    http://thechronicleherald.ca/business/44000-economic-forecast-yet-more-uncertainty

    G’day Don! :)

  • 478 Plornt // Dec 19, 2011 at 2:11 pm

    “Pick one or the other, economist say, there is almost nothing in between.”

    Thats true. Its possible for the DJIA to just go sideways; which means value stocks should outperform if purchased at sensible prices.

    If you search through the SPX quite a few value based equities bottomed in August and have been respecting those lows since. Many high quality large-cap DJIA stocks are trading at historically low price to earnings ratios. For instance Microsoft is trading on a 2012 pe of about 9, even though in the last 17 years its had eps growth every year, but one, and clearly has an ability to raise prices on many on its products without seriously affecting demand. There are many other high quality large-caps trading at odd multiples.

    If someone can show me a system that will identify a high probability setup that indicates there is a strong likelihood of further falls I will be open to listening. I’ve not been able to find one that is better than a toss of a coin, or in the case of technical analysis pattern recognition (e.g. Elliot Wave), doesn’t contain any inevitable subjectivity and bias.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 479 Plornt // Dec 19, 2011 at 5:53 pm

    BBG (Billabong) is firing long. I have entered this; 3% of portfolio. Max drawdown is not small though, 30% from the current closing price, but it is a temporary drawdown if long term investing (and provided the directors are not asinine). Probably get another wash out. I will double position if it goes to $1.15 (i very much doubt it will get there).

    Billabong will need to offload non-core brands to cut debt, but the core Billabong brands are very strong and profitable. Seems they just took on lots of poor acquisitions and let their debt levels get them into a bind. But this is hardly a debt laden company that can’t produce a lot of free cash flow under normalised retail conditions. Everything reverts back to the mean eventually; overshooting and undershooting on the way.

    The founder of the company owns a significant stake still, so I am more at ease with a person on the board who has significant interests in the company since inception.

    Retail sector will benefit from a lot of pent up demand from people postponing their christmas shopping; which may flow into the January sales period. I’ve looked a what a few aussies are doing with their money on various sites and consensus appears to be there are a lot of people who are excessively saving out of fear of what might occur. Additionally I ordered some equipment the other day and found the wholesaler was running abnormally low inventory levels, so there was a delay. Not enough of a sample size to make a definitive and rational conclusion obviously.
    In any event it appears when confidence starts to comeback there may be a flood of money moving from under people’s mattresses and start spending again; around and around we go and the retail cycle starts all over again. Certainly the stock market are now pricing in a lot of the worst case scenarios for retailers.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 480 Plornt // Dec 20, 2011 at 11:15 am

    Unloaded my BBG position for a small loss (0.6% of portfolio) as i’m not comfortable with the uncertainty, even though my system is saying there is a high probability rise. Added to my long dated SPI futures long.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 481 Plornt // Dec 20, 2011 at 6:29 pm

    May 21 2011: Post 211
    “At the sametime, statistically theres a very high probability that DJIA is 11,000 or below by EOY. This is a very confusing setup, which is only making me more cautious and confused longterm.

    Most of the charts in the XAO look terrible, lots in downtrends. So even if I wanted to invest longterm theres not many buy signals. Probably wise to avoid small caps, given the risks.

    The LT buy signals may only come post August-Oct correction, or we could correct heavily in June, who knows. One would assume the quality growing large caps will more likely go up in late stage bull markets and into the foreseeable future. Probably the best course is to wait for the DJIA to implode during Aug-Sept and then take longterm positions in the XAO, or slowly accumulate with the knowledge that it could fall further, short term.”

    Well most of these things have played out; so I will continue to stick with my plan and buy value whilst everyone is racing to protect capital at the bottom of a market.

    There is a high probability for 20-30% returns for the XAO next year using the same system that gave a high probability for the sub 11,000 for the DJIA; which occured. So when this “bear market” turns you better be fast.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 482 Plornt // Dec 20, 2011 at 7:05 pm

    There is obviously the possibility for further falls for which I am hedged, but I am looking to unwind all of my puts and shorts into the next widely anticipated fall (short NCM and HPQ), but I have a strange feeling it might not be as deep as what a lot of people are expecting.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 483 Plornt // Dec 20, 2011 at 11:32 pm

    “Starts increased 9.3 percent to a 685,000 annual rate, exceeding the highest estimate of economists surveyed by Bloomberg News and the highest level since April 2010, Commerce Department figures showed today in Washington. Building permits, a proxy for future construction, also climbed to a more than one- year high.”

    Housing recovery in America underway?

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 484 Plornt // Dec 21, 2011 at 2:13 am

    Dec 19:
    “System is firing long XAO Targets 5,700. DD max 250 points.
    At least there is statistical backing for a big bull move here now. It could be wrong, but I will back my system again. I have no idea why so many people are bearish right now. When the market breaks out of this range; there will be a lot of cash comming in off the sidelines.”

    System is right again; surprise surprise! TA doesn’t work consistently. Elliot wave is hopeless imo.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 485 Stillgotshoeson // Dec 21, 2011 at 8:06 am

    Plornt // Dec 21, 2011 at 2:13 am

    Dec 19:
    I have no idea why so many people are bearish right now.

    http://www.businessspectator.com.au/bs.nsf/Article/US-economy-markets-Wall-Street-interest-rates-Fede-pd20111221-PQT3U?OpenDocument&src=sph&src=rot

    There is simply too much debt, both Government and Personal. More than can be repaid.
    More buckets of money may buy us more short term relief, but the longer this persists, the worse it is going to be when it falls over.

  • 486 Plornt // Dec 21, 2011 at 8:47 am

    Yes I am aware of the US debt issues; you would need to be living on a deserted island to not have some knowledge of the situation. There will likely be a US government bond implosion arising from such issues some time in the foreseeable future; leading to higher bond yields:

    “Yet, as Allister Heath writes in The Spectator this week, “UK and American governments can be loaned money – and, in effect, be paid for the privilege. This is crazy. It shows that the bond markets are well and truly in major bubble territory, their valuations as absurd as the rocketing subprime properties of yore.””

    http://www.moneyweek.com/investments/bonds/government-bond-bubble-13901

    Obviously buying silver / gold will benefit us if such a scenario played out in the future. Well I know that is one reason why I am looking to add to my silver investment holdings on further weakness.

    Re: Bearish sentiment; I guess what I was trying to understand is why most retail investors remain bearish and concomitantly start pulling funds out of markets, and look to “safe haven” term deposits en mass when the markets are now pricing in a lot of the fears that are being widely reported in the media.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 487 Stillgotshoeson // Dec 21, 2011 at 9:52 am

    Australia it is Personal debt load that is the problem, yes a small amount of the population have money and are cashed up but a much larger portion are living week to week and some of those are going backwards.

    I agree with you Plornt that many companies are now at attractive pricing and may not drop that much more despite what the market does.

    I still expect the ASX to go below 3000 in the short to medium term, most of the drop is going to come from the RIO, BHP and the Banks.. Most other shares have already been hammered. The top 10 stocks have such a huge weighting on the index.

    I am a fundamentalist trader.. The 2 biggest fundamentals are fear and greed, having an understanding of the fear and greed in the economy has enabled me to grow my portfolio consistently.

    My timing may not be day perfect but picking the sentiment has been very good.. Good enough to consistently profit from it.

  • 488 Plornt // Dec 21, 2011 at 12:11 pm

    “I agree with you Plornt that many companies are now at attractive pricing and may not drop that much more despite what the market does.”

    There are too many cheap companies and not enough cash lol. Just purchased some Harvey Norman stock as I believe the retail sector is way oversold and conditions will improve into January. The fact that Gerry Harvey has bght some also give credence to the possibility retail sales are picking up. Didn’t make the same mistake twice and bought a better quality retailer; tried not to be foolish!

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 489 Plornt // Dec 21, 2011 at 12:18 pm

    “I am a fundamentalist trader.. The 2 biggest fundamentals are fear and greed, having an understanding of the fear and greed in the economy has enabled me to grow my portfolio consistently.”

    I am moving towards fundamentals investing. You have to put up with more volatility but that is where the serious capital gains are made. Passive investing; less is more.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 490 Plornt // Dec 21, 2011 at 12:29 pm

    Still what do you use to value companies; do you have a system?

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 491 Plornt // Dec 21, 2011 at 12:33 pm

    “The fact that Gerry Harvey has bght some also give credence to the possibility retail sales are picking up. Didn’t make the same mistake twice and bought a better quality retailer; tried not to be foolish!”

    My system is also firing for Harvey Norman, not that I base my decisions to enter an investment on that fact.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 492 Stillgotshoeson // Dec 21, 2011 at 2:52 pm

    Yes I have a system, I don’t wish to disclose it.

    I have 2 superannuation accounts, 1 an industry 1 through work (excellent life insurance policy) and I have a Self Managed Super Fund. The downside to super is the locking away, however the tax benefits are excellent, especially in regards to CGT.

    I also have investments outside of Superanuation.

    My investments are structured to cover different aspects of my life at different times.

    No matter how much I like a company I will still always limit my financial exposure to it.

    My plan is to retire or at the very least semi retire before 50 and live off my investments until I can access my super which will fund the next stage of my life, so far all is going to plan.

    I have no desire to own a McMansion nor a sports car.
    I have seen too many people work past 60, 65, 70 even and have poor quality of life afterwards or worse not live to enjoy retirement at all.

    To quote from Barefoot Investor.. “I don’t need to buy stuff I don’t need to impress people I do not like”

    @HVN I expect it to go a little lower than this circa $1.70 .

  • 493 Biker // Dec 21, 2011 at 4:24 pm

    Shoes: “I have no desire to own a McMansion nor a sports car.”

    Typo over at DRA, then? ;)

  • 494 Stillgotshoeson // Dec 21, 2011 at 4:36 pm

    Biker // Dec 21, 2011 at 4:24 pm

    Shoes: “I have no desire to own a McMansion nor a sports car.”

    Typo over at DRA, then?

    Must be, I have posted multiple times over on DRA that I don’t need a McMansion or a sports car* Terminology is usually Ferrari but inference is the same…

  • 495 Ned S // Dec 21, 2011 at 4:41 pm

    Wouldn’t mind seeing people’s thoughts on what interest rates might do over the next 5, 10 and 20 years. They’re going to be extremely important for long term investors is my thought – As a baseline. My personal feeling is that they’ll remain historically low. Though I’m also quite concerned I could be absolutely and totally 100% wrong.

  • 496 Plornt // Dec 21, 2011 at 4:41 pm

    Well I ran some systems through the EUR.USD. It says to go long but there is just too much risk in it for me to get involved; although, i may change my mind hmm. Perhaps long dated FXE calls?

    From a purely TA perspective there seems to be people likening the EUR.USD price patterns to the 1979 collapse; well thats what i’m interpreting it as from putting myself on the other side of the trade. That price pattern for the last 9 months looks more likely to bounce and form a double top @ 1.60, but again this is just guessing as TA is seldom reliable (for me anyways). So many people are calling for falls on the EUR.USD. Seem similar to r when i went long the EUR.USD around 1.25 in 2010. Wish I rode it a lot further as it went to 1.50! I may buy the EUR.USD for a long term hold; not sure. I love these situations where everyone despises it, predicts the end, and they are all sitting on one side of the boat!

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 497 Plornt // Dec 21, 2011 at 4:43 pm

    “From a purely TA perspective there seems to be people likening the EUR.USD price patterns to the 1979 collapse”

    That should read 1980-1985 collapse

  • 498 Stillgotshoeson // Dec 21, 2011 at 4:44 pm

    I do however like these… Especially the Mk VII

    They can be had for less than $30k so not what I would call a costly vehicle…

    http://www.bolwellcarclub.com.au/models.html

  • 499 Biker // Dec 21, 2011 at 4:49 pm

    Shoes: “I have posted multiple times over on DRA that I don’t need a McMansion or a sports car…”

    Yes, many many times. Once was probably enough. ;)

    Wondered when I saw your ‘need’ if this was an early MLC…

  • 500 Plornt // Dec 21, 2011 at 5:58 pm

    “Could do wonders for your social life. Too many young folk spend the first 45 years furiously trying to amass wealth in an apoplectic economic climate inconducive to same: government interference, climate-change proponents, collapsing nations, swarms of economic refugees…!”

    Biker is getting bearish — it must be time to have net long exposure…
    ;)

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 501 Ned S // Dec 21, 2011 at 5:59 pm

    And here’s me just sinking a bottle of spirits (tho’ one of them’s a bit unusual – I generally try to keep it to a bottle of port – A tad less even?) and sort of continuing to watch the world do its thing …

  • 502 Biker // Dec 21, 2011 at 6:26 pm

    Plornt: Biker is getting bearish — it must be time to have net long exposure… ;)

    Nah, y’see we avoid all that government/greenie/GFC stuff with property. Take all their solar subsidies, cut out the letters in the ‘I Support Fishing Sanctuaries’ stickers so they read “I Fish Sanctuaries’, and make sure we’re invested only in countries which sidestepped the GFC… . :D

    Any port in a storm, Ned, but The Grove’s Vintage Shiraz Port and Donnelly River’s TP are hard-to-beat… . :)

  • 503 Plornt // Dec 21, 2011 at 6:49 pm

    “Nah, y’see we avoid all that government/greenie/GFC stuff with property. Take all their solar subsidies, cut out the letters in the ‘I Support Fishing Sanctuaries’ stickers so they read “I Fish Sanctuaries’, and make sure we’re invested only in countries which sidestepped the GFC… ”

    Sounds like you are very wise and prudent investor by sticking within your circle of competence (i.e. real estate). You seem to be always rational, intelligent and a modest person with much to be modest about. Hope you continue to do well :).

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 504 Plornt // Dec 21, 2011 at 7:31 pm

    “@HVN I expect it to go a little lower than this circa $1.70 .”

    Yes Still thats always a possibility. Based on trailing earnings its running on a pe of of 8.5. Obviously there will be some drop in earnings this FY, but there is enough margin of safety with that sort of trailing pe; which already is reduced from the ~28c eps peak. I doubt earnings would collapse given Gerry is buying and you still have below bookvalue protection. In the last 10 years HVN has only traded below bookvalue once, and that was during the March 09 market bottom.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 505 Biker // Dec 21, 2011 at 7:33 pm

    Plornt: “…a modest person with much to be modest about.”

    Yes, one might even contend I’m cerebrally-challenged, a ‘mum’n’dad investor’ who never strayed where none but angels tread. These ‘systems’ intrigue me. My brother had ‘a system’.
    Used it successfully at Burswood Casino for a while. Sadly we were never quite smart enough to create ‘a system’… but we were able to pay off all his debts and save my parents’ farm.
    We figured out later a coin toss might have served him better.

    Quite envious of everyone with ‘a system’. Wouldn’t have a _clue_ how to go about developing one. Education system let me down there… . Every time a sports car passes me, even a KITty car, I think to myself “Now that fella must have a system… .”

    “Hope you continue to do well”

    Thanks. Nothing to it, really. Owe much of it to ‘Property for Dummies’ Random House, $19.95.

  • 506 Plornt // Dec 21, 2011 at 7:48 pm

    “Used it successfully at Burswood Casino for a while. Sadly we were never quite smart enough to create ‘a system’… but we were able to pay off all his debts and save my parents’ farm.
    We figured out later a coin toss might have served him better.”

    Sorry to hear that. My systems are adaptive so they will change as the markets change. Also I continue to create new systems all the time so loss of edges are not a problem for me. If the system doesn’t work anymore my risk management will simply force me to stop using said system. My systems are basically tied to my natural ability to be creative, which i’ve had since i’ve been very young. So I guess it would be difficult to replicate as you would need to be able to find the system variances which can be tricky and requires a lot of creativity.

    You can keep doubting me Biker i love it; will drive me to generate even better returns and make my risk management water tight. You’ve been continuously skeptical of me yet I am still here and you are still trying to find holes to discredit me :). You are a very poor judge of character it seems :). Results win over time not words and superior english skills ;).

    BTW you did mention awhile ago you used simple systems for your real estate endeavours :).

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 507 Ned S // Dec 21, 2011 at 11:55 pm

    Haven’t read the thread thru but just saw the “a modest person with much to be modest about” bit – LMFAO! :D (A Winnie C rip orff??? – Or some such? And good fun.)

    All good … Will come back tomorrow and attempt to digest a bit more thoroughly perhaps – On the off chance someone’s told me what interest rates are gunna do over the next 5, 10 and 20 years. (But it’s all good for a laugh in the interim.)

    Cheers to all … Life’s a HOOT! :)

  • 508 Stillgotshoeson // Dec 22, 2011 at 12:19 am

    Ned S // Dec 21, 2011 at 11:55 pm

    Will come back tomorrow and attempt to digest a bit more thoroughly perhaps — On the off chance someone’s told me what interest rates are gunna do over the next 5, 10 and 20 years. (But it’s all good for a laugh in the interim.)

    They are going to do what they have always done Ned… Go up and down :)
    They are closer to their low point than they are to their high point of the cycle…
    Financially it makes more sense to allow for higher rates not budget for lower rates…

  • 509 Plornt // Dec 22, 2011 at 6:57 am

    Thought this might interest some people –
    Candlestick Charting not profitable:
    “Using robust statistical techniques, we find that candlestick trading rules are not profitable
    when applied to DJIA component stocks over 1/1/1992 – 31/12/2002 period. Neither bullish
    or bearish candlestick single lines or patterns provide market timing signals that are any better
    than what would be expected by chance. Basing ones trading decisions solely on these
    techniques does not seem sensible but we cannot rule out the possibility that they compliment
    some other market timing techniques.”
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=980583

    Hammer candles can break down further. For example look at the supposed “hangman” candle on the XAO on Dec 18 2007. Albiet the candle was not perfect 2 x line to body, but did not have a shadow. You got a very short term bounce and then crashed to 5222. It was just so unrealible over time frames exceeding several weeks. Might as well go to the casino or throw some darts ;).

    Granted there are many other more complicated candle patterns to indentify. I remember trying many of them like Doji Stars or Downward Gapping Tsukis and sailor moon siamese ninjasticks ;) all with results no better than a toss of a coin.

    http://www.amazon.com/Evidence-Based-Technical-Analysis-Scientific-Statistical/dp/0470008741/ref=sr_1_1?ie=UTF8&qid=1324504641&sr=8-1

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 510 Plornt // Dec 22, 2011 at 8:15 am

    “On the off chance someone’s told me what interest rates are gunna do over the next 5, 10 and 20 years. (But it’s all good for a laugh in the interim.)”

    Ned I have an article somewhere that intelligently and rationally discusses what you are looking for. Will find it and post a bit later.

  • 511 Plornt // Dec 22, 2011 at 6:57 pm

    Well i’m off again, will comeback in a few months to see how things pan out, as I have other things I must do. XAO should be higher by then. Good luck and hope everyone is successful with their investments and/or trading.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 512 Lachlan // Dec 22, 2011 at 7:18 pm

    Re TA….I just like to use some simple support and resistance concepts… and some indicators like RSI to some degree and divergences…. maybe studying some correlations. Maybe refrain from being caught up in the dramas. Make a fundamental decision, buy cheap or at a support/oversold area, stick with the program…buy and hold maybe.

    Good luck with your endeavours Plornt…make sure you come back to talk to us if something blows up in the meantime ;)

  • 513 Plornt // Dec 22, 2011 at 7:32 pm

    “Maybe refrain from being caught up in the dramas. Make a fundamental decision, buy cheap or at a support/oversold area, stick with the program…buy and hold maybe.”

    Probably the smartest way to do it :) I think fundamental long term investors are the main winners in this game which I have switched to.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 514 Stillgotshoeson // Dec 22, 2011 at 8:10 pm

    Fundamentals are the way to go…

    These include, but not limited to:

    Economic conditions, Personal Risk Factor, What the company does, likely demand, company debt levels, country (sovereign risk)
    Company Management (google directors for prior information)

    Research is your friend, maybe time consuming but can save you thousands.

    See you on your return Plornt. Expectations are for more volatility in the market next year, maybe QEIII from the US Fed in first half 2012…

  • 515 Lachlan // Dec 22, 2011 at 9:14 pm

    how do you see NCM now Shoes? I missed my $30 bottom while out bush. Might buy tomorrow..maybe. I was looking at a couple divi payers… maybe a coal play. I like the way the markets are shaping now for the short-med term…esp if we rally straight back to 4350 from here.

  • 516 Stillgotshoeson // Dec 22, 2011 at 10:09 pm

    Psychological support level around $30, not fundamental so may go below. I think still good buying at around these levels.

    SBM under $2 bucks are excellent buying as well I believe.

    Still may see a bit more decline in Gold/Silver prices before the run up again.

    Accumulate shares on dips as I believe you currently do anyway.

    PRU are looking good at these levels.. Made over 20k on them last time, bought at similiar level and sold just over $4. Have done the same bought more @$2.52

  • 517 Ficus // Jan 8, 2012 at 9:14 pm

    Hi

    Just wondering how people feel about the price of BHP at the moment. I was going to start trading it on low margins. Maybe 1-1.5%. Looks like there is support at about $34 and resistence about $37-38

    Cheers F

  • 518 Greg Atkinson // Jan 9, 2012 at 8:21 am

    Ficus at this stage I am wary of the miners simply because prices for iron ore, coking coal & copper for example appear to be trending downwards. BHP is certainly a quality blue-chip stock worth watching though.

  • 519 Ficus // Jan 9, 2012 at 10:41 am

    Thanks Greg, Does anyone hold GBG. I have some, they at a low but I think will be good in next 1-2 years. Any thoughts?

  • 520 Stillgotshoeson // Jan 10, 2012 at 2:01 pm

    100k Portfolio.

    IMF 7407 @ $1.35 $9999.45
    ABY 13000 @ $.765 $9945
    GRY* 8500 @ $1.165 $9902.50
    PRU* 3900 @ $2.54 $9906
    FML* 185000 @ $.054 $9990
    RAU* 2500000 @ $.004 $10000
    BPT* 7500 @ $1.30 $9750
    API 37700 @ $.265 $9990.50
    BKP 714000 @ $.014 $9996
    CTN 11000 @ $.89 $9790

    Total + $199.50 Brokerage $99278.45

    Shares with an * are shares I currently own.

    Will update from time to time if not trading. Will update same day as I make a trade.

    These are not recommendations to buy and I am not a licensed financial advisor. Own diligence is required whenever investing.

  • 521 Stillgotshoeson // Jan 23, 2012 at 3:17 pm

    ABY 0.880 13000 $11440
    API 0.285 37700 $10744.50
    BKP 0.015 714000 $10710
    BPT 1.490 7500 $11175
    CTN 0.915 11000 $10065
    FML 0.053 185000 $ 9805
    GRY 1.360 8500 $11560
    IMF 1.350 7407 $ 9999.45
    PRU 2.830 3900 $11037
    RAU* 0.003 2500000 $ 7500

    100K Portfolio $104035.95
    + $ 721.55 Cash
    $104757.50

    * Volumes have been extremely low.

    No trades made to date.

  • 522 Greg Atkinson // Jan 24, 2012 at 9:58 am

    I am in sitting on my hands mode at the moment. The Baltic Dry Index is down near the the GFC low and we have the IMF talking about a possible global economic depression. I get the feeling that we might have a nasty move downwards after the Chinese New Year break and that the All Ords/ASX could slide below 4000.

  • 523 Ned S // Jan 24, 2012 at 10:39 am

    A thought that comes to my mind is that the US seems to be feeling happy that they aren’t doing as bad as lots of others so the DJIA goes up and our market gets some spin off. But given the hand wringing and nasty predictions out there by those one assumes know a bit (IMF and World Bank), markets going up now does seem strange.

  • 524 Stillgotshoeson // Jan 24, 2012 at 11:10 am

    I fully expect the All Ords/ASX to fall, Still think we will hit new (GFC) low before it is all over. Not enough to stop me having some exposure to the market, some sectors should outperform still.

    Volatility will continue for a while yet imho. All Ords/ASX are going to be up and down.

    DUe to my belief of a new low to be reached, but no idea when, I will continue to shy away from the the banks and the 2 big miners for a little while longer yet.

    If the rumoured Japanese banks do come here, that will impact to some extent our big four and their profit line. Reduced earnings will equal reduced dividends.

    A friend of mine (English) living in Denmark, works for a ship broking firm, he says things are very quiet in the shipping world…

  • 525 Lachlan // Jan 28, 2012 at 4:02 pm

    Short term we will almost certainly run to 4350/4400 on the xjo and 1.08 on the aud/usd before some kind of a pause or reversal.
    Nice run up on my shares continued last Friday with a further 1.7% gain overall.
    Action has been nice and strong on gold and silver but the metal markets are paper mirages still so I wont rule out the possibility of lower targets… however the chances near term are decreasing as the action becomes more vigorous.
    My position for the long term on all these things remains bullish. Intermediate term I stay neutral until this range breaks up.
    I guess if we are to go lower first Shoes then it could be after a rally here to 4400 or 4600 or even back to 5000 odd.

    BDI certainly does look sad Greg… in the news a lot this last week or two. Stocks may still rally, or maybe not…they can be irrational…anybody’s guess.

  • 526 Stillgotshoeson // Jan 29, 2012 at 2:05 pm

    4500 +/- 100 or so I can see, 5000 I just can not see happening without actual money printing in the Northern Hemisphere, as opposed to talk of money printing.

    Europe is still a basket case. Unemployment/underemployment are starting to rise here and further rate reductions on mortgage rates are looking to be minimal if any into the near future regardless of what the RBA does. These are the things I expected to occur last year but “can kicking” delayed it a little longer.

    We are coming to the end of the road and soon there will be no where to kick the can anymore.

    Bank. “we see you have maxed out your credit card Mr Nation, here have an increased limit”
    Bank “we see you ave maxed out your credit card again Mr Nation, here have a limit increase”

    Can only happen for so long then it is over.

    I think we will see the money printing this half of 2012.. How long it boosts the market for remains to be seen.

  • 527 Lachlan // Jan 29, 2012 at 2:33 pm

    USDX has made a reversal too Shoes. Whether its a pause before more inflows to treasuries begin or a the start of a decent sell off I don’t know.
    You say Europe is still a basket case, I agree and despite talk of Greek default ect I tend to suspect this will be a slow band aid removal with political motivations key to that suspicion. And therefore as this process continues I can see a lesser chance of a quick resumption in up trend and higher chances of sideways grinding below the 5000 area and even a belt down to 09 lows and back. If we go lower than that…I hope we don’t but if so then so be it.

    The Fed will print everything they need whether they tell us or not.

  • 528 Ficus // Jan 29, 2012 at 6:52 pm

    Does anyone know much about the mining services sector. I am looking at making an investment in Bradken, Monadelphous, Decmil or something similar. Interested in small caps. At the moment swaying towards Decmil ( good track history and High ROE).

    Cheers

  • 529 Lachlan // Jan 29, 2012 at 8:22 pm

    I am no expert Ficus, won’t speak for the others. I like to make a few predictions with the fellas here for fun but they’re just personal views and not advice. I like to make sure my shares have some cash reserves, a good market and expectation of earnings or a big find but beyond that I am price chart analyses trader but an amateur. Price movements give at least some hint of what every market participant is thinking whether mum and pops or professionals or manipulators.

    On QE here is a link to show the program in some of it’s glory

    http://www.ritholtz.com/blog/2012/01/living-in-a-qe-world/

    I believe it is possible this program may endure for a long time while all sorts of structural changes take place across the globe…..and depending on the tolerance of the masses.

  • 530 Greg Atkinson // Jan 30, 2012 at 8:11 am

    Ficus Monadelphous is is a stock within the Shareswatch Random Portfolio so can get some idea of how its share price has been tracking by looking here: Random Porfolio

  • 531 Stillgotshoeson // Feb 3, 2012 at 9:48 am

    My Bolivian Play has taken a hit to the downside Lachlan on fears of nationalisation as discussed last year.

    IMF 7407 @ $1.31.5 $9740.20
    ABY 13000 @ $.89.5 $11635
    GRY* 8500 @ $1.32.5 $11262.50
    PRU* 3900 @ $2.96 $11544
    FML* 185000 @ $.054 $9990
    BPT* 7500 @ $1.495 $11212.50
    API 37700 @ $.295 $11121.50
    BKP 714000 @ $.016 $11424
    CTN 11000 @ $.995 $10954

    Sold RAU 2500000 @ .002 Loss $5000

    100k Portfolio Shares $98883 Cash $5721 Total $104605

  • 532 Lachlan // Feb 3, 2012 at 6:33 pm

    I have shares like that which are highly speculative and they are also highly volatile. They go up and down by massive percentages. The reason I have a very small position on explorers is because of the oversize gains available. If I wait long enough I will pick up a 5-10X gain….granted its possible one of them may blow up. The winners should cover the losses easily. My rule is not to sell in any down draft and I can only rest easy with that because I invest small enough to not give a hoot if they hit zero. The upside on a share like RAU was obviously measured in 1000′s of % and that remains true even if they do fail for those reasons we talked about last year.
    My position on shares overall is small but I love the game of course and will keep building a quality portfolio as are you. Otherwise I am mostly physical assets. Looking to buy a block this year also for my business (which is overtaking my house) but in a growth area and I expect to get a very good discount on the price.

  • 533 Lachlan // Feb 3, 2012 at 6:42 pm

    I’m not saying that Id hold the RAU’s either Shoes. I know we both use differing strategies and there are plenty that work.

  • 534 Stillgotshoeson // Feb 3, 2012 at 7:40 pm

    I still have my holding of RAU Lachlan. The 100k Portfolio is not a real portfolio, It is up just to see how it would do if traded in the real world. It does however contain some companies I do hold shares in.

    My direct exposure is not great. I aready have significant gains to offset the loss if it goes belly up. Current position of the company is they are holding enough cash for the next 6 months. They are in mid contract for the sale of their North Queensland assets for scrip and cash in another company.

    Current workings at the Bolivian mine are suspended further to discussions with the Bolivian Government. Republics Bolivian mine had received great interest from companies willing to (help) finance the mine, however all companies expressed concerns over the Bolivian Governments willingness to nationalise mines at the moment.

    Suspension of the mine and a willingness to abandon the project may prompt the BG to offer some sort of deal, even if they intend to “amend” such deals in the future. Get the mine to production stage then take it over ;)

    Even allowing for the “supposed” hit on the 100k portfolio it is still in front after the loss (capital loss carried over against future capital gain on sale)

    Going over other share picks to add to the portfolio to replace RAU.

    Might put a dividend play in the portfolio.. Will think about it over the weekend.

    The coffee shop is still doing very well, partner wants to expand the business to another shop. Has offered to buy me out if I want at a handy profit to my initial outlay. Tempting. I don’t do any work at the place, I was just a financial partner. There is a dwelling above the shop, he wants to try and buy it and open it up as an upstairs area.

  • 535 Stillgotshoeson // Feb 21, 2012 at 5:28 pm

    IMF 7407 @ $1.35 $9999.45
    ABY 13000 @ $..78 $10140
    GRY* 8500 @ $1.24 $10540
    PRU* 3900 @ $2.87 $11193
    FML* 185000 @ $.052 $9620
    BPT* 7500 @ $1.685 $12637.5
    API 37700 @ $.28 $10556
    BKP 714000 @ $.015 $10710
    CTN 11000 @ $1.03 $11330

    Dividends CTN 3.8 cents per share $418

    Shares $96725

    Cash $ 6137

    Total $102862

  • 536 Ned S // Feb 22, 2012 at 7:55 pm

    We’ve been in a bull market for close to three years now. So just out of very general interest, how long do bull markets last “on average”? (And is that even a sensible question to ask?)

  • 537 Stillgotshoeson // Feb 23, 2012 at 11:16 am

    Secular Bull Markets can go a decade or more, Primary trend markets are 3 to 5 years, With downturns lasting 18 months or so.

    I do not think we are in a secular bull market at this time and the primary trend will turn to the downside.

  • 538 Plornt // Feb 24, 2012 at 2:13 pm

    “We’ve been in a bull market for close to three years now. So just out of very general interest, how long do bull markets last “on average”? (And is that even a sensible question to ask?)”

    3-5 years usually on a cyclical basis. Secular bull markets go for 17.5 years and likewise bears. We are still in a secular bear market, so there will likely be another crash before the secular Bull starts, but that is likely 3-4 years from now according to my system. The XAO has returned very poorly over the last few years mean reversion is going to occur, and people will be scampering to get long. People seem to be correlating this with the 87 crash, and proceeding double bottom? Yet not accounting for the timeframes for such movements to occur are probably multiples gives the duration of the previous cyclical bull. Even so history doesn’t repeat it rhymes, so analysing 90s or 80s corrections is futile in terms of consistency of timing. Noone can time things property. I’d rather be early than underweight into a cyclical bullmarket, and look foolish at the end of it. If you buy value your downside is limited in the long term.

    I have started pulling out of American equities due to valuation concerns where price is too close to intrinsic value (excluding financials), and shifting more into Australian equities given the massive disparity. XAO should really be 6,000 right now; its that simple. Massive multi-year move comming. I couldn’t be more bullish Australian equities right now. Some of the company valuations are redicuous.

    My LT system for the DJIA says the bull ends 2014 and likewise for the XAO; followed by 2017 as the secular buy entry (albiet it may occur in 2015 or 2016). That said my system will adapt if the Bull keeps going (it will keep me in moves up to 10 years). There is every chance these XAO levels are the secular lows. Then again I could be completely wrong about this; but given the valuations of some stocks one should make money in a flat to down market in any event.

    Thanks for posting still; I been following your portfolio. I will choose 4 stocks and see how they fair.

    Qantas: Intrinsic Value 9.15$
    OST: Instrinsic Value: 4.2$
    Paperlinx: Instrinsic Value: 1.40$
    Bank of America: Instrinsic Value: 31$

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 539 Plornt // Feb 24, 2012 at 2:22 pm

    “Plornt // Dec 19, 2011 at 9:44 am

    Well I think we are at the XAO bottom or close to it. Next rally is going to heavily breach the 200dma imo, and based off purely TA the DJIA is headed for a double top around 12,800, but I hate basing decisions purely off TA, so this is just a guess at best.”

    Well the DJIA breached 12,800. Its looking a bit stretched right now. Lets see the XAO go straight through the 210dma whilst many people keep trying to short equities in a rising market, or praying for the next apocalypse.

  • 540 Plornt // Feb 24, 2012 at 2:24 pm

    Not many people are actually contrarian with their decision making i’ve noticed in terms of financial allocation. Be contrarian by action not with words.

  • 541 Stillgotshoeson // Feb 24, 2012 at 2:49 pm

    IMF 7407 @ $1.32 $ 9777
    ABY 13000 @ $.755 $ 9815
    GRY* 8500 @ $1.225 $10412
    PRU* 3900 @ $2.92 $11388
    FML* 185000 @ $.051 $ 9435
    BPT* 7500 @ $1.765 $13237
    API 37700 @ $.29 $10933
    BKP 714000 @ $.016 $11424
    CTN 11000 @ $1.085 $11935
    EXS 30000 @$.195 $ 5870

    Shares $104226
    Cash $ 267

    Portfolio $104493

  • 542 Plornt // Feb 24, 2012 at 11:53 pm

    Thanks for posting Still. Looks to be moving well (up ~5%). Look forward to seeing your returns over the next 12 months. I am optimistic your portfolio will do well.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 543 Lachlan // Feb 25, 2012 at 6:11 am

    G’day Plornt

    My acquisitions in last 6 months

    IGR @ .415 last .585
    NHC @ 5.63 last 5.75
    AWE @ 1.38 last 1.785
    CDT @ .355 last .195
    GOLD @ 158.50 last 160.85

    This looks good but the reason I am just underwater overall is that I have others (small caps) some of which show good gains but three of which have taken a big sell off. The good thing is that these same ones, all of them are showing potential tech reversals. So I am upbeat as are you going forward…but we will see. Either way I am buy and hold until long term sell signals arrive for individual cases or maybe until I can take profit and re-enter after a sell off but that’s a game for people with more money invested. I am working up from a very small base but cant see why I would not hold quality shares long term over cash even in this climate. The GFC will be resolved imo and the world will keep on rolling along but some places will be badly affected I believe. Will Australia be in for another hit at some stage? I think it has to be very likely but it could be a while still and once again I would look to buy in to weakness. It’s the only way esp in a sideways market.

    Good to see you back mate.

  • 544 Plornt // Feb 25, 2012 at 8:36 am

    ” The GFC will be resolved imo and the world will keep on rolling along but some places will be badly affected I believe. Will Australia be in for another hit at some stage? I think it has to be very likely but it could be a while still and once again I would look to buy in to weakness. It’s the only way esp in a sideways market.”

    Yep. We still have the housing bubble unresolved, and also China slowing will have an effect, but like you said it could be a while. There will always be problems in a few years; if you look back historically over the past 100-110 years; at the start of every bull cycle people are generally worried about something. You climb a wall of worry. They may end up being right, and we could be completely wrong however, so have to always re-evaluate reasons why the bears are possibly wrong, and see if things have changed.
    I think the XAO will outperform the DJIA over the next few years. DJIA might be sideways to flat. Be interesting to see how uncorrelated the moves of both indexes are now, and then compare the duration of that correlation, and how much it reverted back to the mean historically (or not).

    Many Resource small caps are pricing in a Chinese collapse it seems, so I would assume they will rise irrespective of where commodity prices head given their extreme oversold status (as your technical picture has shown). I notice Jim Rogers started a resource equities fund back in early 2011, so that is a great sign given prices have fallen significantly further than the creation of that fund.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 545 Plornt // Feb 25, 2012 at 2:20 pm

    “I am working up from a very small base but cant see why I would not hold quality shares long term over cash even in this climate.”

    My capital is small too; we have to start somewhere :). I am trying to limit my share turnover. Its tough to switch to only investing in stocks; need to develop more patience. Made a lot of mistakes in my valuations albiet a rising tide lifts all boats, so mistakes don’t look bad, but still no excuse for making them. Look forward to my instrinsic values being hit over the next 8-10 years (unless earnings continue to collapse and significantly change the long term intrinsic value).

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 546 Lachlan // Feb 25, 2012 at 2:28 pm

    Having said that Plornt there is no doubt in my mind that there will be no organic recovery through the current monetary paradigm/status quo. It seems doomed.

    I don’t underestimate the cooperation happening between governments, CB’s and other politically motivated bodies with power to kick the can and mould the future to some degree. It has been happening for a long time and will imo continue with some nations enjoying prosperity and others descent into poverty. I have a Jim Rogers type view on China and I believe a wealth transfer from west to east will continue.
    Some places will suffer a lot. Australia is positioned reasonably well considering our natural prosperity but i do not factor in any international geopolitical threat….it seems a waste of time with so many variables. The status quo above may be at threat if international actor/s in the play assume new roles without warning. Anyhow it’s not a subject I want to discuss but just letting you know I do have some agreement with the bears on basic levels ie the debt problem. The threat I see to stocks is devaluation in real terms not nominal.

  • 547 Stillgotshoeson // Feb 25, 2012 at 4:07 pm

    I am playing the latest asx share game too. Have bought 4 stocks with my “pretend” $50k to spend that they give you.

    Company list that you can buy from has about 100 companies in it.

    Runs from 16th Feb to 30th May.

    Your current portfolio (live)
    Portfolio total $53,261.76

    As it is not real money I do not actively monitor or trade stocks in the game. Check from time to time but generally speaking just let it ride.

    Current ranking is in the top 100 national and top 10 State.

  • 548 Greg Atkinson // Feb 27, 2012 at 6:18 pm

    As I have commented before I am waiting for the focus to shift from Europe and onto the slowdown in China which I don’t think will end in a soft landing but rather a painful hard one. If this does happen then the Australian stock market will get another shake-out led by a rout across mining stocks, but then I would be looking for the next run up past 5000 to take hold.

    Having said that, my timing is lousy so it could be two years (or more?) before we see the ASX All Ords/ASX 200 hit 5000 again :)

  • 549 Lachlan // Feb 28, 2012 at 8:00 am

    Other than big moves downward, long-winded side-ways moves are another way of resolving things.
    Looking at US gold, AUDUSD and XJO it looks like another little spike up for the short term. I’m thinking 1.10 on our dollar a good short term probability. The XJO is harder to call but I hope to see 4400 still.

  • 550 Lachlan // Feb 28, 2012 at 6:02 pm

    Greg I missed a chance to buy TLS at 3.22 which would have been the spot imo. My guess is now it will re-trace this sell off back to the high it just came from. Beyond that I don’t know but with the high yields I would not worry too much about it other than picking off a good sell off to some horizontal support like this.

    This is only my unqualified opinion and not a share tip of any kind.

  • 551 Greg Atkinson // Mar 1, 2012 at 10:31 am

    Lachlan I am still waiting for the market to get down near 4000 or lower. I fear we need to take a China hit, absorb the reality that Australia will probably need to endure a period of lower or negative growth & then slowly head up towards 5000 again.

  • 552 Lachlan // Mar 2, 2012 at 12:15 pm

    Just my gut feeling is that a China hit will happen as you say but I think it may be a little further out into the future. China has managed a retreat from the open money spigots and now they are turning them back on again. I believe their economy will respond. You can remind later Greg me if I am wrong ;)

    Despite the high dollar and China’s recent slowing the ASX200 produced 5.5% increase in aggregate profits according to Commsec.
    The worst component of Oz seems to be households and small business still and many shops are doing it hard locally.

    I think we could easily see 4000 again too, but in the very very short term I think we are going to pop to 4400 and I hope up to 4600 but that latter figure is a hope not a call. Since we are locked in a range who knows how long we will stay here.

    It is at least possible to see 5000 again before 4000. I can hope for that too :)

  • 553 Stillgotshoeson // Mar 3, 2012 at 9:46 am

    IMF 7407 @ $1.42 $10518
    ABY 13000 @ $.815 $10595
    GRY* 8500 @ $1.165 $9902
    PRU* 3900 @ $2.81 $10959
    FML* 185000 @ $.051 $ 9435
    BPT* 7500 @ $1.56 $11700
    API 37700 @ $.28 $10933
    BKP 714000 @ $.016 $11424
    CTN 11000 @ $1.12 $12320
    EXS 30000 @$.19 $ 5700

    Shares $103486
    Cash $ 323.25

    Portfolio $103809

    BPT Dividend $56.25

  • 554 Lachlan // Mar 5, 2012 at 9:58 am

    On TLS is a RSI/price divergence which might help bring the price back towards 3.00 dollarish. Will watch the current action to see if we are going to fail and clear the recent high and retest the recent low around 3.22.

  • 555 Greg Atkinson // Mar 6, 2012 at 11:01 am

    Lachlan we are seeing a bit of a China induced pullback now. Some more slowing data out of China this week will push the market down towards 4000 I would expect.

    Personally I’d like to see the stock market appreciate that there is no such thing as a miracle economy, especially not a command one. Let’s accept that China will at some point enter a recession, adjust and then move on :)

  • 556 Lachlan // Mar 7, 2012 at 5:28 am

    Well Greg the pullback is in progress for sure.
    A good lesson on the Dow, gold, AUDUSD and XJO is that buying breakout trades is risky for short term trades as all of the breakouts were crunched some days ago. Anyhow I see this as another buying opportunity and I am cashed up. I think AUDUSD will hit 1.04 or close too which means it has some capitulating to do. DOW’s best support is around 12300/400 which might imply a flash crash shake-out is at least possible. That’s a dip I’d like to buy. Since the XJO has corrected here I like it a lot for an eventual break out more than ever with a pause at 4400/4430 and then on to 4600 where some shorts will enter. Not sure where it will bottom but imo it does not have the capitulation risk as does the DOW and AUDUSD which had become very extended. Silver could find support at 32 bucks.

    Shopping time! :)

    Sorry OT..we have had 335mm of rain in ten days.

  • 557 Lachlan // Mar 7, 2012 at 5:35 am

    Of course my calls are all based on the assumption we will most likely see risk rally (election year for Obama remember). Gold and silver trade in sympathy with risk for whatever reason….accept when someone decides to kick em in the butt overnight.

    These crazy ideas are not trading advice. ;)

  • 558 Plornt // Mar 7, 2012 at 7:01 am

    “Since the XJO has corrected here I like it a lot for an eventual break out more than ever with a pause at 4400/4430 and then on to 4600 where some shorts will enter. Not sure where it will bottom but imo it does not have the capitulation risk as does the DOW and AUDUSD which had become very extended. Silver could find support at 32 bucks.

    Shopping time!”

    Yes XAO will breakout (albiet it looks like its going to be one of those long winded highly volatile types). Could be one more pullback as Greg suggested on the China fears. Maybe 4,100-4,200. My system is triggering short on the XAO, and long at the sametime; on multiple duratons. Am not really phased by any adverse movements, as that is something you have to get used to. However, I am really not liking the DJIA from a technical perspective — there is definitely capitulation risk there Lachlan as you mentioned; it looks like that is going to at best go sideways; at worst collapse. No system shorts on the DJIA yet. I can see many trends breaking down through the 200dma. WMT looks bearish; HPQ looks bearish and many others.

    Gold statistical support at 1600. System short on that. I am not short anything atm, and don’t intend to. Gold and Silver will probably go sideways for 12-18 months before the next parabolic move, so be used to highly volatile range bound movements.

    “Lachlan I am still waiting for the market to get down near 4000 or lower. I fear we need to take a China hit, absorb the reality that Australia will probably need to endure a period of lower or negative growth & then slowly head up towards 5000 again.”

    I agree with the 4,000 call Greg. Even if we fall, we have a floor on our market somewhat, so downside is limited as you mentioned with your lower targets prior to going back towards 5,000. As Lachlan said our market is not over-extended, and has underperformed the DJIA considerably over the last few years. That can’t keep going forever.

    This drivel should not be taken as financial advice.
    Seek to obtain professional
    advice before proceeding with any financial decision.

  • 559 Plornt // Mar 7, 2012 at 7:06 am

    “Not sure where it will bottom but imo it does not have the capitulation risk as does the DOW and AUDUSD which had become very extended.”

    I agree with the capitulation risk re: DJIA. Looks massively overextended. I am looking to buy on weakness with the XAO, but not sure when yet. Agree it will breakout to 4,600 at some point in the future.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 560 Lachlan // Mar 7, 2012 at 9:21 am

    Got my shopping trolley out Plornt but nothing in it yet ;)

  • 561 Stillgotshoeson // Mar 7, 2012 at 1:52 pm

    Lachlan // Mar 7, 2012 at 9:21 am

    Got my shopping trolley out Plornt but nothing in it yet

    Offloaded 2 holdings and downsized on another today.

    Shopping trolley is out as well.

    Looking to increase holdings on a couple and add some new blood to the mix.

  • 562 Lachlan // Mar 7, 2012 at 3:55 pm

    G’day Shoes
    Had two bids in the water today but a fraction too far below the market on both. Will reveal my new aquisition’s should they come through however one is a re-purchase of a gold share we have both traded in the past and which I very much like right now despite having a lot of shares in market. The other is a West African play with a first year projection of 150K oz.
    Still watching TLS although I probably should just pay near 3.20 and be done with it considering the yield.

  • 563 Plornt // Mar 8, 2012 at 8:35 am

    “Will reveal my new aquisition’s should they come through however one is a re-purchase of a gold share we have both traded in the past and which I very much like right now despite having a lot of shares in market. The other is a West African play with a first year projection of 150K oz.
    Still watching TLS although I probably should just pay near 3.20 and be done with it considering the yield.”

    Look forward to seeing your picks Lachlan ! TLS looks great technically, but I can’t buy it at enough of a discount to intrinsic value ($7.10). Still a great potential return though. Additionally, subjectively their customer service has improved.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 564 Stillgotshoeson // Mar 8, 2012 at 2:41 pm

    Lachlan, My focus is still on precious metal miners as well… have toes in the water for a couple of new additions to my portfolio.

    NCM were a screaming buy yesterday, however my rules are my rules and I bought no more of them.

    There has been some shuffling at work, have received a promotion so I am hella busy at the moment, not getting much chance to view the markets.

    Company are sending me to the USofA in late September/October. Chicago, Atlanta, Dallas, Los Angeles, Minneapolis, Philly and finish up at head office in New York. 5 weeks living out of a suitcase.

  • 565 Lachlan // Mar 8, 2012 at 9:16 pm

    Gotta keep Focussing Shoes ;)
    I am surprised NCM came down to that price but certainly no sleep lost here…I keep to my rules too after learning the hard way.
    Sounds like your having fun out there Shoes. Good luck with the tour de USA.
    “I can’t buy it at enough of a discount to intrinsic value ($7.10)”…. Plornt are you saying you would like to see it cheaper? Come on, spill the beans, that’s what I like about these forums…and I’m keen to hear the worst about Telstra.
    My other 2 bids are still waiting for another down day…hopefully tomorrow.
    Might catch you all next week if your around..I take it Greg will turn up at least :)

  • 566 Plornt // Mar 10, 2012 at 6:14 pm

    “Plornt are you saying you would like to see it cheaper? Come on, spill the beans, that’s what I like about these forums…and I’m keen to hear the worst about Telstra.”

    Oh its just I have to buy at a certain % below intrinsic value, or I break my rules. Drawdowns were huge historically when I backtested and bought at 40% or more of intrinsic value. For example at 40% of intrinsic value there were 50%+ drawdowns (from cost) multiple times over a 20 year sample size. I’d need nappies if I had to go through that over and over !

  • 567 Lachlan // Mar 12, 2012 at 6:33 pm

    I obtained NMG @ 46cents but I think it has possible technical downside to 40 regardless. I have a bid on FML and TLS below current market. I am assuming TLS has bottomed long term.
    I think we will have another down draft this week. AUDUSD into 1.04′s. If the Dow tests some support I think it will be short lived like a flash crash and flash bounce. Dow equals sacred cow. Fed should water and feed appropriately but shake-outs are helpful.
    I am a little concerned about the DXY which looks good for some upside….yet USD gold conversely is looking strong too. Flight to safety week maybe? Back around Thursday to see what happened.

  • 568 Plornt // Mar 12, 2012 at 7:13 pm

    “I obtained NMG @ 46cents but I think it has possible technical downside to 40 regardless. I have a bid on FML and TLS below current market. I am assuming TLS has bottomed long term.”

    TLS may have hit its lowest intraday price over a longer duration. You are probably right. As I said before I think your long term returns will be good.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 569 Plornt // Mar 12, 2012 at 7:28 pm

    After the possible anticipated correction I can see so much upside right now. 5,700-6000 XAO as I stated before is where my targets are in a few years.
    I am so bullish the XAO; more bullish than when I said the DJIA was going to outperform the XAO by a substantial margin back in late 2009. My long term XAO timing system is showing a massive statistical duration move. Its huge.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 570 Plornt // Mar 17, 2012 at 5:10 pm

    This DJIA rally is amazing. Another system has kicked in on the DJIA (no shorts have ever fired on the DJIA yet), so it seems the DJIA rally has legs. Granted there has to be some kind of pullback here given the move, but we may not come off till next August.

    “Buy when everyone else is selling and hold when everyone else is buying.” J Paul Getty

    I am not buying anything at these levels, but will hold fully invested into any correction, and beyond for the long term.
    Still sticking with my DJIA call for a sideways at best market whilst the XAO significantly outperforms the DJIA.

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 571 Greg Atkinson // Mar 18, 2012 at 10:16 am

    Well the Dow Jones is certainly outperforming the All Ords/ASX 200 which is what I thought would happen back in early 2009 when I wrote: Is the golden era for the Australian stock market over?

    Spooky! ;)

  • 572 Lachlan // Mar 18, 2012 at 3:47 pm

    That is part of what makes our market reasonable buying at the moment fella’s, imo
    Interesting week last week. Dow rallied with the dollar through middle of last week.
    XJO went up against a falling AUD/USD.
    This week we have the CDS debacle in Greece first up and it seems JPM have a trillion dollars worth. Not that I am thinking the world will end. The move up in the DJ looks valid for a bit more. The presses will keep rolling against the tide of debt destruction.

    Plornt I have noticed good entry points for some miners this week and some strong correlations in the class ie divergences and prices oversold on long term support. I will try to buy more.
    Sold all my AWE’s for 1.89 and 30% plus gain last week. It’s been a strong rally short term from a descending wedge and “possibly” some ground to retrace. Thanks for the reminder on those Greg ;)
    I am beginning to take larger positions so as to reduce exposure/risk at resistance areas as was my habit with CFD trading…which I gave up for the leverage was high and I needed to get away from the market when my work picked up..which relies on seasons. Loving my share trading. Adrenaline junky maybe? I’ll just have to be careful I don’t get in too deep as was my policy.

  • 573 Plornt // Mar 18, 2012 at 3:50 pm

    Haven’t read that post before Greg wasn’t on this blog in early 2009. You got it spot on – great stuff.

    “Firstly I do not expect the Australia stock market to outperform the U.S. stock market when the next bull run comes along. Australia has just been through a great period of around 17 years without a recession and all good things come to an end. In addition Australia has in the last 5 years or so enjoyed rising assets prices, low unemployment, cricket wins, a commodities boom and has indeed been the lucky country.”

    This drivel should not be taken as financial advice. Seek to obtain professional
    advice before proceeding with any financial decision.

  • 574 Lachlan // Mar 18, 2012 at 3:52 pm

    If an awe rsi/price divergence means anything then awe could be a retrace to just above 1.40ish. Wait and see.

  • 575 Greg Atkinson // Mar 18, 2012 at 4:28 pm

    Plornt – well sometimes I am close to being right, not often but it does happen :) But the fall of the USD and the low interest rates in the U.S. flatter the Dow Jones a touch.

    Lachlan – glad you did well with AWE. That stock is on my radar all the time as it is basically a pure oil/gas play and the company is small enough to understand.

    I have been sitting on my hands for quite a while but I am slowly getting more active. Once we get the bad numbers out of China and things settle down I will be heading back into the fire.

    I am still expecting the All Ords/ASX 200 to take a hit down towards 4000 but after that I reckon a bull market run will take hold. A change of government would also help.

  • 576 Lachlan // Mar 18, 2012 at 4:55 pm

    Keep your share ideas coming Greg (and other commenter’s here). I had not looked at AWE properly for a few years (except to commiserate with a friend who bought much higher) but the fundamentals seemed fair and I liked the chart.
    Still have a buy on TLS below market, being a scrooge. If you are right about the indexes going to 4000 I may get lucky on that. They scraped themselves up and survived another retest of support last week, the break of which I hoped for.

  • 577 Plornt // Mar 19, 2012 at 8:50 am

    “Plornt I have noticed good entry points for some miners this week and some strong correlations in the class ie divergences and prices oversold on long term support. I will try to buy more.”

    I dont spend much time on shares/futures etc, so I haven’t been looking at much. I just basically set it up a few months ago and then just left it (apart from the switch to more Australian stocks after unloaded some US equities which was mainly to just increase my existing investments).

    Great to see the 30% gain on your AWE investment Lachlan; i missed out on that.
    NMG looks extremely bearish to me Lachlan. If you are buying at the 50% TA reversal method its already breached that ~52c which means there is now a high probability for a long term reversal to the breakout point 15-25c. I don’t like buying the 50% reversals as it fails more often than it holds (which happens for most Technical analysis hence why i dont base decisions from it). System shows downside risk is 22c, so that alligns with the TA, but there is not enough historical data for the system to be reliable. Again the system is just giving a statistically likely target.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change.

  • 578 Lachlan // Mar 19, 2012 at 9:04 am

    I only have a second to comment Plornt but I have bought SVL FML NCM today with 4 other bids out. I am setting up to take profits and reduce risk off a bounce here (if it materialises) in the hope of enjoying some trading and reducing cost basis. I am small position overall which ensures I won’t be too despondent if Shoes prediction of lower low comes about…and can hold out.
    I know what you are saying about NMG too. I have some other reasons… I can talk later. Cheers.

    These crazy ideas are not share tips or trading advice

  • 579 Lachlan // Mar 19, 2012 at 9:07 am

    NCM was a position increase the other two newbies. I know NCM is testing a support level too…once again some other reasons for later.

  • 580 Plornt // Mar 19, 2012 at 11:32 am

    “NCM was a position increase the other two newbies. I know NCM is testing a support level too…once again some other reasons for later.”

    I’m sure you’ll outperform the XAO Lachlan over the long term !

  • 581 Plornt // Mar 19, 2012 at 11:51 am

    Plornt // Feb 24, 2012 at 2:13 pm

    Qantas: Intrinsic Value 9.15$
    OST: Instrinsic Value: 4.2$
    Paperlinx: Instrinsic Value: 1.40$
    Bank of America: Instrinsic Value: 31$

    Qantas 24TH Feb 1.68; last close 1.765
    OST 24th Feb 1.025; last close 1.185
    PPX 24th Feb .10; last close .115
    BAC 24th Feb 7.88; last close 9.80
    Assume equal weight in each stock average gain is ~15%. Xao over same period is flat. Ourperformance 15%.

    These crazy ideas are not share tips or trading advice or investment advice :)

  • 582 Plornt // Mar 19, 2012 at 3:12 pm

    “Still have a buy on TLS below market, being a scrooge. If you are right about the indexes going to 4000 I may get lucky on that. They scraped themselves up and survived another retest of support last week, the break of which I hoped for.”

    Hope you manage to get a good price Lachlan on TLS. In terms of Australian small cap earnings which have been underwhelming; it’s tough out there for small business atm; I hope things pick up as they are so important to the Australian economy. We as investors donot want them to do poorly, or we all suffer. Earnings drive market returns obviously, so we all gotta start spending, and stop being so frugal and fearful ! Hopefully if the stock market rises substantially the wealth effect will take hold (i.e. feeling richer because of higher asset values) and that will promote further spending.

  • 583 Stillgotshoeson // Mar 19, 2012 at 3:26 pm

    NCM are down on the “Indonesian” fear of what is going to happen with new equity laws.

  • 584 Plornt // Mar 19, 2012 at 4:29 pm

    “NCM are down on the “Indonesian” fear of what is going to happen with new equity laws.”

    My hedging system gave a short target on NCM of 23 or 24$, from 34$ back in Decemeber; albeit its been extremely volatile it looks to have been spot on, but the major lows held ($29.51) from the close of last session, so that is one positive if it can find support here.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change.

  • 585 Lachlan // Mar 19, 2012 at 6:27 pm

    I finished the day also with SAR (additional shares to existing at 57c) and some FNT purchased at 9.9c. NCM @30.05, SVL@13c, FML @5c after trying for 4.7c and missing out. TLS are not filled with my bid too low so far.
    RE: NMG I like the fundamental case… not that the balance sheet can’t be better..it will if the production targets are made good (remembering miners are full of it ;) ). Thought they might scrape through my 46c buy zone intraday and close back up alas the capitulation to 40c has happened today. There is possible support there and also at 35c (35 = average of values in previous trade range). Regardless I am of the opinion they will have a date with at least 60c before the end of the year.
    I agree Plornt that NCM .. can.. technically move to support mid 20′s. They have a chance at 28.50 to bounce also. If they do go there it will give technicians something to talk about. It wont necessarily signal an end to the bull market but at best it will mean possibly a lot of hard work (consolidation) before a resumption. If it does and I see no change in fundamentals I would add on the dip.
    Gold shares are certainly poorly performing against the AUD gold price. That attracts me to them. They may then be viewed as cheap at least from that one angle. While there is no guarantee on anything let alone that they will ever catch up (re-correlate), you have to have some logical case for your decisions to give yourself some increased chances.
    Shoes I see FML’s risk is their cash costs. Black power is increasing African risk.
    Buy when there is blood..?

  • 586 Lachlan // Mar 19, 2012 at 6:29 pm

    ” Black power is increasing African risk.” re my African shares.

  • 587 Lachlan // Mar 19, 2012 at 6:32 pm

    None of my drivel above is to be taken as a share trading advice. For such advice please seek out someone with more apparent sanity/less desire for risk taking ;)

  • 588 Plornt // Mar 19, 2012 at 7:25 pm

    “None of my drivel above is to be taken as a share trading advice. For such advice please seek out someone with more apparent sanity/less desire for risk taking ”

    I think if people saw our sharpe ratios they would faint :P
    You lay a strong fundamental case for your stock – did your homework – and are emotionally prepared for volatility; which you have done successfully in the past.

    I’m off again for a few months. Don’t want to start being hyperactive on my positions, and create frictional costs. I’ll be back if something blows up ;).

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change.

  • 589 Plornt // Mar 19, 2012 at 7:58 pm

    Good luck; hope everyone is doing ok with their investments, and if not hoping that their returns will do great in the future !

  • 590 Stillgotshoeson // Mar 19, 2012 at 10:15 pm

    I bought 100000 GOR today at .325 Sovereign risks on our international plays are having some impact on those miners Lachlan. Might be my last addition to the portfolio for a while. A few dividend players are on the radar… Just not sure if I want in yet.
    Shoes Sydney.

  • 591 Plornt // Mar 20, 2012 at 5:52 am

    “I bought 100000 GOR today at .325 Sovereign risks on our international plays are having some impact on those miners Lachlan. Might be my last addition to the portfolio for a while. A few dividend players are on the radar… Just not sure if I want in yet.”

    Yes it’s better to just sit on your hands a lot of the time. Even Warren Buffett says this is the best approach. Just like in life being direct instead of passively agressively dribbing and destabalising people through others with bs, and incorrect assumptions.

    All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change.

  • 592 Plornt // Mar 20, 2012 at 6:09 am

    For those who want to follow Macro themes this is a great thread to visit:

    http://www.elitetrader.com/vb/showthread.php?s=a2dfff59674c2590f7fe0c672c7808f5&threadid=215992&perpage=6&pagenumber=534

  • 593 Greg Atkinson // Mar 20, 2012 at 8:03 am

    For me the big picture view is what I am focused on and now that is can a recovery in the U.S. economy compensate for a slowdown in China and probably years of sluggish growth. Or could the weaker global economy snuff out the recovery in the U.S?

    As readers of this site will know I am still waiting for the hit from China after which I hope we can get a better grip on how the global economy is really travelling. Hopefully this will indicate there is a world of growth without China surging and then the next bull market will finally get going.

  • 594 Lachlan // Mar 20, 2012 at 10:27 am

    “Sovereign risks on our international plays are having some impact on those miners Lachlan”
    It’s a bit of a worry Shoes. Real concerns make assets cheaper and one hopes the storm will blow over as they can do.

    “Don’t want to start being hyperactive on my positions, and create frictional costs.”
    Plornt I have incurred that problem by buying small positions in many places. Reducing risk has costs.

    Seems to be no end of risk in the headlines for the time being.

    Good luck fella’s.

  • 595 Plornt // Mar 20, 2012 at 11:10 am

    ““Don’t want to start being hyperactive on my positions, and create frictional costs.”
    Plornt I have incurred that problem by buying small positions in many places. Reducing risk has costs”

    Well I guess frictional costs in that sense is understandable. I’m sure its provided you some diversification, and better average costs if you haven’t bght many small things within the same sector/theme/industry etc.
    We just have to focus on results. Many people do not get decent returns, but seem to be knowledagble. I just focus on making sure my returns are good; without good results the rest is meaningless. And by good results I mean if your capital size is small you should be severely thrashing the index (20-30% p.a. above the benchmark index at least), as we have access to strategies that are not scaleable with much bigger capital sizes.

  • 596 Plornt // Mar 20, 2012 at 1:27 pm

    “Hopefully this will indicate there is a world of growth without China surging and then the next bull market will finally get going.”

    Its excrutiating to watch this XAO bull market breakout eventuate! I have not purchased anything for a while, as I can’t find anything below my intrnsic value method in terms of correct % discount.

  • 597 Plornt // Mar 23, 2012 at 10:24 am

    http://www.abc.net.au/news/2012-03-20/the-value-of-a-company-value-index/3902580?section=business

    Roger talks about the danger of US treasury bubble, and issues with investing in passive index funds in terms of company size, and not based on their ability to increase intrinsic value overtime. Great stuff.

  • 598 Stillgotshoeson // Mar 25, 2012 at 10:09 am

    IMF 7407 @ $1.455 $10777
    ABY 13000 @ $.72 $9360
    GRY* 8500 @ $1.09 $9265
    PRU* 3900 @ $2.35 $9165
    FML* 185000 @ $.05 $9250
    BPT* 7500 @ $1.625 $12187
    API 37700 @ $.27 $10179
    BKP 714000 @ $.015 $10710
    CTN 11000 @ $1.11 $12210
    EXS 30000 @$.185 $ 5500

    Shares $98603
    Cash $ 323

    Portfolio $98926

  • 599 Lachlan // Mar 25, 2012 at 2:03 pm

    Some continued technical weakness in gold shares has opened the way for further downside now Shoes (does not mean it will happen of course and we could get brief bounce first anyhow) but the fundamental case just gets better. Happy to hold but I am holding positions now which I can chisel profits from at resistance areas/price spikes.
    Happy I sold AWE. I thought it a great buy at the time and still might be but I have been unsure about the case for oil. There are reasonable cases for it being over priced/maybe overdone as an inflation hedge. If gold gets overpriced in fiat then nobody will starve which is a reason it is the best money money can buy ;).

  • 600 Stillgotshoeson // Mar 26, 2012 at 8:21 pm

    Europe is still a mess, I don’t believe the US has any sustainable growth happening at this point in time and our non mining economy is still in dullsville. Mining economy may take a breather too if the slowdown in China continues. Still can not see fundamental reasons for any significant rally in the ASX200 or All Ords, DOW is struggling to break 13000, though I still maintain what I said to Ross over on DRA a year or 2 back that the DOW could well hit 15000 and I would not be surprised to see it occur before it heads back lower than the recent low.

    Have as much exposure to the market as am comfortable with at this point, still hold the view it will test new lows during the continued “GFC”.

    Gold and Silver seem to have hit resistance levels and fluctuate little at this prices, looking for a signal to go one way or the other maybe?

  • 601 Lachlan // Mar 27, 2012 at 5:43 am

    DXY also at a decisive point of sorts.
    http://www.marketwatch.com/investing/index/DXY

  • 602 Greg Atkinson // Mar 28, 2012 at 12:29 pm

    Stillgotshoeson we are in the rather strange situation where stocks rally if they think there might be QE3 in the U.S. I say strange because another round of money printing would imply the economy in the U.S is not recovering so why stocks in Australia would rally because of this is beyond me.

    Looks to me as if the market at the moment is just blowing in the wind. It doesn’t take a lot to send shares up or down at the moment.

    Anyway I have posted my latest short term outlook for the Australian stock market here: Analysis of the Australian S&P/ASX 200 Index – March 2012

  • 603 Stillgotshoeson // Apr 10, 2012 at 11:40 am

    Bought 100000 more GOR @ .275
    and 600000 FML @.05

  • 604 Lachlan // Apr 10, 2012 at 4:53 pm

    I like the chart set up on GOR Shoes. They have sold down but the RSI is not validating it. It seems to me that the recent bearish action on goldies is really extending things to the downside. Some of my recent picks have lost a little ground when I thought they were ready pull up. It’s hard to believe we won’t see a good rally in progress before year end. I like FML at the 5c price too since I favour AUD gold prices holding here before pushing up again. Good luck.

  • 605 Stillgotshoeson // Apr 14, 2012 at 9:12 am

    GOR had a bit of press during the week Lachlan, seems they are at the point of deciding to continue explore and increase resource base or get a mill up and running to start processing ore to fund further exploration.

    Either way it seems later on there is probably going to be a capital raising in the future. Probably the last required.

    GOR is appealing to me as there time frame, in my reasoning, puts them well into the expected rise in the price of gold in the next 12 to 24 months.

    FML appeal as they are already producing, production is improving and there is promising results from treasure island. FML will consolidate share base at some point. 10:1, 15:1 or even 20:1 are possible. Maybe a re rating in to the ASX200 would be the catalyst for consolidation to occur.

  • 606 Lachlan // Apr 14, 2012 at 5:34 pm

    I am looking forward to a snap back in this share class Shoes. FML is classic one considering its price action of late. Yes they could go down more but fundamentally and technically they look like very decent odds to me. The flow of this market is slow and grinding though and its like a sideways suspended animation. It could keep this up a while to if we are doomed to such a torture. Either way my purchases are being held till they make a nominal gain.

    Do you know I fiddled around with RRL a few years ago in the 40 to 50c area eventually selling out for break even roughly. Had about 4-5K worth. They looked on the fundos’ to me to have had their run..I was wrong. Today they are between 4 and 5 dollars and like them technically for more upside yet. Rats eh.

    I have to build a decent cash reserve this year so won’t be buying much more but gladly I can get good interest and funds access. I will hit silver again if we go to lower lows eg 28 or 22. The long term chart (50yrs) looks very healthy for much much higher prices. Looking forward to the decisive break of 50 ie 65 or more

  • 607 Stillgotshoeson // Apr 15, 2012 at 10:25 am

    Rats is right :) Personally I do not imagine FML as a ten bagger into the future, you never know though.

    Full value for them I see at 27 cents pre any consolidation of the share base.

    Gold and Silver may still dip again but they still have much more upside yet.

    Robust and Industrea were two that I let go too soon. They both went on to be a better than ten bagger on my original purchase price.

    I still made a profit, around the 100% on both.

  • 608 Lachlan // Apr 16, 2012 at 1:34 pm

    I will be trading Focus by trimming at near term resistance and just watching the rest closely Shoes. Their outlook may change in time for better or worse. Now if only this share class can turn around.

  • 609 Stillgotshoeson // Apr 16, 2012 at 3:29 pm

    First upside resistance level I would put as 7 to 7.5, 9 to 9.5 will be another resistance level down the track. 12 to 15 will be the major test after that.

    Full value price of 27 would depend on them getting closer to a 300k/Oz production per year at a price over the $2000/Oz level.

    Not sure if I will trade them, might hold out for my original target of the 12 cent + region.

    Will depend on the market at that 7 to 7.5 cent level I think.

  • 610 Lachlan // Apr 16, 2012 at 5:43 pm

    A study of price shows that participants have supported the share nicely at around 4-4.5c and the action since the Oct 08 low has been bullish. Longer term the chart has been jammed in a declining wedge since an April 02 low. There may be an explosive run above 8-10c but I will trim a little there to reduce risk…if and when.

    Many metal shares are in deep support and nobody can say short term they will definitely go one way or another. I can only say for mine that a lot of risk is gone from the market and its time to start accumulating more seriously. Another leg down would be a signal to step up again and buy. Who can possibly say its time to sell? Is the market in a bubble, irrational exuberance, blow off top? The charts suggest metals shares are unpopular right now.

    This post does not constitute investment advice and the class of assets discussed are volatile and risky.

  • 611 Stillgotshoeson // Apr 20, 2012 at 7:26 pm

    A jump to 10 cent + might prompt me to sell half and move onto another stock and sit on the remainder.

    100k portfolio has had a stock sold and another added. updates tomorrow when I get a bit of time to sit down.

    Just got back to Melbourne. Spending about a third of my time in NSW at the moment.

    API sold CDY added

  • 612 Stillgotshoeson // Apr 22, 2012 at 9:59 am

    IMF 7407 @ $1.38 $10221
    ABY 13000 @ $.67 $8710
    GRY* 8500 @ $.99 $8415
    PRU* 3900 @ $2.52 $9828
    FML* 185000 @ $..049 $9065
    BPT* 7500 @ $1.43 $10725
    CDY 500000 $.02 $10020
    BKP 714000 @ $.015 $10710
    CTN 11000 @ $1.15.5 $12705
    EXS 30000 @$.177 $ 5310

    Shares $95709
    Cash $ 5194
    Portfolio $100903

    Sold API 37700 @ $.395 $14891
    Bought CDY 500000 $.02 $10020

  • 613 Greg Atkinson // May 12, 2012 at 10:05 am

    Despite the recent falls I am still sticking to my forecast for the ASX 200/All Ords for 2012 at this stage which I outlined in January: Australian stock market outlook & forecast for 2012

    This means I reckon the market will finish between 4800-5200 which will still leave us well below where we were just before the GFC.

  • 614 Stillgotshoeson // May 13, 2012 at 12:15 pm

    We are going to have falls and mini rallies for some time yet.

    IMF 7407 @ $1.43 $10592
    ABY 13000 @ $.55 $7150
    GRY* 8500 @ $.73 $6205
    PRU* 3900 @ $2.52 $9828
    FML* 300000 @ $.038 $11400
    BPT* 7500 @ $1.28 $9600
    CDY 500000 $.017 $8500
    BKP 714000 @ $.013 $9282
    CTN 11000 @ $1.10 $12100
    EXS 30000 @$.165 $ 4950

    Shares $89607
    Cash $ 805
    Portfolio $90412

    Bought 115000 FML at .038 $4390 Inc Brokerage.

  • 615 Greg Atkinson // May 31, 2012 at 9:37 am

    Today or tomorrow we are going to find out if the All Ords/ASX 200 can hold around the 4000 level. My view is they will hold around this point but it isn’t looking very good today.

    The economic crisis in Europe just keeps on going. The market bears are out in force but I still see the Australian market recovering later this year.

  • 616 Stillgotshoeson // Jun 10, 2012 at 2:19 pm

    IMF 7407 @ $1.32 $9777
    ABY 13000 @ $.47 $6110
    GRY* 8500 @ $.735 $6247
    PRU* 3900 @ $2.69 $10491
    FML* 300000 @ $.04 $12000
    BPT* 7500 @ $1.085 $8137
    CDY 500000 $.018 $9000
    BKP 714000 @ $.013 $9282
    CTN 11000 @ $.985 $10835
    EXS 30000 @$.17 $ 5100

    Shares $86979
    Cash $ 805
    Portfolio $87784

    Portfolio has slipped a little further.
    FML have had some good drill results recently, BKP have a drill onsite, hopefully some good results from them in the coming weeks.
    Have not had much time to monitor this or trade anything either.. Happy to just sit on this for now.

  • 617 Lachlan // Jun 15, 2012 at 7:13 am

    AWE are moving down nicely towards support area 1.25/1.45 (very roughly). The RSI could move somewhat lower or even diverge with price. I guess it’s prudent not to think too bullishly in a consolidating market.

  • 618 Lachlan // Jun 15, 2012 at 7:14 am

    Had some very nice drill results on GMR too Shoes. Very nice. Buy now and save ;)

  • 619 Lachlan // Jun 15, 2012 at 7:21 am

    Talking of Harvey Norman the chart looks pretty weak and I think it will drop off with another leg down on the ASX. Ol Harvey may want to lobby for more stimulating.

  • 620 Plornt // Jun 26, 2012 at 4:44 pm

    Lachlan how are you riding the rapids ? I think we could be headed off a waterfall.

    Something huge is comming to the downside. We may bounce temporarily, but I am very risk adverse right now.

    US markets are now in a confirmed bear market. DOW theory has called it; there are 4 x 6 red candles consecutively in pairs which is a gigantic worry. There is far too much complacency out there right now.

    It’s anaethma to me to be invested in anything. I’ve looked and many systems are calling for lower lows on many stocks and indexes. Far too much risk imo. For example my system says Qantas will bottom at 65c and Newcrest Mining at 12$. Fairfax 35c. It is like this for so many equities.
    Technically the market did so much damage when it crashed with such magnitude in such a short period of time. I never thought it would reverse with such velocity. Momentum is clearly down; you can’t crash like that, and just reverse suddenly.

    My statistical supports for the DJIA are 9,600 and 3,400 on the XA0, and if that fails 2,900. Worst case scenario are the 1995 lows of 2,000 if everything possible went wrong. Usually in MAJOR bear market lows you will hit 15+ year lows prior to a bottom.
    Silver and Gold look like they are about to crash severely. I’ve hedged my position. Is old Warren right again ? Greg called it correctly aswell.

    I think the Euro is about to collpase, or at the very least something serious is on the way that we cannot predict apart from using price action. System confirming 1.05 then possibly 80c.

    Australia is going to face a likely recession from a slowing housing market; China slowing (Europe provides Trillions of funding to emerging markets), and Mining bust. Australia hasn’t had a recession since 1991 which is highly unusual from a statistical standpoint, and could point to something huge, and deep. There is definitely enough catalysts out there to argue it.

    I just can’t see how equities will rise with multiple headwinds that have not yet fully developed.
    Any rallies should be sold heavily imo. This is not going to be pretty when it’s over. And we will rally at some point, but the trend is clearly down until price confirms otherwise.
    Have to play extremely good defence here.

  • 621 Plornt // Jun 26, 2012 at 5:25 pm

    “Today or tomorrow we are going to find out if the All Ords/ASX 200 can hold around the 4000 level. My view is they will hold around this point but it isn’t looking very good today.”

    XAO has held 4033 so far. Usually on intermediate bottoms it bounces 5-7% then reverses and retests the lows then bounces 7-10%. If it’s a bear market it will then reverse and crash through the lows, or it a bull market it would likely continue on. Failure to continue (which we experienced with the recent reversal of 10%+ suggests a bear market continuation to the downside. We also failed to breach the 700dma and the 700dma and 210dma have death crossed.
    Normally lows held for 6 months (i.e. not being below the lows at the 6mth date trigger, but allowed to be in between) + 20% crash below the 200 will result in a bullmarket, but this has been worringly breached. When a system does the opposite after a long period of success it doesn’t bode well that the market had enough selling pressure to render the trigger useless.

    The key thing to watch here is a technical system. 15td intraday lows above the 10dma + a >20% crash from the 6 month highs + below the 200dma will always give rise to a major bull market.
    There is just nothing to suggest a bullmarket is here.

  • 622 BP // Jun 26, 2012 at 8:36 pm

    Plornt: “Australia is going to face a likely recession from a slowing housing market; China slowing (Europe provides Trillions of funding to emerging markets), and Mining bust. Australia hasn’t had a recession since 1991 which is highly unusual from a statistical standpoint, and could point to something huge, and deep. There is definitely enough catalysts out there to argue it.”

    Yet our _banks_ have been rated the best in the world, for the second time-in-a-row… . Hardly a hiding!~ :D

  • 623 Lachlan // Jun 26, 2012 at 9:29 pm

    Hi Plornt. Actually my gold stocks have been the hardest hit sector. Clearly out of favour. My play there is to make sure and buy some more a good deal lower again if possible.

    Anyhow think I know where you are technically coming from. XJO has made a short term megaphone which looks compelling to 3600. Would not short term trade this stuff however, it’s all too hard to play esp now. Obvious set ups are dangerous. I would agree the obvious technical call is bearish right now. I made that clear to Greg a few weeks ago. I said we would sell to 3900 and bounce to 4150/4200 and possibly capitulate to 3800 and maybe 3600 (approx’s). Some of that as played out already. We’ll see. Amusing markets at any rate.

  • 624 Plornt // Jun 26, 2012 at 10:32 pm

    “Anyhow think I know where you are technically coming from. XJO has made a short term megaphone which looks compelling to 3600. Would not short term trade this stuff however, it’s all too hard to play esp now. Obvious set ups are dangerous. I would agree the obvious technical call is bearish right now.”

    Just have to wait and watch on how this Europe mess unwinds. All coming home to roost.
    I am looking to short DJIA and Silver, but currently not sure about entries, and associated stops. Trying to resist the urge to short a rising market; made that mistakes many times ! If I get accidentally caught in any unintended overlapping associated obvious setups my multiple stops will take me out without much damage (<2% at risk which is standard).

  • 625 Lachlan // Jun 27, 2012 at 6:41 am

    It is a thrill to trade. I do not have the time,tools and the commitment for it and that was a choice. My business relies on seasons the last two of which have been unreal and looks good to continue so I made a decision not to invest any more time and resources in trading two years ago. Just going for the earn money and invest long term strategy. I do love all this financial and political real time drama though….luck we have the net.
    NMG and and NCM came off too just as you said btw. I knew there was a classic technical case for breakdown there but believed wrongly the market was about to shake-out on a fake-out so to speak. I bought more NMG after it collapsed and it still looks weak. Anyhow I have no qualms holding shares in gold in these conditions. Will just have to see if I get a chance to buy more since I have demands on my cash for my business this year.
    Longer term it seems Europe has evolved into the deflationary event that will shake out the market before the next phase, the USA which will be the inflationary event. Or so I judge it to be.

  • 626 Lachlan // Jun 27, 2012 at 7:06 am

    Granted Plornt I have the urge to trade in a stock now and then if things favour that but none of the leveraged games for me. Sounds like you have all the tools you need there to do your stuff with access to various instruments and markets across the world. Sounds like fun actually. Maybe I can play again when these good seasons pass and I am retired on my seed harvests like a good little worker ant. Maybe I could buy a few consoles and some good services for monitoring. Who knows. Get in the ring with the boys on WS.

    I do think the dollar index is readying for a zippy ride up. If so it remains to be seen which markets go up with it and which sink. I think silver is a possibility to diverge downward against a rising gold. Possible anyhow.

  • 627 Plornt // Jun 27, 2012 at 7:45 am

    “I made a decision not to invest any more time and resources in trading two years ago.”

    The key is to stick to your strengths; don’t try and mimic anyone, and do what suits your personality, intellect and ability. There is no shame in admiting you are not good at something.

    I am glad you have found something you are good at and find enjoyable in spending more time doing. I don’t spent very much time trading, and 99% of my trading profits come from futures. I found myself hopeless and unprofitable at trading stocks and options.

    “NMG and and NCM came off too just as you said btw. I knew there was a classic technical case for breakdown there but believed wrongly the market was about to shake-out on a fake-out so to speak. I bought more NMG after it collapsed and it still looks weak. Anyhow I have no qualms holding shares in gold in these conditions. Will just have to see if I get a chance to buy more since I have demands on my cash for my business this year.”

    Yes NMG has gone back to the breakout point as it went through the 50% level. I am not sure if it’s bottomed here it may slowly drift down to 10-15c, but obviously most of the damage has been done. The rest is capitulation risk to shake out the long term holders before a very big upswing back to the 50% level perhaps. I am sure you have the patience to stay with it, and add near the lows when you confirm them. Don’t have any systems to determine where price is likely to go.

    “I do think the dollar index is readying for a zippy ride up.’

    That was my first thoughts too. My original system on the UUP (DX ETF) last year said it would peak at 23.5, so there doesn’t seem to be a lot of upside now unless I can find another system to justify another rise. I think I saw an elliot wave thesis of a sustained bullish wave count for the DX, but I really donot understand EW, so I will leave it at that.

    Intuitively I suspect a lower low rolling correction of the DJIA. Lots of volatility where people become more and more unsure as to direction.

  • 628 Plornt // Jun 27, 2012 at 7:53 am

    My 100 year returns system is predicting 9,000 on the DJIA by December 31st. This has been pretty reliable in the past couple of years, but it doesn’t seem realistic that the DJIA could fall that far looking at the charts subjectively. That said it is obviously very bearish from a technical standpoint. Almost everyone can see what is coming here which is common for major reversals. Lots of text book setups usually occur.

  • 629 Stillgotshoeson // Jun 27, 2012 at 3:14 pm

    I still maintain my view of a xub 3000 ASX before this is all over, some stocks are still stay away, some I am happy to accumulate on dips. Fundamental reasons for buying SIlver Bullion and Gold Mining companies is still sound, absolute bottom can not be picked so I add to portfolio on dips. Dollar cost averaging.

    Some States/sectors of the Australian economy are already in recession, recessionarclimate is set to continue.

    My best investment over the last couple of years has been the coffee shop. :)
    We are thinking of getting another one.

    Not yet 45 and still aiming for retirement by 50. If the current economic blip makes it 53, so be it. I have had a promotion and a 50% pay rise over the last year so current downturn in tha market does not bother me, will continue to hold through this and add to the portfolio stocks that reach attractive levels.

    More money printing in the US may push your systems call for 9000 on the DOW out to next year Plornt. Same with our ASX, I am not going to try and bet against the trend at this stage and the trend is still down.

  • 630 Plornt // Jun 27, 2012 at 4:44 pm

    “I still maintain my view of a xub 3000 ASX before this is all over, some stocks are still stay away, some I am happy to accumulate on dips.”

    Take a look at the Quarterly charts of the XAO Still. There is clearly a 6 red candle reversal there which is not great for long term buying. There could be a high risk 3,000 will breach – which you mentioned – and usually when you have a 6 red candle reversal it will go the distance below the 6th candle from the 1st to 6th (and sometimes multiples of the distance for daily time frames). Although this setup is widely recognised, so it won’t likely go down that far. If you look at the n225 (Nikkei) that also had a 6 candle reversal, a small bounce, and then made new lows prior to a sustained bull market.
    XAO should bounce 8-9% here before going into the next downleg imo.

    Silver on the quarterly clearly shows the 9 blue candle blowoff, but setups like that usually mean new highs will eventually occur, but it could be a while obviously. 18-20$ for silver looks likely but I don’t have a system entry for it yet.

  • 631 Plornt // Jun 27, 2012 at 4:56 pm

    The DJIA has a 6 candle reversal on the Quarterly. The amount of air under that market !!! If the 6 red candle pattern was effective that would mean DJIA under 5,000 ? Heads and shoulders pattern on the long term daily charts.

  • 632 Greg Atkinson // Jun 27, 2012 at 5:00 pm

    Well my view is the ASX All Ords/ASX 200 has been trading at a recession-like level already for years. The mining related stocks have also taken a hit over the last few months so I reckon most of the damage has been done.

    Remember we are effectively back to 2005. The mining boom has been basically wiped off the stock market & it’s almost like it never happened.

    I reckon we should be at around 4800-5200 – 10% because of the carbon tax, MRRT & politcal mess which brings it down to say 4400.

    So why are we lower? Europe + the fear of a major China slowdown.

    Of course I am counting on the Europeans sorting themselves out which is probably a big mistake :)

  • 633 Ned S // Jun 28, 2012 at 12:00 am

    Greg: “Of course I am counting on the Europeans sorting themselves out which is probably a big mistake :)”

    The whole system’s effed – I trust noone (except my mum – and my dad sometimes :)):

    http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9359362/Bob-Diamond-forgoes-bonus-as-Barclays-fined-for-Libor-manipulation.html

  • 634 Greg Atkinson // Jun 28, 2012 at 2:34 pm

    Ned are you trying to cheer me up? ;) It does seem a mess & one reason perhaps is that some banks are too big? Maybe there is a role for, dare I say it, a government/controlled owned bank or banks?

    The All Ords/ASX 200 are trying to hang on above 4000 again today. That is sort of good news but I am starting to wonder how long the market can hold at this level with so much bad news swirling around.

  • 635 Ned S // Jun 28, 2012 at 4:40 pm

    If I told you what I really think, I doubt it would cheer you up Greg … :)

    That said, stocks have already been hammered so for those who do understand investing in them (which ain’t me), so I expect they are as good (or bad?) a place to be as anything much else.

    The Europeans are having another supposedly significant talkfest this Friday I gather? (Haven’t really been keeping up to date with things of late what with having gone back to work.)

  • 636 BP // Jun 28, 2012 at 4:46 pm

    GA: “…so much bad news swirling around…”

    Every cloud has a silver lining, fellas!
    Be glad we’re not Europe or the US…

  • 637 Ned S // Jun 28, 2012 at 6:05 pm

    There’s a lot of interesting stuff happening in the world Biker with the future simply not looking great at all for Socialist live above one’s income type developed Western democracies with lots of (pretty stupid) poor unhealthy old people and lots of (pretty stupid) high expectation lazy young people for them to support.

  • 638 BP // Jun 28, 2012 at 11:22 pm

    Ned: “…lots of (pretty stupid) poor unhealthy old people and lots of (pretty stupid) high expectation lazy young people for them to support.”

    The way I read it these days, Ned, is that the _really_ stupid younger folk resent the ‘poor unhealthy old people’ and the ‘wealthy healthy ‘old’ people’ without discriminating between them.

    Rational Australians of any age bear no generation ill will… and if you have your health, you have everything!~

    And I still believe that there’s gold in them ‘ills. ;)

  • 639 Ned S // Jun 29, 2012 at 7:29 am

    Being back in the workforce has exposed me to working Aussies’ attitudes and competence levels – And I’m fairly disappointed in both. Talk to Aussies (or migrants from developed countries – Ireland being an exception Shoes – IME anyway) and they tell you how bad it is that they have to work really hard to get ahead; Talk to migrants from the likes of India and South Africa and they tell you how good it is that they can work really hard and get ahead.

    Oz share pices? Dunno??? But I do think we’ve got labour force issues that MUST be impacting them? (And don’t blame Gina Rinehart for wanting to bring in lots of migrants.)

    And broadly speaking, it seems the entire developed world has ‘expectation’ issues that will also make it extremely difficult to compete globally going forward? Which I’m not seeing generally recognised. Rather, I’m seeing things like the West complaining about the likes of China manipulating their currency for competitive advantage; But then running to them cap in hand for bailout money so they can continue to live way better than the average Chinese does anyway?

    The world has become seriously strange!

    And for anyone who reckons the West can and will compete by being ‘smarter’, I just reckon they need to take a good hard look at the West’s last great innovation – Pumping the world full of debt. Because the last time I looked the result was that the US’ share of global GDP had dropped from 24% to 19%; With a recent prediction being that China will overtake the US as the world’s largest economy by 2017.

    That’s potentially good for Oz generally and it’s share market prices specifically though maybe?

  • 640 Plornt // Jun 29, 2012 at 8:49 am

    Time to work on risk management guys for the ensuing issues over the next few months (after any overdue temporary relief rally to suck in everyone again)!
    If your risk management is poor there will be massive issues.

    You can have the WORST setups, and have the worst timing, but if your risk management is superior you will survive ! Statistical duration, mutli tranche exits (core, blue sky, breakeven). Fixed fractional trading will kill you after consecutive losses. Have to cut size (or decrease or increase entries/exits long/short) when you are doing poorly; most people will continue to add to losers thinking their luck has just about changed. 3x standard deviation mth losses for max draw.

    Can’t believe we have to just survive. Markets take no prisoners, or anyone that is overconfident.
    Am 90% cash atm, and worried !!

    I’ve found that bear markets tend to correlate with other bear markets historically at times. Atm there appears to be a very strong correlation between the Sep 6 1989 – Jan 17 1991 XAO bearmarket and from the peak set last year. If that correlation holds we have 5 months until the lows which would indicate the seasonal bottom of October could be setting up for a value trap, and we would bottom in November. Also the GFC lows could be a value trap as many people are eyeing those major lows.

  • 641 BP // Jun 29, 2012 at 9:16 am

    Ned: “Talk to migrants from the likes of India and South Africa and they tell you how good it is that they can work really hard and get ahead.”

    There are a few other nationalities you can include in that list, Ned. Completely and utterly agree!~ :D

    And your comment re. “…migrants from developed countries… tell you how bad it is that they have to work really hard to get ahead…” is also spot-on. Remember most are fleeing from once prosperous economies. Many no doubt expected to quickly convert their losses to gains on the imagined back of a much-vaunted property collapse.

    Interesting that the major parties agree that we should increase our migrant intake:

    http://www.watoday.com.au/opinion/politics/hard-figures-back-case-to-open-gates-20120628-2156z.html

  • 642 Stillgotshoeson // Jul 1, 2012 at 1:28 pm

    Updated Portfolio Standing..

    NB: No deletions all still here ;)

    SBM 6100 @ $1.77 $10797
    ABY 13000 @ $.47 $6110
    GRY* 8500 @ $.68 $5780
    PRU* 3900 @ $2.48 $9672
    FML* 300000 @ $.037 $11100
    BPT* 7500 @ $.94 $7050
    CDY 500000 $.016 $8000
    BKP 714000 @ $.013 $9282
    EVN 7370 @ $1.475 $10871
    EXS 30000 @$.16 $4800

    Shares $83462
    Cash $ 821
    Portfolio $84283

    Sold IMF 7407 @ $1.46 $10814
    Sold CTN CTN 11000 @ $.99 $10890

    Bought SBM 10797 @ $1.77
    Bought EVN 7370 @ $1.475

  • 643 Ned S // Jul 1, 2012 at 4:07 pm

    If this rally lasts past Tuesday then I’m going to have change my name to “Dutchie” … :) :

    http://money.msn.com/top-stocks/post.aspx?post=2cd25f53-ad4c-4e73-bd5a-eb17c043ad65

    http://www.telegraph.co.uk/finance/comment/liamhalligan/9366983/Italy-has-won-this-euro-battle-but-not-the-war.html

    http://www.independent.co.uk/news/business/comment/satyajit-das-germany-might-not-be-strong-enough-to-save-euro-strugglers-7866603.html

  • 644 Ned S // Jul 2, 2012 at 9:58 am

    2013 is when the proverbial hits the fan in Europe according to this:

    http://www.telegraph.co.uk/finance/economics/9368654/Europes-bad-debts-will-bite-in-2013.html

  • 645 Plornt // Jul 2, 2012 at 10:54 am

    Ned whichever year it comes, and I am betting this year (and it could even flow into next year as that article has mentioned) it’s not going to be pretty. This crash will be an Ireland type fall as it will have the housing market + Australian recession + Mining bust + Europe issues pushing it lower. I don’t see how our market can not crash severely with that many potential issues.
    If anyone can figure out the probability of a recession given ~20+ years without one, and how severe recession cycles are after such a prolonged time without one that would be interesting.

    If any of our banks get into severe bad debt trouble with our housing market then given the weight in our index the index could fall severely and bring down everything with it. It would be EXTREMELY DIFFICULT to be able to generate positive returns in stocks without taking on HUGE RISK OF RUIN. I’m sure the best fund managers can do it, but it’s definitely not the time for us casual amateurs to be trying to be do the impossible.

    Defensive stocks don’t always save you in a bear market with a housing bust (and mining bust). Everything gets hit. I’ve been through the GFC, and so many people were getting slaughtered in defensives; quality stocks everything. There is really no hiding place in a structural bear market. What we have gone through in crashes is not even remotely close to the GFC. I think we are going to get something more severe than the GFC this time because we simply did not pop the housing bubble in the last bear market cycle, and obviously did not have China mining bust issues.

    1 Markets usually start of with a severe a rapid fall. The junk stocks, and high beta stocks usually fall severely appearing to look “cheap.”

    2 People get caught buying into what they think is a bottom. Investors move into quality issues thinking they are safe havens. Quality stocks hold their value whilst the high beta stocks begin another fall to knew lows (canary in the coal mine).

    3 Stocks move sideways, and everyone begins to get confused with direction. Bulls and bears fight it out, moves become highly volatile in either direction as good and bad news occurs. This is the stage we are in now with Europe.

    4 Eventually the bad news cannot be ignored and reality sets in. Markets crash, and everything goes down. People begin panic selling their worst stocks and it expidites the buying into quality.

    5 Markets continue to fall and quality stocks begin playing catchup to the poor quality issues, and continue to crash. Quality stocks begin bottoming out, and long term investors begin to sell, and move to cash.

    6 Bear market lows are in; investors are now heavily in cash. Market cycle restarts (within a secular bear market which mean the bull cycle is 2 years at most). Move upwards starts, and during the first 30% of the move people are proclaiming that the really is just a bounce, and that new lows are coming. Everyone is cautious, and fearful into the rise.

  • 646 Ned S // Jul 2, 2012 at 3:30 pm

    This is unscientific enough that it should be good for a laugh for anyone who feels so inclined …

    My Russian “canary in the coal mine” dropped dead last night – Detail follows:

    * Russian friend was all over the Bear Stearns thing back before Lehmans blew and screaming big problems ahead

    * Same Russian has been steady as a rock since – “Yep, the world has problems but things could/should be OK”

    * Last night – “I’m frightened!”

  • 647 Greg Atkinson // Jul 2, 2012 at 6:50 pm

    Well the fall in commodities prices is actually going to help many economies recover so all may not be lost. Perhaps we are set for Europe & the U.S. to muddle their way through own ‘Lost Decade’ which will probably just send more business across to Asia.

    Banking is one area for example where Asian banks are coming in to take up the slack after European & U.S have scaled back operations.

    As for the Australian stock market, I still think we will see it rally off the level it is bouncing around now but I doubt 2012 is going to be a stellar year….unfortunately.

  • 648 BP // Jul 2, 2012 at 7:25 pm

    Plornt: “I’ve been through the GFC…”

    That should stand you in good stead.

    Plornt: “6 Bear market lows are in; investors are now heavily in cash.”

    I can see you’re already ahead of the pack:

    Plornt: “Am 90% cash atm, and worried !!”

    Why worry? Always wanted my own cash machine… .

    Seriously, for those heavily into major cash who believe the sky is about to fall, you should be jumping-for-joy. You’ll jump the queues and be able to buy all the good bits of blue stuff cheaply! The only time you’d need to worry would be if:

    * Rents are rising

    * Population is rising

    * Rates are falling

    * Super becomes unattractive

    * Residential construction is slowing

    * House prices are rising…

    No chance of any of that at present!~

  • 649 Ned S // Jul 2, 2012 at 7:27 pm

    Greg: “Well the fall in commodities prices is actually going to help many economies recover so all may not be lost.”

    Oil holding around USD 80 a barrel can’t be a bad thing in that regard Greg. (Unless one is a Russian maybe? :))

  • 650 BP // Jul 4, 2012 at 10:25 am

    Another view, Ned:

    http://www.perthnow.com.au/business/commodity-prices-to-recover-this-year/story-e6frg2r3-1226416491315

    If it’s correct, Greg’s prediction might be on track… .

  • 651 Greg Atkinson // Jul 4, 2012 at 12:33 pm

    Ned an oil price around $80 is a lot better that $150 that’s for sure. You might remember that some analysts once said oil was sure to reach $200 USD a barrel. That was back in 2007 and actually oil got closer to $20 a barrel than $200.

    Anyway I am hoping the Australian stock market will get a lift simply because I feel it’s been oversold and not because I expect commodities prices to stage a major recovery.

    Of course the Europeans could spoil everything..or the Americans..or the Chinese…

  • 652 Leigh // Jul 19, 2012 at 4:15 pm

    Well Greg it seems we got that “lift” today let’s hope it lasts at least until tomorrow. However, taking a twenty share sample, including banks, BHP, STO,TLS,WES and WOW I figure we are still about 30% down from the highs of 07 even though we are up 50% from the lows of 09. Oddly, BHP is now lower than it was in 09. $31.30 in Aug 2009, today its $31.10 yet we were having a mining boom all that time. CBA on the other hand was worth $25 in 09 and is now worth $55.90. One of the few shares to have beaten its 07 high point is APA, was $4.35 now $5.08 and before we get too excited about Telstra’s recovery it was about a dollar dearer 5 years ago.
    Regardless of the complexities it is good to see a solid gain, but can the profit takers sit on their hands for a week or so?

  • 653 Greg Atkinson // Jul 19, 2012 at 5:03 pm

    Lachlan I find it hard to get too excited when I realise we are still sitting at around 4200 on the All Ords/ASX 200. I do regret however not buying into Telstra when they were around $3.00! Perhaps the the profit takers might move in tomorrow?

  • 654 Lachlan // Jul 19, 2012 at 9:04 pm

    ” I do regret however not buying into Telstra when they were around $3.00″

    I got that one wrong too Greg. That would have been a bright spot in my portfolio by now. TLS and some other dividend shares I have watched have all tracked slightly upward while commods are sold off. Will just have to see if the usdx breaks toward 88 and shakes the market out or if we are just going to muddle sideways more before finally lurching back up. If we spike down hard I think it will be created by a EZ crisis which will be addressed in some can kicking way and then followed by a new narrative in the financial media, emphasis on the US and resumption of the dollar short trade.

  • 655 Plornt // Jul 26, 2012 at 11:04 pm

    Flash type crash – DJIA – is imminent imo.

  • 656 Stillgotshoeson // Jul 28, 2012 at 2:24 pm

    SBM 6100 @ $1.43 $8723
    ABY 13000 @ $.43 $5590
    GRY* 8500 @ $.67 $5695
    PRU* 3900 @ $2.26 $8814
    FML* 300000 @ $.037 $11100
    BPT* 7500 @ $1.095 $8212
    CDY 500000 $.016 $8000
    BKP 714000 @ $.014 $9996
    EVN 7370 @ $1.56 $11497
    EXS 30000 @$.15 $4500
    PIO 5000 @.022 $1150

    Bought 50000 PIO @.022

    12/06/12
    Dividend ABY @ 5 cps
    $650

    Shares $83277
    Cash $ 351
    Portfolio $83628

  • 657 BP // Jul 28, 2012 at 3:00 pm

    PIO? Could be cheap at .022.

    You were paying a lot more for them thirty months ago:

    Shoes: “Have an order for 130000 PIO @ 3.8cents
    As high as I am prepared to pay.”

    And I recall another contributor _thanking_ you for that advice. ;)

  • 658 Plornt // Jul 28, 2012 at 6:08 pm

    http://1.bp.blogspot.com/-gsyaRT-lCCY/T7fE2nDUSxI/AAAAAAAABwY/6LOWrHzdkjg/s1600/siy00-monthly-wavecount.png

    Silver 30 year double top. Doesnt bode well short to intermediate term. Will keep my static hedge on awhile. We do know double tops usually get broken long term. Some people are predicting a crash back to the base of 8$ — some 18-20$. Truth is we dont know but the trend is clearly down.

    HISTORICAL BEAR MARKET CYCLES – DJIA.
    Av Annual Real Returns Inflation Spike
    1967-1982 -3.80% 24.00%
    1930-1949 -1.80% 17.00%
    1903-1921 -4.40% 25.00%
    *without dividends reinvested

    In the last 110 years all 3 major bear markets recorded an inflation spike of at least 17%. Granted the world was different back then but it would be interesting to know what would happen to interest rates and commodities IF this cycle repeats again during this bear market. Some of the early price action is repeating aswell (i.e. there was lowering of interest rates first followed by a massive spike in interest rates).

  • 659 BP // Jul 29, 2012 at 9:13 am

    Plornt: “…followed by a massive spike in interest rates…”

    It’s difficult to see any direct correlation between the Hunt Bros fiasco of the late 70s and silver’s price today, to interest rates surging in the near future. That said, in a scenario in which global economic conditions improved, PMs might return to a level Ned once theorised as cost of production plus 50%…

    A ‘massive spike in interest rates’ seems unlikely. While a return to confidence any major improvement in global economic conditions might inspire, a ‘massive’ rise in rates would likely plunge markets (of all kinds) back into the doldrums.

    But your position on rates in recent posts, has been very negative, to say the least. As recently as 29th June 2012, you stated: “Am 90% cash atm, and worried !!”

    If you’re 90% cash in June 2012 and by July 2012 you’re expecting a ‘massive spike in interest rates’, why are you worried? You should be partying… . ;)

  • 660 Plornt // Jul 29, 2012 at 11:45 am

    “If you’re 90% cash in June 2012 and by July 2012 you’re expecting a ‘massive spike in interest rates’, why are you worried? You should be partying… .“

    All im saying is that there have been massive inflation spikes during every US major bear market cycle (in almost every developed economy) since 1900. It doesnt guarantee interest rate spikes but one would wonder how interest rates would respond if you have this cycle repeat. Things change but cycles do tend to repeat. Certainly interest rates in Australia will clearly trend down first until this housing bubble is worked off. We are still at ~7x average income. Clearly some smart chaps are finding gems in the midst of the fall but I am not smart enough to do this.
    Either median house prices have to fall or wages will have to signifcantly rise. The time frame for this possible interest rate spike could be up to 5-10 years. I cannot predict when inflation will spike during the secular bear. All I know is that in the last 110 years it has done so every time. I also mentioned last year that Australian bonds 10 year looked like rates were going higher AFTER any interest rate retracement back to the base.

    “A ‘massive spike in interest rates’ seems unlikely. While a return to confidence any major improvement in global economic conditions might inspire, a ‘massive’ rise in rates would likely plunge markets (of all kinds) back into the doldrums.“

    Rates can rise significantly without the economy improving or major confidence returning. Check back further than your lifetime – 100-150 years and analyse each cycle and you will see what I mean. It is never different this time.

    I am no longer fully in cash. Am short 250% with max portfolio risk of 5%. As I stated in previous posts I was waiting to go on the short side after any significant rally which has transpired. More leverage doesnt always mean more risk. Infact I feel i can control my risk a lot better with futures and forex than I can with equities – I am poor at equities – Equities will drawdown 4-5x more than futures if managed properly and futures returns better. I never had a losing year in forex or futures in 3 years. Well this is just my experience – maybe I am bias. If you are poor at market timing and very static with your positioning and thought processes then I would avoid futures as you will blow up your account at some stage. Giving wide stops or investing in futures is a recipe for disaster. If you feel the need to be correct all the time then I would definitely avoid futures as you are certain to blow your account up.

    “ion between the Hunt Bros fiasco of the late 70s and silver’s price today, to interest rates surging in the near future. That said, in a scenario in which global economic conditions improved, PMs might return to a level Ned once theorised as cost of production plus 50%…“

    I never said there was a correlation I was just pointing out a common simple technical double top setup. Circumstances are obviously different and silver is well below inflation adjusted highs still. I will hold my silver for the entire duration of the bear cycle. Want to be there IF inflation spiked again and the cycle repeated.

    This post does not constitute investment or trading advice and the class of assets discussed are volatile and risky.

  • 661 Plornt // Jul 29, 2012 at 12:29 pm

    ”Rats is right Personally I do not imagine FML as a ten bagger into the future, you never know though.

    Full value for them I see at 27 cents pre any consolidation of the share base.

    Gold and Silver may still dip again but they still have much more upside yet.

    Robust and Industrea were two that I let go too soon. They both went on to be a better than ten bagger on my original purchase price.

    I still made a profit, around the 100% on both.”

    Wow 100% into 10 baggers. I have only been trading futures and fx since late 2009 and had many that would go on aswell. It doesnt matter as long as your average win > av loss and your account equity to drawdown is > 1.5 > 1. Do those things consistently and the rest will take care of itself.
    Have been trading equities since 2008 but still cant figure out how people get returns. It has been unproftitable for me – hopeless at it. I guess you need to have more of a background in business in order for you to have a better chance to beat the index. Or EXTREME patience like Greg or leigh have. Or EXTREME optimism like BP has. Psychologically I am not cut out for it. Have a low tolerance for pain so sticking with a fundamental plan when price is doing the opposite is anathema to me.

  • 662 BP // Jul 29, 2012 at 12:29 pm

    Having just returned from Singapore, I think our property markets can bear 7X average income, Plornt:

    http://www.channelnewsasia.com/stories/singaporelocalnews/view/1182869/1/.html

    The average wage of Singaporeans is around a third of ours, but most of the ‘homes’ we saw for sale were in the region of S$360K to S$770K. That’s 14X – 31X average wages. Rents were around S$25K – S$45K pa, even for HDBs.

    I won’t be the first or last to remind you that Aussie DINKs can easily bear 7X average income; and generous leave provisions mean that women, often earning more than their partners these days, may continue to earn through their child-bearing years.

    Ultimately rents as well as rates may determine how high house prices go in Australia. As far as interest rates rising, your comment: “Check back further than your lifetime — 100-150 years and analyse each cycle and you will see what I mean. It is never different this time…”

    That’s an interesting timeframe you offer. Remember that you yourself state (658, above): “Granted the world was different back then…” So is it “different”, or is it “never different”?

  • 663 Plornt // Jul 29, 2012 at 3:02 pm

    BEAR CASE

    *Major crashes occur every 4-5 years – we are in year 4. During secular bear markets there is a high likelihood of rolling multiple 20-30% corrections prior to a bottom. The fact the first major crashes have occured in the DJIA and XAO have increased the likelihood that the 2nd XAO correction is looming. The DJIA failed to correct more than 20% on the first crash – followed by new highs – which increases the chance there are 2 more 20-30% corrections to potentially occur (i.e. another GFC type scenario). There are obvious catalysts currently to trigger such a scenario. Citigroup just said there is a 90% chance Greece leaves the Euro. I have 12 month targets on the Euro of 90 so there is a lot more potential downside.
    *Only 5-10% of market participants can actually generate positive returns through long equities during a bear market crash.
    *Sentiment indicators are at extremes which is a bearish sign as in these conditions they will arguably worsen as participants do what worked during normal conditions and then begin panicing as it goes outside normal variance.
    *Big speculators in the COT report are heavily betting on continued USD strength which can only hinder equity returns. This has been a reliable indicator at extremes.
    *Its human nature to naturally do the opposite of the main trend and the main trend is clearly down after the technical damage sustained in 2011 and 2012 (i.e. fade the trend). If you backtest many systems you will see a pattern of expensive getting more expensive and cheaper getting cheaper over the prevailing 6-12 months. This is obviously irrelevant for 5 year timeframes in which contrarian buying probably works best but most puke at the lows as their positions may drop 40-50% prior to a sustained reversal. You may see overconfidence because of their robust valuation skills and analysis followed by doubt creeping in as their positions violently move against them. Extreme patience and pain tolerance and ability to handle 50%+ temporary volatility makes this an irrelevant consideration for long term holders. Drawdowns may last 12-18 months in a proper bear market with no sustained relief rally.
    *Many high quality companies are becoming overpriced. Major market bottoms usually contain many high quality issues as they are the last to go as participants sell quality looking for liquidity as they protect capital and let losses run.
    *There is a flight to high dividend yield stocks.
    *The Euro situation is worsening and is basically lehman on steroids. The DJIA is arguably not discounting the Europe situation adequately.
    *Fund managers in aggregate are chasing performance because investors redemptions are rising and to make up poor performance in 2011. If markets worsen – even if they end up being right – unless they have sticky capital they are going to be selling at the lows to fund redemptions. Public are extremely worried and any further weakening of the Europe situation – which is a high probability situation – will create mass panic. I am not seeing ANY panic yet. I am seeing people being risk adverse (i.e. going into high dividend yield stocks and staying in quality companies – hence the massive outflows from poor quality into high quality issues thus eventually compounding your losses when the high quality mean reverts).
    *long term participants thinking the doomers are stupid. Saw this in early 2008 and the market continued to sink another 30-40%.
    *China slowing
    *US GDP 1.5% 2nd qtr slowing
    *US earnings estimates thus far for 3rd qtr are underwhelming yet predicting growth in the 4th qtr.
    *Participants are expecting oscillating sentiment and ranges which my systems are now showing sustained 6-12 month downtrends. Market is oscillating because its moving from a sustained uptrend to a new downtrend. High volatility at turning points.

    BUll CASE

    *Poor companies are already reasonably priced and pricing in a disaster scenario.
    *A bullish XAO system has fired (with 15% max stat drawdown) last week – whilst 13 short systems have fired in the last week and several next month. We know the last time I had a long term bull system fire it failed miserably which is common prior to massive bear market declines (i.e. a reliable bull system fired in May 2008). When a reliable system fails there is a high likelihood the market is going to reverse heavily in the opposing direction for a sustained period.
    *The overall market is bearish and cautious which is a contrarian indicator to go long. The question is how extreme and sustained does the bearishness need to be prior to it being a reliable indicator.
    *The olympic effect (even though if you back test the XAO some samples had significantly negative returns 6 months proceeding the start date and in some cases crashes began).
    *Many markets in Europe are making 2009 lows. However unless the markets are making 12-15 year lows a major secular low is not in place.
    *China slowing but still reasonable growth.

    This post does not constitute investment or trading advice and the class of assets discussed are volatile and risky.

  • 664 BP // Jul 29, 2012 at 10:15 pm

    You certainly ‘read the language of the market’… and paraphrase it almost verbatim. Easy to see where you get this hi-falutin’ terminology. For a laugh, just copy and post any one of ‘your’ perceptions into google to ascertain its origin. Whatever turns you on, I guess.

    Do you have anything more _original_ to offer?

    “EXTREME optimism like BP has….” (?) Hardly. I’m an opportunist who has maintained flexibility, enabling me to respond to low markets. To make significant capital gain, I need those lows. Yes, I’m optimistic about property, because _rising rents_ are a growing source of my retirement income. I’m certainly not optimistic about residential construction, or my income from bank interest rising, or my wife’s Super fund rapidly growing in value. Nor am I optimistic about share markets hitting 5000 by December 2012. A major fall to around 3200 would offer another nice windfall, again… .

  • 665 Plornt // Jul 30, 2012 at 1:20 am

    BP I can see how the information I gathered from various sources can come across as pretentious. That was not my intention and it was more just trying to order thoughts and hopefully start a debate.
    Prefer not to reinvent the wheel when there are thousands of smarter people who want to help less informed people make better decisions by providing us with detailed research and ideas. Be arrogant to say I know better when they have better education insights and research. Appreciate the hard work put into the research or opinion to utilize it.

    “EXTREME optimism like BP has….” (?) Hardly. I’m an opportunist who has maintained flexibility, enabling me to respond to low markets. To make significant capital gain, I need those lows.

    I guess I shouldnt have made it such a broad comment. It pertained to your bullishness re property values. We differ in terms of you predicting a plateau in Australian median house prices and me thinking a reversion back to the 4-5x income level historically through price declines.
    You clearly have discipline and a good analytical ability. I am working on my discipline now as it has been missing for a few years.

  • 666 Greg Atkinson // Jul 30, 2012 at 7:52 am

    Plornt one thing we can say for sure is that the outlook for the Australian stock market will depend on factors beyond the control of the RBA or Government. I don’t expect the Australian stock market to crash simply because the All Ords/ASX 200 are bouncing around lows now and have been for some time. Seems to me a recession in Australia has already been priced into stocks.

  • 667 BP // Jul 30, 2012 at 10:09 am

    I think we all agree that the global economic situation is complex. Greg’s recent call: “Seems to me a recession in Australia has already been priced into stocks…” does seem a little pessimistic, but perhaps he’s counting on a new government to quickly reverse this trend(?)

    Who knows where share markets will be in December? For my kids’ benefit, I hope Greg is right in his 5000+ ASX call.

    Optimism: Property offers _either_ high rents, or _high_ CGs… and at rare times, both. Our ‘optimism’ is based on an either/or proposition. Our call is based on:

    * Increasing population

    * Decreasing residential construction… despite low rates…

    * Rental shortage where people _want_ to live;
    Competition for high-quality rentals…

    * Low priority given home purchase by many.
    Vehicles and mobile phone contracts come first…

    I actually don’t think wages come into it much. Our experience is that those on low incomes aren’t in any queues for our rentals. (With one exception being an unemployed woman who paid us a year-in-advance.) Nor do I see any prospect of future sales (either land or houses) to any couple with a combined income under $100K.

    Bottom line? More people, fewer vacancies, more competition, higher rents. IF rents blow out, home _sales_ and prices may increase steadily. It’s a win/win for those who work at it…

  • 668 Stillgotshoeson // Jul 30, 2012 at 3:39 pm

    Greg Atkinson // Jul 30, 2012 at 7:52 am

    Seems to me a recession in Australia has already been priced into stocks.

    I disagree Greg, I still feel that there are many that think the government will “do something” to protect the market further so are still in. What is worse is that some of these same people think the government intervention will work and save them, so no I do not think stocks are fully priced in for a recession.

    “I don’t expect the Australian stock market to crash simply because the All Ords/ASX 200 are bouncing around lows now and have been for some time.”

    Nor do I, the catalyst for the coming decline in the ASX will be from overseas conditions.

    “Plornt one thing we can say for sure is that the outlook for the Australian stock market will depend on factors beyond the control of the RBA or Government.”

    As I stated above, many expect and hope that the RBA and Government will try and do something, and worse expect it to work.

  • 669 Stillgotshoeson // Jul 30, 2012 at 3:42 pm

    @Plornt, I have no doubt we are in for much, much higher (mortgage) interest rates in the medium term.

    A while back I said in a post we could have 5 more years of this depressed state of the economy and we will be in recession, after that will be the high (mortgage) interest rates.

  • 670 Plornt // Jul 30, 2012 at 4:20 pm

    http://www.istockanalyst.com/images/articles/sentiment2520725201925202012PNG2012755197.jpg

    Bullish Sentiment index (AAII) at pessimistic extremes.
    Similar readings historically –
    31/12/2007
    (13%) after ~20 days
    30/6/2008
    (-31%) after ~2.5 months.
    20/3/2009
    Cycle lows.

    You arguably should screen out the 2010 samples as its in bull cycle. Obviously we need to go back further but from my use of this back in 2009 2010 I found it unhelpful at best. It makes sense that as people become extremely pessimistic in a bear market – that pessimism has momentum – and you cant turn on a dime and suddenly investing in back in vogue because value appears.

    July 26, 2012
    This week’s AAII Sentiment Survey:
    Bullish: 28.1%, up 5.9 percentage points
    Neutral: 28.8%, down 7.3 percentage points
    Bearish: 43.1%. up 1.3 percentage points

  • 671 Plornt // Aug 1, 2012 at 9:01 am

    Over 60,000 ES_F contracts sold in last 4 seconds. Double the amount that caused the last flash crash.

    FOMC — Might get another QE temp spike to flush out the last of the short sellers ? Surely the sheeple have got to realise that QE is having less effect – law of diminishing returns.

  • 672 Plornt // Aug 4, 2012 at 10:54 pm

    “This is unscientific enough that it should be good for a laugh for anyone who feels so inclined …“

    Ned I can see the way the six points raised were unscientific. I was just trying to share personal experiences of what unravelled during 2008 more than providing analysis with scientific backing. I have some statistics that support the points asserted but your implication was correct — the post was rushed and lacked detail.

    Am just a trader / investor trying to learn methods suited to my personality in order to produce decent and consistent returns. Not asking to be the best or brightest — just on my patch of grass minding my own as most of us are.

    Ned you clearly have great insights, discipline and emotional control. Hopefully with time and effort I will gather greater emotional control to improve my ability to see the forest for the trees.

  • 673 Plornt // Aug 7, 2012 at 12:32 pm

    Increased my shorts overnight. Think the short covering is almost exhausted and we are almost at max stat draw of 13250. 2nd DJIA short system fired (2 systems firing has never failed) and XAO short system fired yesterday. See how this plays out. Seems to be a lot of traders nervously holding long whilst knowing downside risk is pretty severe. Volumes anaemic.

  • 674 Plornt // Aug 10, 2012 at 4:40 pm

    Warren Buffets cash levels similar to 2007 levels and net seller last qtr.

    “At the end of 2010, Berkshire held $38.2 billion in cash and cash equivalents, the highest year-end level since 2007. The company’s total book value, or its assets minus liabilities, swelled a record $26.2 billion, helped by good results from nearly all corners of the company, housing-related businesses excepted.”

    “Cash advanced 7.5 percent to $40.7 billion in the three months ended June 30 2012, the Omaha, Nebraska-based company said in an Aug. 3 regulatory filing. Berkshire was a net seller of equities in the quarter as it cut its allocation to companies that make and distribute consumer goods while boosting holdings of financial firms and a group called “commercial, industrial and other.” Individual stocks weren’t listed in the filing.”

  • 675 Stillgotshoeson // Aug 10, 2012 at 9:55 pm

    No changes to portfolio. Slight rise in value from last post.

    SBM 6100 @ $1.365 $8326
    ABY 13000 @ $.41 $5330
    GRY* 8500 @ $.66 $5695
    PRU* 3900 @ $2.31 $9009
    FML* 300000 @ $.035 $10500
    BPT* 7500 @ $1.19 $8925
    CDY 500000 $.018 $9000
    BKP 714000 @ $.014 $9996
    EVN 7370 @ $1.645 $12123
    EXS 30000 @$.145 $4350
    PIO 50000 @.027 $1350

    Shares $84604
    Cash $ 351
    Portfolio $84955

  • 676 Greg Atkinson // Aug 11, 2012 at 9:57 pm

    I am counting on a last quarter rally to get the ASX All Ords/ASX 200 up near 5000 points. Before then I expect there will be some more gnashing of teeth as the slowdown in China spooks the market again, but hopefully when investors realise the sky isn’t falling we will see some serious money move back into stocks.

  • 677 Plornt // Aug 12, 2012 at 7:06 pm

    Possibly Greg – I certainly see a rally at some point, and maybe that is in the final qtr of 2012 – the question is how far we need to fall before it begins or if we have already made the secular lows for a new bull market to begin. For the long term investor buying at the right price is all that matters so I guess all this market action is just noise provided you know the price you have bought has given you sufficient margin of safety to avoid permanent loss of capital and you have back tested results to show that your method works over 20 or 30 years.

    My 100 year returns model on the XAO has spat out negative returns for the XAO for 2012 (max draw 30% from 1st Jan prices or 2912) and 50% chance of positive returns on the DJIA. The DJIA is also near max sample extremes if it were to finish positive at year end. 13500 is the extreme, and on a trade basis is 13250 system one 13240 system two and 13550 system three and 13300 system four. I have been searching for long systems on the DJIA and XAO and there are currently zero for the DJIA and 2 for the XAO, both systems have severe drawdowns 15-20%, so one could probably short these initially.

    I did LUCKILY dump all my longs at 4350 just prior to the last correction and got out of the US markets at 12800 when that market was severely overheated as I was getting too many short systems triggering which is repeating again BUT WORSE. Am betting any further “corrections” will be bigger than the last.

    I am DESPERATE to go long and constantly try and prove my analysis wrong each day, but I can’t see a solid reason to be bullish on either indexes atm that is backed up with solid statistical evidence. Perhaps as the rally continues higher I will cover my shorts and then go long and then everyone can fade me. I could be absolutely wrong and I am worried that I am but my automated decision making tells me otherwise so I must trust the stats and process – not the emotions, or what I wish to happen !

  • 678 Plornt // Aug 17, 2012 at 12:43 pm

    Longer term picture:

    Secular Bull Market, 1982 – 2000, (18 years)

    - Secular Bear Market, 1966 – 1982, (16 years)

    - Secular Bull Market, 1949 – 1966, (17 years)

    - Secular Bear Market, 1929 – 1949, (20 years)

    - Secular Bull Market, 1921 – 1929, (8 years)

    - Secular Bear Market, 1905 – 1921, (16 years)

    - Secular Bear Market, 2000 – 2016/2017 ?

    Thus there is a high likelihood the DJIA will at some point over the next 4 years have a serious fall. This cycle has been going for 110 years.

  • 679 BP // Aug 17, 2012 at 2:32 pm

    Comment from a Senior Business Analyst I’m closely related to (who doesn’t view the stock market as gambling):

    “If you bought at the PEAK in 1929 and held through 1929-1945 you would have made money, assuming dividend reinvestment. It’s all about having
    a long term view.”

    WW2 may have helped a little, of course… . ;)

  • 680 BP // Aug 17, 2012 at 2:32 pm

    Comment from a Senior Business Analyst I’m closely related to (who doesn’t view the stock market as gambling):

    “If you bought at the PEAK in 1929 and held through 1929-1945 you would have made money, assuming dividend reinvestment. It’s all about having
    a long term view.”

    WW2 may have helped a little, of course… . ;)

  • 681 BP // Aug 17, 2012 at 3:16 pm

    Mobile dongle nudged steering wheel while submitting. Appears to have sent two-for-the-price of one… ! :D

  • 682 Plornt // Aug 17, 2012 at 3:18 pm

    Yes Biker you could do that if you had say 5% of your net worth in equities and 95% with no quotational risk. Not to mention the fortitude to average down into the worst crash in history already being psychologically burned at the top (and likely unemployed and unable to fund anymore purchasing).

    Most people seem to – very smartly – have most of their assets tied to no quotational risk and then obviously have the patience because they are patient with 5-10% of their net worth. The other 90% is usually in private business or its in real estate and then they play stocks on the side with very little of the returns actually from the stock market. Its very simple to buy and hold with no quotational risk – anyone can do this. I have great respect the person who has skin in the game (i.e. 90% of their net worth in the markets or in cash reserves waiting to be deployed into the markets). If your business analyst friend has 90% of his net worth in equities then his advice is very important and will take it on board.

  • 683 Stillgotshoeson // Aug 17, 2012 at 3:57 pm

    ABY and GRY gone
    11Kg Silver In.

    SBM 6100 @ $1.37 $8357
    PRU* 3900 @ $2.45 $9555
    FML* 300000 @ $.039 $11700
    BPT* 7500 @ $1.255 $9412
    CDY 500000 $.018 $9000
    BKP 714000 @ $.015 $10710
    EVN 7370 @ $1.67 $12307
    EXS 30000 @$.15 $4500
    PIO 50000 @.027 $1350

    Shares $76891
    11Kg Silver $10007

    Cash $ 942
    Portfolio $87848

  • 684 Plornt // Aug 17, 2012 at 4:28 pm

    The way I am investing now Biker isn’t rocket science – it’s simple. All I do is work out the IV and discount rate from my formula that I created last year and have been refining for 12 months. I then know, at the entry price that I’ve bought close to the low for the next several years, and irrespective of how noisy the markets are or what happens I have purchased with a margin of safety against permanent capital loss AND temporary quotational risk. Then you just do this over and over again with nomore than 5% per stock and as many stocks as you can find each year.

    Then you sell when profit growth reversion stops and declines – that may be 1 year form now – 3 years from now 5 years etc. Then rinse and repeat. I am very much a fan of Benjamin Graham and feel any qualitative analysis is just not practical for us mortals who have no business experience.

    To beat the market substantially you really need macro overlay (10-15% p.a. from stocks and 10-15% p.a. from macro trading) to kick the returns higher + equities returns. The only way I think you could substantially beat the benchmark (i.e. 20-30% p.a. after tax returns over 20 years compounded) with equities alone is with severe concentration and to get as much money as possible into your best ideas. Then it comes to qualitative analysis – which requires copious amounts of business experience. I can not do that, so I must stick within my circle of competence.

    I have 5 long equity investments now that I bght near max draw and 4 out of the 5 are in gain substantially (with the other one only in loss 1%), and probably may give back the gains; (for which I am net short through macro in any case) then we will erratically go all over price wise until another high is reached; then rinse and repeat, but it doesn’t matter because I know statistically the price I paid is near the max draw level for the next several years, so psychologically I will not panic sell. IF I now pay a higher price – that statically I have no clue that the price is cheap – then emotions start corroding my framework and I will not have the stamina to buy and hold, and start questioning everything when something inevitably unexpected occurs.
    I’ve found that it’s very difficult to be disciplined with over complicated methods, so I simplify things, and break it down to what is absolutely working, and what is the bare minimum required ! :P Simplicity; not time consuming and repitition. I have no problems doing the same thing ad infinitum once it works.

  • 685 BP // Aug 17, 2012 at 7:30 pm

    Too much risk exposure for me/us, Plornt! I appreciate you taking the time to explain, in relatively simple terms, what you’re doing…

    My ‘friend’ is actually my eldest son, whose comment on mine: “WW2 may have helped a little, of course… ”
    follows:

    “Actually, you probably wouldn’t have even done /THAT/ badly if you
    look at 1929-1939. Japan’s stock market is a much much scarier
    example. Down 75% 20 years after the crash (not including any of the
    dividends).

    http://finance.yahoo.com/echarts?s=%5EN225+Interactive#symbol=%5En225;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

    However, Japanese stock PEs before the crash were around 100.

    http://www.vectorgrader.com/indicators/japan-price-earnings

    Current PE for the S&P 500 is 16, so I think stocks are priced
    relatively well and that sort of performance would be in a doomsday
    scenario.”

  • 686 Ned S // Aug 17, 2012 at 9:25 pm

    Fully expect your son is sophisticated enough to know that some companies that appear on stock market indexes (indices?) go bankrupt and never re-appear (plus dividends/earnings on those that don’t get smashed have to be added in), but regardless he might get a bit of fun out of checking out the pictorial down the bottom of the following? :

    http://www.quasimodos.com/info/dowhistory.html

    Cheers bloke,
    Ned

  • 687 Plornt // Aug 17, 2012 at 10:23 pm

    “However, Japanese stock PEs before the crash were around 100.

    http://www.vectorgrader.com/indicators/japan-price-earnings

    Current PE for the S&P 500 is 16, so I think stocks are priced
    relatively well and that sort of performance would be in a doomsday
    scenario.””

    PE of 16 for the SPX isn’t that overvalued relative to US government bonds which is obviously the margin of safety a lot of people use. I think it perhaps loses relevance when US gov bond rates are at < 1% lol. At 1% I have a huge margin of safety buying pretty much everything, but bonds lol. I'm sure it's probably at historical extremes showing how cheap equities are relative to bonds giving people more reason to venture long.
    I just looked back in history and the Oct 8 2007 top on the SPX was at a pe of 15.2 (fw), but interest rates were obviously substantially higher.

  • 688 BP // Aug 17, 2012 at 10:38 pm

    When I was playing with this stuff a decade ago, I was only looking at PEs around 14, or below.

    The exception was a winery I (thought I) knew well.

    This little gem followed the exact route Ned mentions: “some companies….go bankrupt and never re-appear…” (!) :D

    Great wine, corrupt board, dodgy insurance claim around $8mil… sudden death of winery… . Fortunately we’d picked up around $185K on a block sale that year, so we wrote off that $55K loss, but I ceased attempting to arrest descending cutlery! ;)

    Enjoyed the link, Ned!~

  • 689 Plornt // Aug 17, 2012 at 11:03 pm

    “When I was playing with this stuff a decade ago, I was only looking at PEs around 14, or below.”

    The forward pe for the SPX is currently 13.55.
    http://online.wsj.com/mdc/public/page/2_3021-peyield.html

    “Great wine, corrupt board, dodgy insurance claim around $8mil… sudden death of winery… . Fortunately we’d picked up around $185K on a block sale that year, so we wrote off that $55K loss, but I ceased attempting to arrest descending cutlery!”

    This is why I stray away from qualitative analysis. I was in a listed company in 2009 where management had supposedly a great reputation; said everything was tracking a long nicely within annual reports, and then suddenly mass accounting revisions followed by a trading halt and bankruptcy. It was like a slow motion train wreck after that.

    Luckily I only lost 2% of my capital; although we were constantly “promised” some residual that looked more and more unlikely as time progressed.
    I think we’ve all suffered somewhere during the tough learning curve.

    Thanks for the link Ned found that a great read, and have bookmarked it for future reference.

  • 690 Plornt // Aug 17, 2012 at 11:20 pm

    “but I ceased attempting to arrest descending cutlery!”

    haha !

  • 691 Plornt // Aug 17, 2012 at 11:26 pm

    Very odd price action atm. AUD.USD is down; SPX up; Gold is up.
    Divergences everywhere.

    Another system just triggered on AUD.USD short, and looking to increase position size 20% over existing levels from ~1.05.

    Covered Gold short for 20 point gain as I want to wait for direction here. Hopefully it spikes up so I can get a re-entry closer to 1700. Looking for it to break out of triangulation to give some clarity.

    Still short ES and cut long position on USD.CAD for 50 pip loss.

  • 692 Plornt // Aug 17, 2012 at 11:36 pm

    Watch the EUR.AUD pair for some sort of bounce, and then perhaps a reshorting opportunity. Great pair to short for carry, and any further Euro worries into the seasonally poor months of Sept-Oct.

  • 693 Plornt // Aug 19, 2012 at 7:10 pm

    Well we rose ~18% from the August XAO intraday lows of 3829. We need to move at least 20% off the major lows for a bull market confirmation. Thus 4594. IF this is only a bear market rally then you only have potentially ~4-5% more upside from here, and a huge amount of potential downside. Usually when you fail to break 20% on a major bear market rally after a fall of 20% or more there is a high likelihood of new lows occuring.

  • 694 Plornt // Aug 22, 2012 at 8:52 am

    Looks like DJIA has made a double top both intraday and on a closing basis.

    I am not sure what is going to happen, but price action is suggesting something big to the downside, and many have rightfully and logically capitulated long, and short covering seems to be exhausted.

    We are just outside Max draw on 2 of my systems which is normal as they usually move 1 standard deviation outside the maximum drawdown before a reversal.
    1428 was the stop on the SPX based on this and it rejected it at ~1427.

  • 695 Greg Atkinson // Aug 22, 2012 at 10:45 am

    The Australian stock market has been creeping up for no good reason in my view. The Baltic Dry Index is down over 50% this year and is just above $700 USD which should be enough to worry investors. The economic slowdown in China looks like it is going to be with us all of this year and I am not counting on a good 2013 either.

    However I still think the market is a touch over-sold so later this year we might get a boost from the Europeans finally sorting themselves out or perhaps a new president in the U.S?

  • 696 Plornt // Aug 22, 2012 at 1:09 pm

    Yep Greg the BDI looks like it’s on life support, and it doesn’t make sense for the Australian market to be entering a bull market when Chinas economic slowdown is only just starting.

    A double top on the DJIA usually means the correction will travel 50% of the duration between the double top formation from the technical signal. That would give an approximate October 3rd correction end; then we reassess.

    “However I still think the market is a touch over-sold so later this year we might get a boost from the Europeans finally sorting themselves out or perhaps a new president in the U.S?”

    It is oversold, so a bounce is possible. You could argue we need to fill the gap to 6,000 on a technical basis (i.e. double top formed from May 2010 and March 2011 resistance will be breached as double tops seldom signal secular tops).

    The problem I see is the XAO 50% level of 4080 has been breached from the August 9 2011 level of 3829, and usually this signals a high likelihood new lows will occur after any bounce i.e. a significant break of the 2009 low of 3091 on Mar 10 2009. My 100-year XAO returns model which uses another method is also in line with this in terms of max draw. This is in stark comparison to the 87 correction which did not breach the 50% level on April 11th 1989. Indeed when the 50% level was breached in 1990 the lows were retested. In 1987 the price action was predominantly above the 700 dma, and the secular Bull market was still in its infancy whereas we are now in a confirmed secular bear market.

    Historically major bull markets rarely start without fresh 6-12 month lows which is another red flag. The duration of this sideways movement from the lows has decreased the likelihood of a bull market. If this was indeed a new historical bull market it should have breached the 20% rally off the 3829 lows (up ~18%) , and continued on — not given back a huge % of the rise, and failed to make new lows followed by a sustained rise without giving back significant portions of the rally (and as further confirmation 15td above the 10dma within 6 months from those lows).

    I’m not sure what will happen in Europe Greg. We do know their system is structurally flawed, and there is the possibile cascading domino effect from Greece re Spain France Italy etc sovereign debt defaults. I am quite confused as to what they are actually doing. It’s obviously getting quite complicated and messy.

    All my drivel is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 697 Stillgotshoeson // Aug 23, 2012 at 1:12 pm

    Normally do update at end of a trading day, however…

    SBM 6100 @ $1.49 $9089
    PRU* 3900 @ $2.62 $10218
    FML* 450000 @ $.042 $19350
    BPT* 7500 @ $1.187 $8902
    CDY 500000 $.017 $8500
    BKP 714000 @ $.014 $9996
    EVN 7370 @ $1.695 $12492
    PIO 50000 @.028 $1400

    Shares $79947
    11Kg Silver $10630

    Cash $752
    Portfolio $91329

    Sold EXS $.195 $5830
    Bought 150000 FML @ $.040 $6020

    Washington H. Soul Pattinson & Company Limited’s (ASX: SOL) announced by SOL today (“SOL Offer”). Under the SOL Offer, SOL proposes to acquire all the shares in the Company that it does not already own, for $0.19 per Exco share (“SOL Offer”).

    On a side note, I bought 1200 EAU on 26th July for $9.98 each. up 27% :)

  • 698 Plornt // Aug 23, 2012 at 7:37 pm

    Hopefully you will do well from here Shoes ! Sentiment has certainly changed for some commodity plays, and many gold stocks appear to be oversold. NCM V-bottom looks very very convincing — at least currently !

    Looked at APN Media, and used IV method which determined a max draw of 6 cents (current share price 40 cents). This is the potential drawdown, and may never occur. Thought that must be an anomaly, but when I applied it to some media stocks within America; similar lows occured (e.g Meg @ 1.50$). Looks like years of pain ahead unfortunately – at least from these levels, and suggests there may be more losses in future years ? Looks like a value trap for now even if it does find some support and bounce. Need bigger % discount rates.

    All my drivel is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 699 Lachlan // Aug 23, 2012 at 10:38 pm

    Good to see everyone hanging in while non-directional markets try to wear out all the pundits.
    My upper trend line for the Au/Ag pennant formations treats the Feb 29th highs as failed breaks and is otherwise validated many times….and that trend line is now firmly broken through to the upside with RSI confirmation. Would not short term trade it of course considering how nearly every trade signal fails these days. The recent oversold lows were the buy point. I am not saying the fight won’t resume here or a little higher and lower lows could still come …but there is a real chance we have a bottom.

    As for the DX well it has failed at support and sold off a little but it may still fight back yet and continue it’s staggered crawl higher. Until or unless it starts rocketing higher (like it can) it does not seem so relevant.
    I have to say however that the market indexes are set up well for further upside imo with a pause due but otherwise a strong base built by the recent action. Dow for mine looks much better now days with the early June reversal and subsequent rally/pause/rally.
    Miners still look sad however, albeit cheap buying. Obviously I’d sooner buy those than overbought shares in other classes however I see upside yet in divi shares such as banks and WOW for eg. Maybe a dollar short trade rally has already begun… minus the miners…?

    There is no reason QEeazing would stop now imo and if there were such thing as a free market with supply and demand equalling price discovery it would have collapsed a long time ago. I guess I don’t have many friends in my inflation boat at present but anyhow that’s just my position and I’m sticking to it until something new emerges on the horizon.
    For now my MO remains… buy dips, long term, don’t sweat the volatility.

  • 700 Lachlan // Aug 24, 2012 at 7:14 am

    http://www.marketwatch.com/investing/index/DXY

    DXY has lost 1.5 units down a step-stair slope this last five days (from high to low).
    I have to laugh every time I see headlines at MarketWatch…like “Stocks retreat on Fed stimulus doubts”….they have to try and validate/explain every twitch in the market when in as though a mass of nervous investors are out there running like sailors from one side of the boat to the other. I am not saying they don’t at times but I am dubious to the weight they give there, minute to minute each day. The market is moved up and down more at this stage by the powers that be while retail is just a victim waiting to be trapped on the wrong side of the trade. Where are the volumes? Crumbs there is hardly a website these days without an add to trade oil or gold or FX or some other thing stuck in there. Come in to my lair says Mr Dimon, if you dare. Can you beat us in our own casino? Anyhow that’s my intuition on the matter and I am not saying it ain’t fun to take on the fellas if you can afford a flutter in Vegas. The world has never been perfect so make the most of it how it is I reckon. If you get steam-rolled well you wont be the first one….and if you can’t handle heat then you should not be in the kitchen.
    Hmmm, quite a sermon there! ;)

  • 701 Plornt // Aug 24, 2012 at 8:27 am

    “I have to say however that the market indexes are set up well for further upside imo with a pause due but otherwise a strong base built by the recent action. Dow for mine looks much better now days with the early June reversal and subsequent rally/pause/rally.”

    It could be just a pause Lachlan. From a technical perspective on the DJIA the price action has continuously bounced off and respected the 35dma since the June lows. However 5 major breaches of the 35dma gives a trend exhaustion point, and thus people unfortunately get caught on the blowoff when a reversal takes place. We are approaching the 5th test now which would confirm with lower highs, and obviously the recent double top confirmed on both closing and intraday basis. I would argue the price action is more likely hinting at something more severe than just a pause.
    For disclosure I have increased my ES shorts as of last night.

    For gold we still need 30td above the upper triangulation; we are only on day 3, but it definitely looks very strong. We know triangulations can fail miserably (due to HFT perhaps ?)– see GC June 27 2008 thus I am cautious until it’s confirmed. The two candles that broke out is not typical of candles that hold a breakout, so your higher low reversal could play out there which could allign with my system short.

    For gold it is clearly in a cyclical correction right now given gold fell > 20% off the ~1920 highs, and has only bounced
    10% off the lows which at best is still just a bear rally from oversold status. Hopefully we see (as we all hold precious metals) 1832 breach (>20% rally off the lows) + 30td above triangulation + higher lows for the next 3 months to confirm a new bull market. My system max draw kicks in at 1680 (which is now), so lets see if this rally really has momentum.

    Glad you are doing well Lachlan. You have handled the volatility well. I’d rather be very cautious and skeptical of the move right now, and wait to swing at something with more certainty.

    All my drivel is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 702 Greg Atkinson // Aug 24, 2012 at 9:44 am

    My long term modelling of the ASX 200/All Ords suggests they are both in the oversold area except if I am severe with the mining & hard commodities related stocks.

    In that case where the market is now is within what I would call a mining-gloom range.

    A year or so ago I expected the commodities cycle to turn downwards and prices fall as I wrote about numerous times. But lately I am starting to contemplate a scenario where the big mining companies have overestimated demand over the next say 5 years by quite a margin.

    Some say that couldn’t happen, but many major shipping companies & shipyards are now dealing with the fallout from their overly optimistic forecasts so I think it’s prudent to be a little cautious about the mining sector for now.

  • 703 Plornt // Aug 24, 2012 at 11:21 am

    Looks like Gina is partially trying to dump 5% of her Fairfax stake ? What is wrong I wonder ?
    FXJ max draw is 14c as of now; however, IF there is just one more statutory loss in the next 5 years that max draw drops to 7c !

    The Fairfax family dumping their stake has got to raise a red flag one would think ?

    All my drivel is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 704 Stillgotshoeson // Aug 24, 2012 at 11:28 am

    I’m tending to think an October 1987 scenario for October 2012 and setting portfolio on this.

    Confident of QE3 now, doubt the money is heading to where it is hoped to go though.

    AUD PM’s should get a boost through this if I am right and get a 95 cent AUD vs USD

    11000 +/- 500 DOW and 3800 +/- 200 ASX200

  • 705 Plornt // Aug 25, 2012 at 6:56 am

    Looks like Bernanke opens his mouth again with QE rumours sending the market higher. This is having less and less effect on the markets in terms of % moves. Law of diminishing returns.
    A red flag here is Gold and Silver did not move significantly on Bernanke’s news of ‘further scope for action.’

    We just need lower highs here to confirm the downswing, or if that doesn’t confirm it would breach the double top which may lead to new highs, and then we are looking for the 6th test of the 35dma after any blowoff E-wave, but I think that is the least likely scenario.

    All my drivel is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 706 Plornt // Aug 25, 2012 at 7:35 am

    “Of the 482 companies that have reported earnings to date for Q2 2012, 70% have reported earnings above the mean estimate, but just 42% have reported sales above the mean estimate. The index’s blended earnings growth rate for Q2 2012 is 5.6%. The Financials (60.2%) sector is reporting the highest earnings growth rate for the quarter while the Energy (-22.1%) and Materials (-15.9%) sectors are reporting the lowest earnings growth rates.

    Since June 30, the blended earnings growth rate has increased to 5.6% from 2.7%. The Financials and Utilities sectors have recorded the largest increases in growth rates, while the Energy and Materials sectors have recorded the largest decreases in growth rates. The current 12-Month forward P/E ratio is 12.8. This P/E ratio is below the average forward 12-Month P/E ratio over the past 10 years (14.4).

    For Q3 2012, 77 companies have issued negative EPS guidance and 21 companies have issued positive EPS guidance.”

    FACTSET

  • 707 Plornt // Aug 27, 2012 at 9:30 pm

    APPL – new highs – unbelievable move ! Trend is looking extremely exhausted though; irrespective of the obvious strong fundamentals.
    2 short systems have triggered on this, so looking to try and establish a short position for targets of 520 initially.
    I think this is very close to a secular top at least technically. AAPL is arguably overpriced relative to other products with similar or better quality, and the market seems saturated.
    690 is max draw.

    All my drivel is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 708 Plornt // Sep 1, 2012 at 9:32 am

    “Systematic traders 7.08%, Discretionary Traders 8.79%, and S&P 500 Cash -.93%.

    The 1999 to 2009 statistics support the case that discretionary traders have outperformed system traders by statistical return measures. Interestingly, both groups have easily outperformed the market return over this particular time period.

    According to Barclayhedge, if one looks at the time period from 1987 to 2009, systematic traders returned 9.33%, with a Sharpe ratio of .37, and drawdown of 22.07%. Discretionary traders returned 9.20%, with a Sharpe ratio of .61 and 10.67% drawdown. The SP500 returned 9.41% from 1987 to 2009. Interestingly, both groups underperformed relative to the market, but the numbers seem to support discretionary trading as a better alternative to systematic trading.”

    I think this is interesting, and telling. Shows discretionary traders on average do better than system traders. Both outperform the SPX over the time period, but system traders have double the drawdown with – on average – less return than discretionary trading. ATM I a discretionary system based. I don’t think I could ever be pure system only; the drawdowns from a pure system design would eventually be huge (as markets change and volatility inevitably increases as your edge fails); no thanks. I would prefer to be in control of drawdowns outside IV equities. Equities are impossible for me trade. The best situation for me is to just buy and hold type investor with an IV method and then sell when the cigarette butt has nomore puff; not on some technical basis. Simple and low maintenance.

    That said I am sure the best system designers can do much better than average, and with thorough back testing, but without having a high level discretionary based knowledge (something I am still a long way off) i’d argue the system runs the risk of blowing up as markets are always changing. Paul Tudor Jones has probably back tested thousands of systems – if pure system trading worked well why didn’t he just move from discretionary based to purely system ? Because it is not that simple.

    Perhaps what you need is a trade structure; a framework that outlines everything and importantly thorough adaptive risk management through multiple market conditions. That is the Holy Grail ! Then you just take the data and put it within a framework with lots of discretionary variables. That will always adapt to every market condition quickly.
    That said I guess everyone has to find what works for them, and then attack the areas of strength with a lot of discipline.

  • 709 Plornt // Sep 1, 2012 at 9:42 am

    “Traders always argue over which is better; systematic trading or discretionary trading? I believe this question will always be debated, but by looking at some statistics we can try to get a better understanding. I am a systematic trader, so I am biased, nonetheless, I began to research answers to this question and came up with some interesting statistics that I would like to share with you.

    The systematic and discretionary data is from http://www.Barclayhedge.com. I calculated the S&P500 data and the compounded returns from 1999 to 2009.

    Systematic traders 7.08%, Discretionary Traders 8.79%, and S&P 500 Cash -.93%.”

    From 1987 – 2009 it was fairly even in terms of returns. However that period includes the 80s and 90s where system trading was not prevalent as it is today. It seems like there is a bubble in system design, and everyone is back testing their strategies competing for more and more edges creating more and more volatility.

  • 710 Plornt // Sep 1, 2012 at 10:03 am

    I’ve looked back at a few people historically with great system designs, and eventually their account blows up, or their equity curve still rises, but with 60-70% drawdowns. One would have to wonder if they made significant changes to their algorithm once their drawdown became huge.
    Usually they do very well for a few years which gives them confidence things are going well, and then in a small period they “trust” their system as Max DD gets worse and worse. From a psychological standpoint most would have problems handling this drawdown without any basis in fundamentals of the markets. Just trusting the thorough backtesting of your system (e.g. martingale; CGAR etc). Statistics lie sometimes, and putting too much weight in them is dangerous. If you have more and more people catching on to this edge (and there are many statisticians constantly combing the markets for edges thesedays) your drawdowns could worsen considerably over time.

    I guess the best system designers would be spending time refining their algorithim over and over to make sure things are ok, but how can you do that confidently if you don’t have the knowledge base from a discretionary stand point ? You wouldn’t have the market insights to make the correct changes. I guess that is why some of the best discretionary floor traders are instructing programmers in some of these system based trading firms.

  • 711 BP // Sep 1, 2012 at 10:41 am

    “I guess the best system designers would be spending time refining their algorithim over and over to make sure things are ok…”

    Evolutionary algorithms ‘refine’ best possible scenarios by systematically killing off less robust survivors. The real problem is the quality of information you feed in. It’s that old ‘garbage in, garbage out’ issue…

    There’s a wonderful example demonstrating that very principle over at Money Morning Australia right now, but it’s grist for another (property) mill… :)

  • 712 Stillgotshoeson // Sep 1, 2012 at 12:29 pm

    Plornt // Sep 1, 2012 at 10:03 am

    I’ve looked back at a few people historically with great system designs, and eventually their account blows up…most would have problems handling this drawdown without any basis in fundamentals of the markets.

    Fundamentals are a big part of where and why I invest, economic and personal. What is best for me at this point.
    Taking the divorce as a baseline, 2003. Houses had begun to increase in price, I could have got into a house for similiar value as the one I left, 200k. Looking at salary at the time vs renting and child support obligations and mortgage payments and child support obligations renting won hands down in respect of ease on budget.

    Renting an buying shit I don’t need to impress people I did not like was an option or investing the difference was the other. The latter option was the one taken. Without a doubt my nett wealth position is far greater taking that option over the purchase of a house originally.

    2003+ was good for the share market and housing, cashed out of some equities prior to the crash and bought back in to make some very good money post crash.

    Fundamentals for housing (melbourne especially) and equities, BHP, RIO and the big 4 do not look that good. Precious metal fundamentals look very good. These fundamentals will change into the future, PM’s will be risky, volatile and potentially devastating to a portfolio if the weighting is too high in them. Equities and housing will become worthwhile again in a portfolio. Even our exalted commentator admits to long periods of flat property prices, however property as an income provider is very good to have in a portfolio. Gearing up on expected forever rising capital gains is not sound investing either.

    Picking the absolute top and bottom on any investment strategy is impossible

  • 713 Plornt // Sep 1, 2012 at 12:47 pm

    Thanks BP — I will look into Evolutionary / Optimisation Algorithims, and add it to the list. I think i’ve learnt about 2% of what I need for trading now. I’m starting to realise I know very little the more I learn (and yes I’ll quote Plato lol).

  • 714 Greg Atkinson // Sep 1, 2012 at 1:52 pm

    I don’t think you can algorithm-out fundamentals. I always keep in the back of my mind the reality that models can work really well until they don’t :)

    Anyway it seems the ASX All Ords/ASX are both limping along again. I am watching the data out of China for some signs the slowdown might be bottoming out but it doesn’t look good at the moment.

  • 715 Plornt // Sep 1, 2012 at 3:37 pm

    “I don’t think you can algorithm-out fundamentals. I always keep in the back of my mind the reality that models can work really well until they don’t ”

    I agree with that — am now incorporating more fundamentals into my trading; which now opens up an entirely new area to study.

    That said I am sure there are many people out there who have done successfully for many years with their own mechanical system based trading; I hope they continue to produce alpha for many years. I guess I am just looking at things more from an average Joe perspective; not the cream of the crop.

  • 716 Plornt // Sep 1, 2012 at 3:55 pm

    “Fundamentals for housing (melbourne especially) and equities, BHP, RIO and the big 4 do not look that good. Precious metal fundamentals look very good. These fundamentals will change into the future, PM’s will be risky, volatile and potentially devastating to a portfolio if the weighting is too high in them. Equities and housing will become worthwhile again in a portfolio. Even our exalted commentator admits to long periods of flat property prices, however property as an income provider is very good to have in a portfolio. Gearing up on expected forever rising capital gains is not sound investing either.

    Picking the absolute top and bottom on any investment strategy is impossible”

    I agree with the analysis that the fundamentals for BHP, RIO look poor. The Iron Ore spot price is looking abysmal – I might run some systems on it an see what max DD is like. Fortescue Metals cash costs was A$54 a tonne.

    I agree equities will be great again giving respect to cyclical and secular trends, and having diversity within asset classes,
    I think we need to be realistic about returns from equities at least. 5-10% p.a is very good when you are in a secular bear market.

    Picking the absolute top and bottom is not very easy to do – but impossible maybe not – perhaps after trying 3 or 4 times it is possible haha. I know looking at the data 90% of my returns have been from picking major turning points. I usually miss the last 20-30% of the move.
    I like this quote from David Tepper:
    “I am the animal at the head of the pack… I either get eaten, or I get the good grass.

  • 717 BP // Sep 1, 2012 at 4:31 pm

    Plornt: “Even our exalted commentator admits to long periods of flat property prices, however property as an income provider is very good to have in a portfolio…”

    Well, we enjoyed almost a decade of flat prices in the eighties, allowing us to amass sufficient property to roll over into much more land and houses as we sold off a raft of beach properties. Without very similar plateaus to those we’re experiencing now, we’d have found it much more difficult to eventually retire in comfort.

    On _flawless_ evolutionary algorithms, very few individuals, exalted or otherwise, have the nous to create them, let alone spell the terms correctly. It’s possible to optimise, reducing risk, but as Sylvia Nasar noted, most of history’s economic geniuses were wiped out by crashes, despite their systems, models and acumen!~ :)

  • 718 TV // Sep 1, 2012 at 10:53 pm

    What do you think are the current trends in 2012 or the predictions for the economy in 2013?

  • 719 Greg Atkinson // Sep 2, 2012 at 7:49 am

    TV regarding the stock market my view has basically not changed since I wrote this back in January: Australian stock market outlook & forecast for 2012

    Regarding 2013, I am not brave enough to venture that far ahead at the moment. All I would say is the numbers coming out of China suggest the economy there may be heading for a hard landing and if that happens the Australian economy is likely to struggle.

    I have had the Australian economy on ‘recession watch’ for a couple of years and I believe it’s inevitable that there will be a recession in Australia before things pick up again.

  • 720 Plornt // Sep 2, 2012 at 8:43 am

    “What do you think are the current trends in 2012 or the predictions for the economy in 2013?”

    Noone can know what will happen TV. We can only just keep an eye on economic data from the major economies, and see how it unfolds. We will obviously be more wrong than right, but we know not to trade or invest on predictions unless the reward to risk is so asymmetrical as to make it asinine not to take it.

    China PMI has now gone into contraction – below 50, so that is not good. BDI is probably going to break to new lows, VIX is basing, and is above the complacency level of 15-16$ currently at $17.47; dollar index higher lows – UUP channel support @ 22$; CBOE put/call index showing a potential reversal in equities; CL triangulation which could breakout to the upside – which would be inline with moves historically when equities peak; Buffet’s recent 13f revealed oil positions — although the size indicates his managers may have taken the positions. Not to mention the recent Australian construction data; Copper H&S.

    I would probably say the Chinese economy may continue to slow, and the Australian economy will probably have the worst recession in history in 2013. You can’t have collapsing real estate markets (our housing bubble is BIGGER than the United States in terms of real prices historically); worsening commodity prices from China slowing; a more frugal consumer loaded to the hilt with debt, and suddenly pull yourself out of the abyss; we have no manufacturing industry. Not to mention there has been no recession for almost 20 years – mean reversion will create a disaster. Yes I am alarmist, but I would rather be predicting the worst, and be prepared than remain optimistic prior to major secular reversals, and get slaughtered. I hope I am absolutely wrong because this scenario is terrible for everyone. It requires copious amounts of discipline to sit on the otherside. Right now many people are focusing on a new bull market – Technically I do not think it exists, and I am certain there will be months where I will foolish, but I will hold my stance.

    I’m sure business is going well on the ground, and that the recent stimulus cheques have increased business activity temporarily, and GDP is running a long fine, but we know stock markets are leading indicators, and that the economy can turn on a dime very quickly. If you look at Rail Car Loadings in North America a huge collapse – in total traffic – did not occur until October 2008, but the market had fallen significantly prior to this. Equities bottomed in ~March, and Railcar loadings and baseline and cyclical are still below October 2008 levels; bottoming 2-3 months after equities.

    TV I hope you navigate the rapids well, and that your success continues into the immediate and long term future.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 721 Plornt // Sep 7, 2012 at 8:24 am

    Closed ES and AUD.USD short positions, for 30 point loss on ES or 2% of capital, and closed AUD.USD short for 1.5% gain or 350 pips; net loss from 2 trades .5% of capital (up 2% on silver physical holding thus offsetting the trading drawdowns). It looks like potential E-wave on DJIA here. Rediculous and unexpected, but that is what markets do. Looks like a 6 retest top breakout, but the movements are not normal at all.
    Alternatively we could push through here, and then reverse. I’m going to just wait and see how this plays out.

    Government intervention is ruining the normal movements of markets, but I guess we should expect that by now. This is like playing ping pong. Risk management is crucial.
    Going to look to re-enter shorts either a lot higher, or with more confirmation of a move down.

  • 722 Plornt // Sep 7, 2012 at 12:15 pm

    After reviewing the ES short, I have now re-shorted the ES position in full. I may put some option calls on this in case of a further rise.
    3 systems are at max draw and these systems are very reliable; can’t be going against it for some technical basis which is not quantifiable. Just shows how useless classic TA is. Classic TA showing bullishness; all my systems are going short.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 723 Plornt // Sep 7, 2012 at 5:03 pm

    Election Cycle Returns:
    2000 -9.1% Bush vs. Gore
    2004 10.9% Bush vs. Kerry
    2008 -37% Obama vs. McCain
    2012 ? Obama vs. Romney

    It looks like the presidential election cycle positive return correlation is breaking down. Last 12 years it has produced negative returns 66% of the time.
    There has never been one -30%+ return – until 2008 – in the past 84 years which is a red flag when something is going 3x normal max negative return.

  • 724 Plornt // Sep 7, 2012 at 5:17 pm

    Every negative year for the past 84 years finished with a positive return on the following year.
    We had 14 consecutive presidential election years without negative returns, so that is another red flag in regards to the correlation continuing. So far markets are up in line with it, but the year has not ended ;).

  • 725 Plornt // Sep 7, 2012 at 6:20 pm

    Re-shorting AUD.USD secondary entry @ 1.0330. Max DD now 1.05.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 726 Lachlan // Sep 8, 2012 at 5:32 am

    US dollar bulls got their sharp shake out last night Plornt but I would be looking for a fair bounce in the USDX soon with some technical support around 80ish. If we are going to get one of those classic super spikes in the dollar this might be a good place to begin buying again. I think that prognosis is still fair based on the action in Europe. Plenty room yet to scare the market. I just don’t want to be too black and white on it though. It is reasonable imo to suggest that while the Euro-show has all the punters dazzled that the market may be gently pulling away in the other direction and eventually leave them stranded.
    So there you go, that is my call based on fundamentals ie nothing in particular….but the chances of a technical dollar bounce are good soon.

  • 727 Plornt // Sep 8, 2012 at 3:08 pm

    Lachlan definitely volatile, and creating capitulation. I always liquidate when stops are hit, and will put back on IF the trade is still good. I have double checked all the systems, so there are no errors in the stats, and I have a lot of rules to override the system if something is not right. None of the rules are overriding, and everything is playing out as expected.

    We are at max DD on 3 systems, and now there are now 8 short systems active on the DJIA. This is asinine, and these systems are not small moves. They occured prior to bull market tops, and the price action is almost identical. Example that recent candle spike appeared on almost all the samples near the top. On all samples the yellow H/L candle was preceding the red candle just prior to a collapse. These are just common technical traits, but not the trading systems (we all know technical “signals” in isolation are useless). I suspect we might spike 200-300 points higher, but there is a major secular bear market top here.

    I think people are underestimating the gravity of the move down. Historically the DJIA used to trade at .4x or .7x of book value in the 1930s/1970s, so DJIA is rediculously overpriced irrespective of earnings. Even if you allow for PE expansion – given demographics – the Baby Boomers are moving to retirement phase, and now drawing on funds to live off this is arguably going to cause PE contraction. This ~40 year cycle is due again. The 110 year secular bear cycle is due. The hardest thing to do is to change at major turning points. Most people stick to what works, and then get killed. Look at the Presidential cycle in 2008 if you had followed that ! -37% – buying “value” stocks like BAC and C mid year !

    I’m not sure what the catalyst is here. Could be war ? I am looking at war cycles now Lachlan, and what affect that may have on currencies, and precious metals. Looking back in history there are major spikes for both USD and precious metals in either direction; which creates an interesting trading environment.
    Europe mess seems resolved temporarily with the bond purchase announcement. History shows when you have one big event it seldom ends there. There are always more cockroaches in the kitchen. A bit like a company that issues its first profit downgrade — you invariably know more is to come ! Remember when Bear Sterns went bankrupt … then Lehman shortly after. Many pundits were calling value then as well. I didn’t listen to anyone, and prefer to think for myself !

    The market always gives you a chance to get out, and also to get back in, so we have to get over the fear of being wrong, and just focus on trading for 12 months with discipline in execution, and avoid making bad decisions based on the circumstances – irrespective of the financial outcome.

    Usually in trading you have to battle it out for 8-9 months, and then in a 3-4 month window you will make 95% of your returns. The problem is IF you sit the hard times out, and try and time entries back in you don’t learn to become a good trader, and over time you will lower your returns as most of the time you will miss huge portions of the moves. It works sometimes, but trading through all this I have learnt a lot, and am not afraid of any market gyration now. A lot of things you need to survive you learn trading these markets, and it is invaluable, and you can’t find it in books. Like Paul Tudor Jones says “While I’m a staunch advocate of higher education, there is no training – classroom or otherwise – that can prepare for trading the last third of a move, whether it’s the end of a bull market or the end of a bear market. There’s typically no logic to it; irrationality reigns supreme, and no class can teach what during that brief volatile reign. The only way to learn how to trade during that last, exquisite third of a move is to do it, or, more precisely, live it – a sort of baptism by fire.”

    You have to get over your fear of losing money. I once had a string of 20 trading losses in a row, and I only lost 5% of my capital because of sound risk management. Then after that – when everything looked terrible – I went on a streak of 10 wins, and 1 trade wiped out the 5% drawdown, and then some. This happens over and over – maybe not to the same extremes – but it is something to get used to psychologically. Being wrong is normal, and being wrong or right has little correlation towards profitability.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 728 Stillgotshoeson // Sep 8, 2012 at 6:10 pm

    Plornt “You have to get over your fear of losing money. I once had a string of 20 trading losses in a row, and I only lost 5% of my capital because of sound risk management. Then after that — when everything looked terrible — I went on a streak of 10 wins, and 1 trade wiped out the 5% drawdown, and then some. This happens over and over — maybe not to the same extremes — but it is something to get used to psychologically. Being wrong is normal, and being wrong or right has little correlation towards profitability.”

    I think we will soon see this in a practical example in the 100k portfolio I post.

  • 729 Plornt // Sep 9, 2012 at 2:33 pm

    Stillgotshoes; your portfolio must be doing well ! Hopefully you continue to make great returns on your precious metal equities !
    I have sold my equities mid last week as I am not comfortable with the risks as positions went into profit, and then the reward to risk became unfavourable on max portfolio risk given what the IV methods max DD at historically, and the inherent underlying index risk.

    So let’s see how far the DJIA will drawdown over the next week. I am not adding anymore to my position as I don’t want to push potential risk limits now, and can’t add till the secondary entry within profit. The main short is a mirror convergence divergence system, so the bigger the drawdown the more the shorting targets fall, so you are not limited to your first bet reward as your potential return. Inverse correlation between draw down and risk; provided the setup is high probability. Then if you just keep position size at 50% max on the first entry, and don’t average down past that; wait for confirmation of the MAX DD; then increase 200% once max DD is confirmed + within profit on a lower Max DD confirmed re-entry, and the targets become static.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 730 Stillgotshoeson // Sep 9, 2012 at 3:23 pm

    Since the 100k Portfolio started in Jan, it has gone from 5% up to 18% down (round figures). Have not done the numbers recently but it is about 8% down still at a guess. Expect it to improve now and into 2013. No changes to the portfolio since last update as far as holdings go. There has been a dividend payment from BPT of 1.5 cents a share to be added to the cash balance as well.

  • 731 Plornt // Sep 9, 2012 at 4:32 pm

    The SPX has a 6 yellow candle trigger on August 10th. This is actually bearish as the first trigger is on Feburary 9th 2012; thus ending the trend on the second. It is just broken up with huge amount of noise. Hopefully noone is getting trapped on that basic trigger thinking of massive gains.

    You also have new highs; which if you look back in history almost always happens before a collapse.

  • 732 Stillgotshoeson // Sep 9, 2012 at 4:55 pm

    18 months to 2 years ago or so over on DRA discussing the inflation/deflation possibilities with Ross I said I would not be surprised to see the DOW hit 15000 before this is all over due to the money printing that was (and has) come. With more expected we may see one large spike up in the DOW.

    Still does not change my view that it has a long way to fall when it does.
    my view that Australia is headed for recession has not changed either.. a couple years out on when I thought but still feel it is on it’s way. September Quarter figures could be line ball going into negative. 2 consecutive quarters… will it be 2nd 1/2 2012 or will we make 2013? Don’t know. Playing my cards in anticipation of continued decline in the Australian (and world) economy.

  • 733 Plornt // Sep 9, 2012 at 5:19 pm

    Looking at the 6 yellow trigger, and although am not using that signal to trade, but even that basic trigger is signalling a correction ! looking at this quickly / crudely I came up with a correction multiple of ~10-19x the 4th candle of the first 6 yellow candle trigger off the maximum rally intraday highs; excluding any trend triggers occuring prior to the first retest of the 35dma. Not sure what max DD is for that though.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 734 Plornt // Sep 9, 2012 at 6:08 pm

    “18 months to 2 years ago or so over on DRA discussing the inflation/deflation possibilities with Ross I said I would not be surprised to see the DOW hit 15000 before this is all over due to the money printing that was (and has) come. With more expected we may see one large spike up in the DOW.”

    15,000 is possible. I have looked at this in detail for many months. I’m not so sure the spike will come. Maybe it will, and we will spike to 1500 SPX resistance to complete the R shoulder, and also channel resistance from the 2009 lows. DJIA is already at channel resistance from the 2009 lows + double top intraday, and on the long term charts.
    I am ruling it out because the systems that fired would go about 4 x Max DD which has never occured in 30 years. And we are getting many of the signals that usually appear at the top earlier. Whether that means the discretionary systems are broken – i’m not sure – but I doubt it. I think SPX technically looks more like the 2007 top; where we just make a slightly new high then reverse. In fact many of the same systems of that situation are firing now. And similar in 2001, 2002, 1987, 1991. In all the situations there is a distinct pattern in terms of how far the drawdowns increase.

    But I can definitely be wrong. I can handle a drawdown to 16,000, so I am not worried about the drawdowns as I only have 25% of my position on, and I avoid averaging down most of the time.

  • 735 Stillgotshoeson // Sep 9, 2012 at 6:30 pm

    “I am ruling it out because the systems that fired would go about 4 x Max DD which has never occured in 30 years.”

    We have not seen this much money thrown at the world economy so we may have new rules…

  • 736 Plornt // Sep 10, 2012 at 7:45 am

    Stillgotshoes maybe — we will have to see — maybe we are both right lol i.e. we correct heavily; then bounce heavily to 15,000.

    I think the party is close to over on the DJIA secular, and precious metals cyclical, so I don’t want to be drinking the kool aid when the whole thing falls a part. I am wearing 10 layers of clothes for when the tide goes out lol.

    Gold looks very parabolic right now; getting a bit worried tbh. This is looking like a lower high version of the 2011 spike which is ominous for the index as money flows to less risky assets. Everytime Gold goes parabolic like this the Indicies invariably top out.

    Warren has said Gold is a bubble, and implied it may soon fall a part. I have checked back on all his bubble calls for the last few decades, and he has never got a bubble call wrong, and his timing has been very close to the peak. Thus I am not betting against Warren.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 737 Greg Atkinson // Sep 10, 2012 at 8:10 am

    Recently I have stopped looking at a whole heap of charts & have just been watching the Baltic Dry Index (BDI) and the economic news out of China. The BDI is currently around 651.00 and close to the low hit during the darkest days of the GFC. The economic situation in China is obviously so bad that officials have lunched for the ‘let’s build anything’ lever again.

    So at this stage I am waiting for the BDI bottom-out & some signs from China that the economy is stabilising. Hopefully when these developments occur I might be able to get a feel for when the All Ords will make a run towards 5000.

  • 738 Stillgotshoeson // Sep 10, 2012 at 9:02 am

    I am happy to continue betting against WB for a little while longer yet, after all Gold has outperformed Berkshire for what 10 to 12 years now..

    China appear to be reluctant on opening the purse strings right up at this stage.

    Poor job figures out of the USA have improved the chances that the US Fed may move sooner rather than later on more stimulus.

  • 739 Plornt // Sep 10, 2012 at 11:23 am

    Ok so the next project is to find a fundamental IV method based on low beta, with very minimal drawdowns, and occuring just before volatility expansion to the upside !

  • 740 Plornt // Sep 10, 2012 at 1:36 pm

    “I am happy to continue betting against WB for a little while longer yet, after all Gold has outperformed Berkshire for what 10 to 12 years now..

    China appear to be reluctant on opening the purse strings right up at this stage.

    Poor job figures out of the USA have improved the chances that the US Fed may move sooner rather than later on more stimulus.”

    I am long as well Still — hopefully it will keep rising, but I am just trying to look at it objectively. Just worrying about when to hedge my silver position; trying to work out the time lag between DJIA top and precious metals, and if there is even a pattern there.

    I don’t see how they would stimulate the economy unless there was a serious fall in the market, so the rally in precious metals is arguably in anticipation for a fall in the DJIA; then when the DJIA falls the money moves out of precious metals as people buy DJIA again because of the anticipated QE. The problem with this is the affect of the QE on the economy will have more and more of a diminishing effect, so we will end up being stuck in a cyclical / secular lower low bull / bear configurations.

    We know cyclically there are issues with the price movement of Gold. Yes it is in triangulation both on the LT, breached the 1 2 3 upper boundary, and broke out of triangulation on the daily. However if you track gold it is currently unable to breach the 20% rally, and the duration of the move is now ~4x the average time taken to breach 20%. That is big red flag. We are also failing to breach new highs; although the gold in CHF i think is testing new highs ?

    Also in 1940 when US 10 yr treasuries were at similar rates gold underperformed significantly for many years; not that anyone should base their decisions on that one period given many differences between the time durations.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 741 Plornt // Sep 10, 2012 at 1:43 pm

    There is a simple technical signal of 1 year highs holding which gives a trigger on gold of September 6th.
    But the problem with that setup – patterns change – and the structure of the underlying cycle does not look right price wise.

  • 742 Stillgotshoeson // Sep 10, 2012 at 3:28 pm

    “Just worrying about when to hedge my silver position; trying to work out the time lag between DJIA top and precious metals, and if there is even a pattern there.

    I don’t see how they would stimulate the economy unless there was a serious fall in the market, so the rally in precious metals is arguably in anticipation for a fall in the DJIA; then when the DJIA falls the money moves out of precious metals as people buy DJIA again because of the anticipated QE. The problem with this is the affect of the QE on the economy will have more and more of a diminishing effect”

    Silver: My hedge has been to buy a couple of kilos every so often.
    Not even going to try to time the market. Longer term looks good for silver anyway. Any pronounced dips will be me buy in even more quantities, not going to sit around and wait for a dip that may not occur, or is too brief for me to any significant advantage of.

    Precious metals rising in anticipation of DJIA falls.. I don’t think it is as simple as that. Gold and the DJIA have both risen since the GFC and the first rounds of QE. Stimulus is finding a home in both markets. Gold will rise further if the DJIA falls. Gold will rise further if there is more stimulus. The DJIA may not rise due to the fear of impending economic recession and contracting commodity prices. Emphasis on the MAY NOT. May still see that 15000 spike. So many variables at play that flaws will show up in any system.

  • 743 Stillgotshoeson // Sep 10, 2012 at 3:47 pm

    SBM 6100 @ $1.75 $10675
    PRU 3900 @ $2.67 $10413
    FML 450000 @ $.043 $19350
    BPT 7500 @ $1.30 $9750
    CDY 500000 $.015 $7500
    BKP 714000 @ $.014 $9996
    EVN 7370 @ $1.70 $12529
    PIO 50000 @.027 $1350

    $112 Dividends BPT
    Shares $81563
    11Kg Silver $12021
    Cash $864
    Portfolio $94448

  • 744 Lachlan // Sep 10, 2012 at 4:30 pm

    Hi Plornt
    What sort of lows does your system predict for on the Dow and All Ords…and sorry if you have already said it.

  • 745 Plornt // Sep 11, 2012 at 8:17 am

    Hey Lachlan 12,000 is the target if recent highs don’t breach. If they do then the target will fall.
    The systems are hitting maxDD, with the additional allowance for the % increase of the DD. It has constantly rejected these levels, so from experience I know if the system was broken it would normally just completely rip through these levels; there should not be any price resistance;. A bit like the gold situation, but even then 3 bull system fired against 1 short prior to the price explosion. There are zero bull systems right now vs 8 short.
    The path of obvious resistance is down lol. We must go there ;).

  • 746 Plornt // Sep 11, 2012 at 8:40 am

    So maybe just one more spike higher here, or even a double top closing on the SPX.
    Usually when the 200dma begins to gyrate like that it means range bound with lower lows, and usually lasts 2-3 years. Began August 2nd 2011. Even if this is the start of a bull market usually markets will make new lows, or close to new lows prior to the bull market explosion out of multiyear development – lower lows; higher highs.

  • 747 Plornt // Sep 11, 2012 at 10:02 am

    US Consumer credit -3.3 bill !! exp 10 bill. What a miss.

    AD/D dj30 9/21 on high volume ~580m
    Best / Worst performers Commercial Printing 3.18% – Education Services @ -6.27%.

  • 748 Plornt // Sep 12, 2012 at 11:57 am

    Covered my second ES short for a scratch, and covered AUD.USD for 100 pip loss. Reversed ES short to long (but only 10% of original position). One of the rules to override has kicked in for both, and increased Max DD.
    Will look to short higher up. The first thought is usually the right one !
    Targets are still the same, but risk became too high given the maxx DD increase.

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  • 749 Plornt // Sep 12, 2012 at 12:38 pm

    “May still see that 15000 spike. So many variables at play that flaws will show up in any system.”

    Spike to 15,000 could happen. There is definitely a bigger spike here, but we both agree it isn’t sustainable, and it will end it tears.
    My IV method is giving sell signals on many secondary entries which means there is a high likelihood any rally is going to reverse below the existing lows of the index.
    I had a look at the 2nd major retest and break of the 200dma leading to a rally. This pattern has broken for many stocks in advance of the index; i.e. it breaks the 200dma; reverses to new lows then breaks out again way above the 200dma (where many issues are now); then reverses again to new lows. Have to wait, and watch. I don’t want to be caught trying to catch the bottom, or chasing for fear of missing out; especially when my IV method is not giving me long term buy signals.

  • 750 Plornt // Sep 13, 2012 at 3:29 pm

    Looking at past duration blowoffs a worst case scenario on the DJIA is 13,700 in terms of biggest % moves. That % duration also happens to line up with 2009 channel resistance. Systems are probably useless here, and are being exposed to irrationality, and QE; clearly there is going to be a huge crash on the other end of this; you don’t need a system to tell you. It is just obvious. Maybe 30-35% over 2-3 years.

    The support at ~9,700 is not secular support given the pattern; nor are the ~10,500 lows.

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  • 751 Plornt // Sep 14, 2012 at 7:54 am

    System is now 2x max DD, and completely broken. This is what happens when you follow a system blindly into irrationality. Stillgotshoeson was right ;), and cheers for speaking out.
    It doesn’t work. You have to override. Models / systems can work within expected parameters 95% of the time, and then 5% of the time they can wreak havok ! Statistics lie.

  • 752 Lachlan // Sep 14, 2012 at 7:57 am

    Thanks for answering my question Plornt. I have a fair bit happening here and have no little time to study the markets but will be back around soon enough. Apparently some sort of QE announcement came out today but we’ll have to wait and see what it is all really about. I say it never stopped in the first place (ie money printing) and that it just can’t… and expect a lot more market shenanigans to go yet. Eventually there will be a proper on the streets price inflation…when the time is right. Cheers

  • 753 Plornt // Sep 14, 2012 at 8:17 am

    ” I say it never stopped in the first place (ie money printing) and that it just can’t… and expect a lot more market shenanigans to go yet. Eventually there will be a proper on the streets price inflation…when the time is right. Cheers”

    I am just wondering how far commodities will travel. UUP looks incredibly oversold, but the environment is too erradic to trade (i.e. it is going massively into extremes on either side).
    I think a rule next time I short tops I am going to use options. I could not have done better risk management though; I kept reducing position size, and reversed at the sign of issues; followed my rules. The only thing I did wrong perhaps was not enough reward to risk. I took 2:1; should have taken 4:1.

    Am glad I traded through it – I have never experienced this before, and that should help improve my trading structure going forwards. I think sentiment of traders is a big part of how prices move. I saw a lot of people short with me, and then I thought intuitively this is not good. The more people using the same setup and or system the more unreliable it becomes. Will need to learn order flow, so I can learn where stops are positioned, and how people are directionally positioned.

  • 754 Greg Atkinson // Sep 14, 2012 at 8:24 am

    Seems to me that in the U.S. they are buying time in the hope that the global economy will pick up during 2013. Our market is now trailing that DJIA/S&P 500 by a long margin but maybe the fall back will be a lot less painful for us?

  • 755 Plornt // Sep 14, 2012 at 11:14 am

    Maybe Greg — it is clearly high risk to be investing at either levels unless you are a very good stock picker. We have never had secular lows 5 years into a 17 year secular bear cycle.
    How many outperform a market in a secular bear ? 5% of participants ? And produce positive returns above term deposits from the start of the secular bear market in 2007 ? Looking at a lot of fund manager results, so many have underperformed their benchmarks, and they are the professionals; obviously the retail investor has underperformed the managers probably 95%, so it is not very good overall.

    Funds management industry is going into contraction for good reason, and I remember Jim Rogers saying the finance guys become the biggest for a while then it inevitably contracts for 10-15 years. I am guessing continued poor returns for the next 5-10 years for most as they index hug, and then the strongest will survive and thrive, but the weakest will get knocked out. How many funds management businesses are still alive in Japan post 1992 ? Likewise for the ones in 1930 – 1940s and 1970 – 1980. But I guess the top managers will always do well nomatter what conditions. Seldom do things start going into contraction, and suddenly stop worsening. Therefore that is red flag for returns going forward. Many fund managers dumped their stakes, so they obviously don’t do that if they think things are going to be great long term.

    Intuitively I am just very worried this is going to end badly. 2,000 XAO is not out of the question if we have a recession given our performance is diverging from the US, and we are making lower highs.

    But I am happy to be wrong for 2 years if it takes that long to occur. Best course of action for investment is to just do nothing until the XAO drops to 12-15 year lows, and then go all-in with high quality companies at rediculous prices. That is what Buffett did with his personal portfolio during the 2000′s if you look back. Then you can buy and hold forever from those levels.

    There is no way you can defend yourself effectively in the majority whilst being heavily invested in stocks if a secular crash occurs. It’s impossible – I have looked at some many ways to do it, and it is incredibly difficult. All you can do is say; good luck, and I hope you make plenty, but I don’t want to tempt fate, and overstay the party — even if you look foolish for years. There is a difference between value, and secular value.

    What is additionally worrying is that the 17 year secular switch is becoming LONGER. For example look at the Nikkei that is way past it’s secular 17 year switch. This could be because of too much political intervention in letting things fail ?. Look what the fed is doing with the QE now. Propping up the already elevated stock market.

  • 756 Plornt // Sep 14, 2012 at 12:17 pm

    System adjustments on DJIA short are max DD 13,751 targets now 11,500. We are also well overdue for a 20%+ bear market correction in line with the 3-5 year cycle. DJIA has not had a 20%+ correction for ~3.5 years. Usually when I adjust the system it will begin working again, so let’s see what happens.
    Am not betting on this as I want to see how my systems react to this environment, but the reward to risk from current levels is very compelling.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 757 Plornt // Sep 14, 2012 at 2:10 pm

    DJIA returns post QE.
    QE 1 ~75%

    QE 2 ~25%

    QE 3 ~8% ?

    Clearly the amount of % return is falling. How much we will get on this move is anyones guess.

  • 758 Plornt // Sep 14, 2012 at 2:33 pm

    This is not going to end well…

    M2 vs SPX divergence

    http://research.stlouisfed.org/fred2/graph/fredgraph.png?bgcolor=%23ffffff&height=480&width=800&id=M2V,SP500&scale=Left,Right&range=Custom,Custom&cosd=1980-01-01,1980-01-01&coed=2012-04-01,2012-09-12&line_color=%230000ff,%23ff0000&link_values=false,false&line_style=Solid,Solid&mark_type=NONE,NONE&mw=4,4&lw=1,1&ost=-99999,-99999&oet=99999,99999&mma=0,0&fml=a,a&fq=Quarterly,Daily&fam=avg,avg&fgst=lin,lin&transformation=lin,lin&vintage_date=2012-09-13,2012-09-13&revision_date=2012-09-13,2012-09-13

  • 759 Ned S // Sep 14, 2012 at 4:02 pm

    But the tricky bit is to say WHEN it won’t end well Plornt – And for Whom – And HOW even?

    Though yep I agree, there would seem to be a lot of moral hazard floating about the place right now.

  • 760 Ned S // Sep 14, 2012 at 11:47 pm

    General market expectation seem to be for the RBA cash rate to drop more over the next 12 months:

    http://www.smh.com.au/business/global-rally-pressures-rba-on-rates-20120914-25xvp.html

    And I would seem to have blinked and missed the following news:

    http://www.smh.com.au/business/forrests-bold-plan-to-save-his-empire-20120914-25xvz.html

  • 761 BP // Sep 15, 2012 at 12:03 am

    We should ask how Stokes’ recent comments align with those of Forrest’s, Ned.

    Interestingly (for me, anyway :D ) Twiggy’s granddad sold my granddad a rural property almost a hundred years ago.

    I’m in the process of writing up that part of the family history (along with photographs past and present) right now. Not sure whether to title the book ‘Flatrocks’, ‘Little Italy’… or ‘WinelAnd’… .

  • 762 Plornt // Sep 15, 2012 at 7:11 am

    “But the tricky bit is to say WHEN it won’t end well Plornt — And for Whom — And HOW even?”

    It is definitely difficult Ned. I must admit I do not understand how to play the game currently atm, so I prefer to stand aside and watch rather than participate. Have no problems admitting temporary defeat ! I never give up, but I need to find a more structured and logical approach to this.

    My situation just shows how much risk management is important. If you just let one trade get out of control you can destroy your account. I make sure I NEVER let that happen, but at the sametime I can’t have this slow bleed. I need to stop for 3 months to force my equity curve to trend up again.

    I am going to have to create strategies that can be used at the latter end of bull markets when irrationality reigns supreme. With tight risk management, so if things turn I can still capture the gains. Clearly the strategies – outside my IV method – I can use early to midway do not work as bull markets progress. New max DDs can be created therefore using the past doesn’t work when the environment is very volatile.
    I think I may drop my position size to 20% / 80% trades / cash in the later stages of bull markets. That should be a fool proof method to reduce issues.

    Also I have to reduce my error rate therefore the only way I can do that is to cut down the amount of strategies I can use. Then I can become good at 2 or 3, and learn to adapt those strategies as market conditions change. Much easier task than trying to execute on 100′s of different setups. Each new setup creates a new learning curve, so you are just chasing your tail over and over.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 763 BP // Sep 15, 2012 at 8:47 am

    Or, as someone here noted back at # 714: “I always keep in the back of my mind the reality that models can work really well until they don’t… .”

  • 764 Plornt // Sep 15, 2012 at 10:06 am

    “Or, as someone here noted back at # 714: “I always keep in the back of my mind the reality that models can work really well until they don’t… .”

    That is true. I guess it’s not so much complicated modelling, but I need strategies that will withstand the market gyrations, and maybe an index or volatility filter in order to avoid breakdowns of those strategies to some degree. I need to also work out which strategies suit which market conditions. You can never protect yourself completely, and they will always fail, but I need to be 100% certain I am trading with an edge, or else the best risk management in the world isn’t going to help me.

    There is no way for the majority to regularly invest or trade with low error rates unless you follow some systematic strategy with an edge. Most good managers have one, and they just obfuscate it to make it look more complicated, but everything is derived from that. Then obviously their talent and/or information edge gets the most out of that positive expectancy system / method. But even the amateurs using that positive expectancy system will still do ok provided their risk management is decent.

    A massive amount of detail needs to go into this, and i’m not sure it is possible to do it outside of 24 months. Hopefully when I return the market will have collapsed, and I can avoid the impending disaster whilst I learn how to properly trade. I probably need to do 60 year back tests to be sure, and put it through an insane amount of testing bordering on neurotic. The problem is trying to code uncodeable systems. I’m not sure it is possible. I also need more automation, and basically become more business like in everything; because you need to basically become a business to trade; you can’t do it separately which I have been trying to do. I need to overhaul everything.

    The last time I left the market for a long period it fell 40% lol, so let’s hope that was just dumb luck !

    I need to ensure I have systems with a huge edge, and the smallest risk relative to reward. Then you need to know everything about how markets work on a discretionary basis, so you can properly implement your methods without emotion corroding the framework, and adapt as markets change. Huge task. Nowonder 95% of people fail at this. There are no shortcuts or quick routes. You need to put up with a lot of pain. Anyone who has done this easily at the start is doomed to eventual failure, and trying to bail yourself out with outliers (we all want them but trying to rely on them is inherently difficult) which eventually wreak havok. Need consistency.

    When I comeback I am going to trade with 25% of my funds until I have 5 years of consistent profitability. Then after 5 years I will increase to 50%. Then after 10 years of consistent profitability I will increase to 100%.
    I should be trading at 100% by the time we get into the next secular bull cycle. Better to do it slow and properly — than try and do it quickly — and end up treading water constantly.

  • 765 Plornt // Sep 15, 2012 at 11:41 am

    I think the simplest way for us mortals to invest is an IV method. No technicals; no futures or options; nothing else. That has been the only thing that I have noticed that has some sort of consistency that is not determined by luck for the majority of us.

    Once the majority of us over complicate, and don’t have the ability to precisely process everything it increases the error rate. For the high IQ people this is fine, but you have to be realistic as to your abilities. I’d rather simple, and consistent with low chance for error.

    If you do the same method over and over you create your own niche, and probably know how it reacts to every market condition over time. You create familiar complexity over time that is within you abilities. Also an IV cigar butt method does not need to worry about Index direction, whether we are in a bull or bear market, or companies profits going forward. You cut out a lot of the copious amounts of information that leads most to make analytical mistakes, and thus reduced returns. I guess this is why Benjamin Graham’s method still works today, and he advocated it; yet most of us keep seeking to complicate things when we are unable to make better decisions doing so. A select few can do it, but most of us can’t, and you have to be realistic about that, and thus become wiser, and make better decisions.

    For example if I had invested in 2009 with the best 10 performing stocks on my IV method screen I would have made 1000% in one year lol. Had you held onto the best performing stock for 3 years you would have made 10x your entire capital base on a 10% investment lol. That said you would probably not be able to pick the best 10 performing stocks, but almost all samples go into the multiples in a very short time frame (1-2 years).
    I think I already have my edge – which I put the hard yards in to find in the last 12 months, and I am jumping from one method to another trying to find the holy grail — another newbie mistake !

    Probably look to switch from trading to investing stocks on an IV method, and switch off the index, futures and options with only 25% of my funds once I finish testing everything thoroughly for an extended duration.

    Anyways hopefully these comments help others not make my mistakes, so your journey is not as painful !

  • 766 BP // Sep 15, 2012 at 12:05 pm

    Good luck with that, Plornt.

    I read quite a good article recently: “Small Investors Getting Burnt” (David Tasker, p. 19, ‘The West Australian’, 13/08/’12).

    It’s Tasker’s view that small players cannot beat HFT trading algorithms used by the big players. He presents a number of scenarios demonstrating that high frequency traders will _always_ be well ahead.

    The winners are the professional trading houses: “In a zero-sum game like the bad market we are in, retail investors are potentially the big losers- they can’t operate as fast and don’t have the huge computer power available and straight to market execution systems that these guys have… .”

    It’s probably a little like trying to beat the casinos.

  • 767 BP // Sep 15, 2012 at 12:53 pm

    For those interested in Tasker’s proposition (and readers’ responses):

    http://goldstocksforex.com/2012/08/13/west-australian-small-investors-getting-burnt/

  • 768 Ned S // Sep 15, 2012 at 1:13 pm

    Not sure if it will help Plornt – But just maybe it can’t hurt? :

    “Why 90% of Traders Lose, Nadeem Walayat’s Trading Lesson” :-

    http://www.marketoracle.co.uk/Article36355.html

  • 769 Plornt // Sep 15, 2012 at 1:23 pm

    Biker it isn’t a zero sum game if you are buying longer term with a sound investment strategy on longer time frames. Definitely futures, options and fx are zero sum games.

    If I buy shares in a company with a 3 million market cap, and it has 5 million cash net of liabilities, and I get the business for free how are the HFT trading algorithims going to front run my investment returns for the entire holding period ? They might take a chunk out initially and at the selling point. Also I am pretty sure the broker I use has pretty good algortihms because when I execute a sell order at limit it almost always gets sold higher than I asked for.

    The only way out for us mortals is to extend out the time frames, and move to the unsophisticated areas of the market where there is not enough liquidity to eliminate the pricing inefficiencies quickly. We don’t have that much capital relative to the big players, so that is always a benefit for us, so it makes no sense to be playing in the areas with more competition.

  • 770 Stillgotshoeson // Sep 15, 2012 at 3:10 pm

    Your current portfolio (live)
    Portfolio total $59,860.30

    National performance (at close 13/09)
    National leader $65,815.27
    National average $51,502.34
    Your ranking (at close 13/09)
    National ranking 142 of 8386*
    State ranking 32 of 1935*

    It is still possible to put in successful trades even in this market. I am looking at a near 20% return on my “portfolio” in less than 2 months.
    *My rankings will no doubt rise on Monday morning as when they update.

    “Or, as someone here noted back at # 714: “I always keep in the back of my mind the reality that models can work really well until they don’t… .”
    This is true of all investments, be it property, shares, cash, precious metals… Economic fundamentals should always be part of your investment plan. What is happening in the economy that will impact my investments? What is happening in the economy that I can make a buck from? Break it down to sectors and look for the best in those sectors.

    I have not run the numbers on the 100k portfolio, a quick look over.. it seems it is almost back to even.

  • 771 Plornt // Sep 15, 2012 at 3:32 pm

    “In my opinion, a high 90% of traders are destined to lose because they are in fact learning from / listening to the 90% of losing traders that preceded them, who following wipe out in the markets have gone on to focus on writing about market price action and methodology with an even greater concentration observed to occur in the mainstream press as account busted traders / investors turn failure to trade into full time media careers and thus perpetuate a continuous cycle of failing traders guiding new traders towards similar failure. ”

    I agree with this Ned ! I have read so much crap that doesn’t work. I’m not sure even if I managed to learn all the methods that work I’m not sure I would be able to trade consistently as there is a psychological component where I am just not suited towards short term trading. I am pretty sure that I am not going to trade anymore, and make the switch to IV investing. I thought about this in 2011 in my previous posts, and my experience recently has solidified that 2011 thought. The first thought is usually the right one again !

    For me there is a direct issue between expending some effort, and decreased returns. It seems I am more suited to passive asset allocation. My IV method rarely gives buy signals during bull markets, so that would keep transaction costs down, and ensure I swing relatively in often. If I am only sorting through 10 signals during a bull market per year my error rate would drop dramatically, and I would likely have a better chance at making a few outlier investments as my thinking would be concentrated, and not spread thus improving the chances of having 1 or 2 good insights a year that would be held for 1-3 years. I think this is the most realistic approach given all the things I have tried. I am constantly coming back to this.
    I have tried Roger Montgomery’s IV method, and that definitely works, and I have made decent returns using it; provided you have good risk management. The only thing that would stop me from using that more regularly is that fact of trying to determine profits going forwards; it is difficult and thus my error rate would rise again.

  • 772 Plornt // Sep 15, 2012 at 3:52 pm

    “This is true of all investments, be it property, shares, cash, precious metals… Economic fundamentals should always be part of your investment plan. What is happening in the economy that will impact my investments? What is happening in the economy that I can make a buck from? Break it down to sectors and look for the best in those sectors.”

    Still do we really need to look at the economy though for just the small retail guy ? If I start trying to understand how the economy works with no economics degree or business experience – isn’t that being foolish. If I just focus on simple net / net rules isn’t that easier, and less likely to produce mistakes as there are less variables in play that I may never fully understand. I guess this is Benjamin Graham 101, and everyone will frown upon me for being too simplistic.

    I can obviously learn as I go, and embrace new areas of knowledge for the markets, but then I am venturing into areas where I am going to be making mistakes again irrespective of whether I learn in advance. The stock market is very brutal towards making mistakes, and you have to minimise your errors. A monkey could trade my IV method and make money, and even if I bought in at the wrong discount you could still exit at a profit if you held it for a year or two. I made sure it was idiot proof, because I foresaw me doing something asinine in application.

  • 773 BP // Sep 15, 2012 at 3:55 pm

    Well, there ya go, Ned. Look at the wealth you’d have accumulated by now had you too boned up on Mafia Wars, Share Wars and the like!~ :D

  • 774 Lachlan // Sep 15, 2012 at 4:08 pm

    I could not win enough in the short term trading game Plornt. The only person I know who has, had half a dozen monitors and was completely overtaken by it. The system also became harder to gauge like BP was saying with HFT on the go… and whatever else. It seems that no matter what correlations/trends etc you make out in the market by the time you have sufficient observable evidence of such to place a bet, then CRUNCH. It takes a lot of time and devotion to create trades for that…as your posts demonstrate.

    So pull up a beer and go macro with the rest of us mate ;)
    Just being silly of course.
    I can’t help it.

    I was not aware Nadeem was a trading one percenter Ned. I agree with his inflation views of course although I am little more grey on the exactly when part.

  • 775 Stillgotshoeson // Sep 15, 2012 at 4:13 pm

    If you intend sitting out for a while Plornt, play the next asx share game. Current one is closed, next one starts in the new year. Risk free way to test your strategies.

    I like it because there are only a limited amount of companies you can trade in so you have to be a bit more objective in your choices.

    Yes, I believe even if you are a “small retail guy” you should be looking at economic fundamentals.

    One certainly does not need an economics degree, in fact probably advantages to not have one. Your “studies” may cause you to have bias.

    In the sharegame I am holding 5 stocks, 3 of them I actually hold in my portfolio and have even added…
    These are NCM, BPT and PRU 18%, 9% and 24% respective increase.

  • 776 Plornt // Sep 15, 2012 at 4:18 pm

    “I could not win enough in the short term trading game Plornt. The only person I know who has, had half a dozen monitors and was completely overtaken by it. The system also became harder to gauge like BP was saying with HFT on the go… and whatever else. It seems that no matter what correlations/trends etc you make out in the market by the time you have sufficient observable evidence of such to place a bet, then CRUNCH. It takes a lot of time and devotion to create trades for that…as your posts demonstrate.”

    I learnt the hard way Lachlan ! I didn’t spend much time trading tbh. I think I agree with your observation about your friend. If I had to do it properly I would need about 15 monitors and hundreds of systems running through each chart showing me the ratio of bull to bear. Then i’d need a full time prograamer to constantly make adjustments to the systems and add new ones. Then i’d need a rolodex of all the major players in the market, so I can get information updates quickly. Thus that is fantasy and us small players have to live in reality. LESS IS MORE — KISS !

  • 777 Plornt // Sep 15, 2012 at 4:24 pm

    “If you intend sitting out for a while Plornt, play the next asx share game. Current one is closed, next one starts in the new year. Risk free way to test your strategies.”

    Maybe. I might have a go. I guess it can’t hurt to test my strategies out with the competition; then later go feel sick to the stomach that I didn’t invest in them.

  • 778 Plornt // Sep 15, 2012 at 4:48 pm

    So the next question is — When do you sell ? How do you know when it is right to sell ?
    I think for us mortals it is impossible to get that right with consistency, and what you would invariably do is accidentally sell a 50 or 100 bagger outlier.

    I have been swinging from buy and hold to buy and sell, but I am starting to think buy and hold because I would have no clue which companies may rise substantially. Plus I don’t think my net net method is the same as Graham’s; many of the companies keep rising albiet there are a number that give out on the puff. But it seems asinine to try and guess, and at worst you might lose 50% of your investment at that point it becomes a lower discount IV buy which would still rise above your initial entry point over time.

    So looks like buy and hold for me. I wonder if I can deactivate the sell button on my equities platform lol.

  • 779 Ned S // Sep 15, 2012 at 5:17 pm

    I’m no expert on this stuff Plornt – But IMO you’ve been showing signs of being addicted to trading stocks for some time now? (Says Ned who was once a casino and pokies addict and is still addicted to backy and booze and just thanks his increasing old age and decrepitude for his somewhat decreased inclination to give cute young things his money these days … :))

    If you were winning, I truly doubt I’d say anything – But if you aren’t, it might be time to stop and take “stock” just a little bit at least perhaps?

    Cheers mate.

  • 780 Plornt // Sep 15, 2012 at 5:37 pm

    Yep Ned I intend to do this.
    I need to look at what I need to do psychologically in order to be able to hold stocks long term, and not get into this merry go round buy and sell mentality. It is definitely not profitable to trade stocks for the majority.

  • 781 Plornt // Sep 15, 2012 at 5:41 pm

    Thanks for the tips (not financial advice) everyone. I might be a tad slow to grasp things, but it eventually sinks in, and hopefully I will make some changes that last ;).

  • 782 BP // Sep 15, 2012 at 5:45 pm

    One of the truly sad outcomes of this era is the number of future OAPs who thought a SMSF was a pile of poker chips and the sharemarket an ATM.

    Different story if this is money you can afford to lose, of course… but there’s nothing like a few wins along the way to feed an addiction… .

    I’d describe how much fun Monopoly can be, with real streets, real houses and real money, but I sense that there’s already a voodoo doll in my image somewhere having its vital organs skewered with dressmakers’ pins… . (Perfect health rating in my recent annual check-up, BTW, son. :D )

  • 783 Plornt // Sep 15, 2012 at 5:58 pm

    Ned here is the checklist lol:

    Below is a checklist to see if you are addicted to trading stocks

    You know every stock symbol on the top of your head.
    You’re not satisfied until you can make a profitable trade to make up for bad trades.
    You enjoy the challenge of trading over actually making money.
    You are constantly flustered by the ups and downs of a stock in a given day.
    You start to make crazy excuses and blame others for your bad trades.
    You frequent message boards and social networks to try and pump up your stock.
    You are glued to the Twitter stream to see what traders are actively buying and selling.
    First thing you do when you get up and last thing before you go to sleep is check your stocks.
    You find and follow a new stock everyday.
    You start buying based solely on what somebody says.
    You bet large portions of your portfolio on a few stocks.
    You check your account balance every 5 minutes of market hours.
    You scoff at the trading strategies of other people.
    You never really actually get better at trading

  • 784 Plornt // Sep 15, 2012 at 6:02 pm

    “I’d describe how much fun Monopoly can be, with real streets, real houses and real money, but I sense that there’s already a voodoo doll in my image somewhere having its vital organs skewered with dressmakers’ pins… . (Perfect health rating in my recent annual check-up, BTW, son. ”

    Knowing me Biker if I started buying real estate I would begin trying to flip them lol. Think I was just try and buy and hold equities first. Don’t want another brutal learning curve lol.

  • 785 Stillgotshoeson // Sep 15, 2012 at 7:09 pm

    First thing, you will need to decide what your goals are Plornt.
    No point being on the field if you just want to kick the ball around.

    My focus is to be a self funded retiree by 50. Wages, savings and investment focus are towards building a wealth base to then switch my focus to a dividend base. Aiming for 80k a year, with franking credits tax will be negligible. Still save a little each year in an online account to build a buffer for when dividends fall a bit and will most likely put small amounts into small caps, (< $5000)

    Income from a dividend stream will keep me happy until I can access my superannuation. (hopefully the tax free status is still around) to boost my income even more.

    As for playing the game and kicking yourself for trades that work out well that you have no skin in on, how is that different to your current system giving a buy signal and you do not for what ever reason?

    As for timing when to sell, you can not always be right. I have sold out too soon on shares that went on to become 10 or even 10+ baggers, I still made a profit so I am happy. For every Sandfire I missed there was a Timbercorp I missed too so it is all checks and balances in the end. Taking gains and reducing losses means your portfolio should mostly move in the right direction over time, how is this a bad thing?

  • 786 Plornt // Sep 15, 2012 at 7:21 pm

    “As for timing when to sell, you can not always be right. I have sold out too soon on shares that went on to become 10 or even 10+ baggers, I still made a profit so I am happy. For every Sandfire I missed there was a Timbercorp I missed too so it is all checks and balances in the end. Taking gains and reducing losses means your portfolio should mostly move in the right direction over time, how is this a bad thing?”

    That’s true. I really cannot say much until I provide disciplined returns for 10 years. Am a grasshopper that will just listen to the wiser men.
    My goals hmm. Not sure tbh. I just want 8% p.a. returns, and I will be happy with that.

    How do you know when to sell though Still ? I am having problems with that aspect.

  • 787 Stillgotshoeson // Sep 15, 2012 at 7:52 pm

    Plornt // Sep 15, 2012 at 7:21 pm

    My goals hmm. Not sure tbh. I just want 8% p.a. returns, and I will be happy with that.

    There are quite a few dividend paying shares that return this and more, if volatility scares you, buy and hold, buy more on dips. Keep an eye on the economic fundamentals of the economy and the company you invest in. I don’t like the banks because they fund dividends with borrowed money and are, in the current global economic climate, too risky.

    How do you know when to sell though Still ? I am having problems with that aspect.

    If an income return is what you are after, do not sell unless something is going to have dramatic consequences on the company you have invested in. Temporary problem, maybe look to add more holdings on the dips. Something looking more major, get out of them.

    Some stocks I openly buy with the full intention of trading at pre-determined levels. Others I am accumulating in small parcels to build up to a core part of my dividend paying holdings.

  • 788 Plornt // Sep 15, 2012 at 8:18 pm

    ” I don’t like the banks because they fund dividends with borrowed money and are, in the current global economic climate, too risky.”

    I know. Am scared to death of the banks.

    Am not using charts anymore because I think they are part of the cause of my panicing when volatility hits. Seeing too many patterns that could just end up being random noise. If I just focus on valuation that psychological element gets taken out completely.

    I have a short IV method based on my formula. CBA non discounted IV is currently 52$. If our banks move in line with valuations seen in America it will move 26% (65$) above IV before tumbling. GFC type US valuations would put CBA at 7.50$ IF the housing market completely crashed, and bad debts exploded.
    But it needs a catalyst obviously for the IV method to work. If IV keeps rising then obviously the share price will continue to do so.

    Shareswatch forum is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

  • 789 Plornt // Sep 16, 2012 at 11:55 am

    Hey still I was looking at where to hedge my silver position, but then I came across this:

    DJIA returns post QE.
    QE 1 ~75%

    QE 2 ~25%

    QE 3 ~8% ?

    Silver returns post QE

    QE 1 ~40%

    QE 2 ~100$

    QE 3 ??

    It looks like with each QE silver is producing greater % moves relative to the DJIA. Maybe that is because the consensus is DJIA is becoming more expensive as it continues to rise, and silver is still well below it’s inflation adjusted highs ? We know precious metals will do well proceeding a market top for a certain period maybe even months.

    That said silver may retest the breakout point who knows, but it looks like there is a bigger move here after any consolidation. UUP looks like it may breach long term support, and GBP.USD is in triangulation, and the AUD.USD is actually in a triangulation on the long term charts albeit I would expect the AUD.USD to retrace first to perhaps 99-1.00. Max dd was respected, so I would expect some kind of reverse.

  • 790 Greg Atkinson // Sep 17, 2012 at 8:36 am

    Plornt I think another round of QE in the U.S. shows they have lost the plot. It’s as though the Fed wants to wallpaper over the reality that the economy is in trouble by artificially printing money and giving the stock market a few jolts upwards.

    I am now becoming bearish about the outlook for the Australian stock market as well. The territorial dispute between Japan & China is going to put another dent into the global economy plus it looks like the Chinese economy is heading for a hard landing.

    I can’t see too many bright spots out there.

  • 791 Plornt // Sep 17, 2012 at 9:41 am

    “Plornt I think another round of QE in the U.S. shows they have lost the plot. It’s as though the Fed wants to wallpaper over the reality that the economy is in trouble by artificially printing money and giving the stock market a few jolts upwards.

    I am now becoming bearish about the outlook for the Australian stock market as well. The territorial dispute between Japan & China is going to put another dent into the global economy plus it looks like the Chinese economy is heading for a hard landing.

    I can’t see too many bright spots out there.”

    Lol I am not even going to “play or gamble” anymore Greg. Most of us small guys have been gambling without knowing it. And unfortunately it is the small guy that will get hit if they play in environments like this.
    I never thought in my wildest optimistic dreams that they would actually do another QE at the top of the market ! It is clear that people knew the QE was coming prior to it being announced from the action in precious metals. The small guy just can’t get access to this information early.

    Greg I think a recession for Australia is going to happen. I don’t know when, but if I can’t play in this market I would be absolutely crucified in a recessionary cycle !! Therefore I am leaving the poker table as the known patsy, and as Ned said taking Stock, and then I will comeback later, and stick to high quality businesses. No forex and futures gambling. Am going to do it slow and boring.

    Warren in an interview in May mentioned that the first QE was sensible and saved us, but you can’t keep running deficits like this, and having more and more QE. This was before the third QE, so I am not sure what he is thinking now. He mentioned you will eventually have to deal with the pain from this, so that to me suggests Warren thinks the market is likely overpriced. Berkshire was a net seller in the last 13f.

    I think am I going to just buy quality; high ROE businesses, low debt issues in extreme downturns to buy and hold. In my IV method they actually produce less % returns, but they are less volatile, usually produce rising, reliable and consistent dividend income streams, and are unlikely to give back all their gains.

    Example you buy BAC at IV buy of 2.70 in 2009. If you buy and hold that you have little dividend yield, and the gains completely collapsed 3 years later. We cannot relaibly time the market, so trying to exit at the top, and buy at the lows most are going to make mistakes over time even if you get lucky. There are very little dividends to throw off income whilst you “buy and hold.” Or you buy Flight Center at IV 4.00 in 2009, and you get substantially less % return, but you get less volatility, and you get capital gains holding, and RISING yields, and rising profitability with less heart attacks on the way ! I can’t believe since I started investing/trading since 2008 it has taken me this long to figure this out !
    Roger Montgomery is right about sticking to high quality businesses, and many other types of investing are gambling because there are just so many unknowns that you cannot predict reliably what will occur. You can predict that businesses that have been high quality for a considerable period with predictable earnings, and unleveraged will continue to be high quality in the future. It is boring investing, but I guess when it becomes boring, that is when you are investing not gambling.

  • 792 Lachlan // Sep 17, 2012 at 7:58 pm

    “Plornt I think another round of QE in the U.S. shows they have lost the plot.”
    Well Greg few things happen by mistake in politics and Bernanke is not a complete fool…outside of being insane for accepting his role. Imo he could have just said two words ie “All aboard!”. Otherwise nothing much has changed. Zirping right along from day to day, private capital and it’s formation will be taxed while system players are empowered and the leviathan political process lumbers on. The weakest and the unfortunate crushed under foot. The system is consolidating and restructuring… forever it seems.
    Plornt we will just have to see how the dollars continue to be managed into the process as time goes by. The AUD is a chosen one still. It may break to the upside of it’s consolidation soon. You might think this is crazy after Bernankes talk but I still do not rule out more opposite action (USD upside) if the players in Europe can have a short term apocolypse. Maybe they can stop belting up Greece for a while and try out a new European sovereign punching bag. Just keeping a little grey there.

    Anyhow the RBA should have fun explaining themselves as they fend off incoming USD’s…in between anxiety attacks over inflation which I don’t doubt are valid too.

  • 793 Lachlan // Sep 18, 2012 at 6:29 am

    Plornt our irrational fears and doubts control the world we know right to the top. Our habits can mitigate the feelings, crumbs even my coffee drinking rituals settle my nerves I know. But some habitual behaviours are damaging and some not and some of our fears are of course rational also. We seldom take the time to contemplate which before making decisions. I am not judging your own stuff here either, leaving that to yourself…I am making general statements I think are broadly applicable to the world around us.
    In regard to betting on the market I just think the system is far more rigged and manipulated than the majority could possibly know about so short term bets are highly problematic. These guys in the system want to shred you at every turn. I have lost plenty of dough on them in the past. I think your preference for personal honesty displayed here on these pages is going to guide you to places you prefer to be.
    On the lighter side of your recent paper loss well I can tell you that it cannot be too much different to me. I am holding losses on paper too and while those positions are open you could just as easily exchange the remainder of your equity for discounted assets and in real terms you have made no loss at all…if you can uncover correct value conclusions. I understand that risk management will likely keep most of my goodies in tact despite some weak spots across the portfolio.
    Diversification will be a good one I suspect. I might build a house and rent it soon as an example. I was offered a monster discount neighbouring the one I just bought (also discounted). I am not talking costly builds in the burbs here but…quiet in the country but near enough to plenty of farming and mining jobs. I have to evaluate my chances of renting it out better first of course. Quiet rural property has been a very good buyers market for some years now imo although some areas should never have been developed in the first place imo.

  • 794 Lachlan // Sep 18, 2012 at 6:31 am

    So I could be a paper, pm’s and property kinda guy all in one :)

  • 795 Lachlan // Sep 18, 2012 at 9:02 am

    Greg the asx200 looks ready to try and break out. Will be interesting if it does to see how far we get.

  • 796 Lachlan // Sep 18, 2012 at 9:04 am

    Would be wary of going long there myself for sure…CHOP! :)

  • 797 Plornt // Sep 18, 2012 at 1:08 pm

    Lachlan I think I will be ok. I will lick my wounds, and then emerge from the underground stronger :P But I do need some reflecting in terms of holding investments instead of over trading. There is an emotional component that needs rewiring if I am to improve in this area. This is where the passive investor wins out as if they don’t follow everything they are less likely to do something stupid.

    It really isn’t rocket science to invest, but if you are not currently emotionally wired to do it — it becomes much harder, and you need to put in more firewalls, and disciplines in order to rewire the mind. I need to stop thinking the world is ending everytime something goes wrong ! Actually maybe I am right this time and the world IS ending temporarily. I mean I was bullish at the 2010 lows when everyone was shorting, and bullish at the 2009 when everyone thought armageddon was arriving. Maybe I am NOT wrong. Who knows !

    That said we are due for a recession, and the DJIA is close to a crash 20%+. My DJIA short system is actually correct, but after reviewing the trade I miscalculated the max DD, so human error reigns supreme !! Ughhh. Anyways better I stop doing that because there is too much margin for error that I will inevitably make. Lower my universe to low error no brainer investing, and then all you do is ride the emotional rollercoaster over and over each time people jumping off the ride lol.

  • 798 Plornt // Sep 18, 2012 at 1:36 pm

    Irrespective of whether your individual stocks rise or fall if you are betting the index to rise here you are essentially making a housing bet. The bet is that banks will not come under pressure from falling house prices. That is your bet. If one of the big 4 start having rising bad debts (and the regionals are already doing it which happened in the US just before the collapse), and post an EPS loss then all the big 4 would lose serious chunks of their market cap, and the index would essentially halve. That is too much risk for me given the extent of our housing bubble !

  • 799 Lachlan // Sep 18, 2012 at 6:41 pm

    Yes Plornt I agree, after a loss of any kind even a trading one, it is better to put off decisions and listen to your inner guiding light so to speak. Over-trading was a problem of mine at one stage because of my obsessive nature. The same nature can produce good things when management and circumstances coalesce in the right manner.
    With Oz… a lot of Oz people I talk to feel they are in a recession here though even now. I think the downside potential is not completely exhausted in our indexes but far more so than the DOW and at least a little more so than the banks themselves which have had a good run and may get a shake out in the next year or so. The timing has got me beat too apart from a few obvious short term pivots. I thought your short entry on the AUDUSD was a good one to begin with at least, being so extended there. It seems very hard to complete any swing trade though after the first effort to skim profits and reduce risk a little. Every time I look around it seems a trend reversal wants to happen. The casino is in great form last twelve months for sure.
    Alas I am a lazy old macro man now :)

    Gotta take off for a couple days ..cheers Plornt.

  • 800 Plornt // Sep 18, 2012 at 8:32 pm

    Lachlan I will definitely not be making any decisions for a while that is certain :)

    Lachlan I am probably just going to structure everything to go to my strengths. Swing less often, and then swing big at no brainer investments. I remember wanting to go all in on oil at 40$ in 2008-2009. That was such a silly price, and I didn’t pull the trigger. In hindsight the best investment opportunities are obvious, and you need to swing bigger than everyone else when they present themselves.

    I may only make 2 or 3 investment decisions a decade, and then buy and hold them. I know if I only swing at my best 3 investment decisions a decade I am at least giving myself a chance to do OK. It would cut my error rate down substantially, and force a lot more due diligence as I would likely think about certain investments for months in advance. And given that I would not have many bullets I would be extremely concerned about making sure the investment is correct.

    Would require extreme discipline, and patience though as you could look foolish for years. You would potentially underperform for many years as well because you would not chase short term performance.

    Definitely in investing, or trading if you don’t invest or trade to your strengths you are going to do poorly. Knowing what to avoid ! There are enough ways to make money in this market for everyone, but if you end up doing a method that you are not suited towards, and overestimate your intellectual and emotional abilities it will make it much harder than it needs to be.

  • 801 Stillgotshoeson // Sep 19, 2012 at 6:58 pm

    100k Portfolio

    SBM 6100 @ $2.19 $13359
    PRU 3900 @ $2.93 $11427
    FML 450000 @ $.044 $19800
    BPT 7500 @ $1.33 $9975
    CDY 500000 $.017 $8500
    BKP 714000 @ $.013 $9282
    EVN 7370 @ $1.96 $14445
    PIO 50000 @.026 $1300

    Shares $88088
    11Kg Silver $12235
    Cash $864
    Portfolio $101187

  • 802 Stillgotshoeson // Sep 19, 2012 at 8:39 pm

    Have an order in for a Silver miner, if I get my price will update the portfolio, selling down a couple to fund purchase if it comes through.

  • 803 Stillgotshoeson // Sep 20, 2012 at 3:20 pm

    100k Portfolio

    SBM 6100 @ $2.11 $12871
    PRU 3900 @ $2.86 $11154
    FML 225000 @ $.043 $9675
    BPT 7500 @ $1.285 $9637
    CDY 500000 $.017 $8500
    BKP 714000 @ $.012 $8568
    EVN 7370 @ $1.96 $14445
    PIO 50000 @.026 $1300
    AYN 200000 @ .055 $11000

    Sold 225000 FML @ .045 $10105
    Bought 200000 AYN @ .054 $10820

    Shares $87150
    11Kg Silver $12182
    Cash $149
    Portfolio $99481

  • 804 Stillgotshoeson // Oct 1, 2012 at 4:10 pm

    100k Portfolio

    SBM 6100 @ $2.12 $12932
    PRU 3900 @ $2.90 $11310
    FML 225000 @ $.038 $8550
    BPT 7500 @ $1.30 $9750
    CDY 500000 $.016 $8000
    BKP 714000 @ $.014 $9996
    EVN 7370 @ $1.89 $13929
    PIO 50000 @.035 $1750
    AYN 200000 @ .055 $11000

    Shares $87217
    11Kg Silver $12242
    Cash $149
    Portfolio $99608

  • 805 Stillgotshoeosn // Oct 9, 2012 at 8:35 am

    100k Portfolio has had it’s first 100% + Gain

    PIO has hit 4.6 from an original 2.2 purchase price.
    Even if you bought about 3 years ago at 3.8 your up 20% in total, as good as bank rates ;)

    I have full expectations of 3 more breaking 100% returns next year,

  • 806 Greg Atkinson // Oct 9, 2012 at 9:13 am

    The market has posted some good gains since the low of early 2009 the problem is for us poor long term investors is that we are still back overall at 2005 type levels on the All Ords/ASX 200. So we are quickly approaching our own little lost decade as far as the Australian stock market goes.

    However there have been dividends, distributions and the opportunity to take profits along the way so all has not been lost.

    All we need now is a nice jump when we get a new government & another cut or two in interest rates ;)

  • 807 Stillgotshoeson // Oct 9, 2012 at 6:21 pm

    100k Portfolio

    SBM 6100 @ $2.22 $13542
    PRU 3900 @ $2.93 $11427
    FML 225000 @ $.038 $8550
    BPT 7500 @ $1.32 $9900
    CDY 500000 $.015 $7500
    BKP 714000 @ $.014 $9996
    EVN 7370 @ $1.925 $14187
    PIO 60000 @.040 $2400
    AYN 200000 @ .055 $11000

    Shares $88502
    11Kg Silver $12264
    Cash $109
    Portfolio $100875

    Sold 50000 RIO @.046 (reached .049) $2300
    Bought 60000 RIO @.039 $2380

    No CGT liability because still carrying a loss from the RAU
    Shares

  • 808 Greg Atkinson // Oct 10, 2012 at 8:06 am

    Stillgotshoeson I also still have some losses which will offset any capital gains this year but slowly these losses are being erased. One of the few wise things I did late last year was offload my BHP shares at over $40 which made me nervous at the time, but has since proven to be a good move.

    I would like to see the market take another dip, test the support near 4000 & then build up again based on some fundamentals such as:

    - We see further evidence that the mining companies have moved on from the boom and are preparing for some years of ex-boom commodities prices.

    - Another cut or two in interest rates.

    - A change in government.

    - Stability of company earnings. I’m not looking for big profits but some signs that companies have got themselves into a position to ride any downturn but are also ready for any upturn.

  • 809 Stillgotshoeson // Oct 10, 2012 at 8:26 am

    I don’t think we will see a drop to around 4000 before the US elections. Really bad news from Europe or an escalation in the Iran situation aside.

    Another cut or two in interest rates, I do not think will add much stimulation to the economy. The trend is still reduced borrowings and the reduction of debt. Unemployment is going to have an uptick
    so confidence is still not there imo to see much gain, if any.

    Stability of earnings, many companies are going to suffer further falls in earnings as we continue a recessionary type spending/saving situation.

  • 810 Stillgotshoeson // Oct 10, 2012 at 9:24 am

    ASX Sharegame update.

    Your ranking (at close 09/10)
    National ranking 126 of 8528
    State ranking 35 of 1962

  • 811 BP // Oct 10, 2012 at 8:09 pm

    In the interests of calling-to-account some of the outrageous punts made in this forum, let’s review just what has been ‘moderated’:

    BP // Oct 10, 2012 at 8:40 am

    Shoes: “…people who know little about shares or investing in shares should not be posting in a share thread…”

    People who flaunt their expertise, investing $100K to make $875 between January 2012 and October 2012 should _definitely_ be posting in a share thread, however… .

    It demonstrates that their retirement plan, living on less than 1% per annum, could be flawed. Of course if your view was that Australian banks would crash and burn in 2012, there’s a kind of twisted logic in play there, dear readers*… .

    * Gone all Sayce-Denning on us now?

    Your comment is awaiting moderation.

    813BP // Oct 10, 2012 at 10:04 am

    OMG!~ Years of playing Mafia Wars has paid off!
    You’re making a killing… .

    Your comment is awaiting moderation.

    A fella who hasn’t learned to spell his own name (Stillgotshoeosn?) makes silly predictions, posts worse results than you’d find at any racetrack… and is protected because he’s a property bear?

    Gotta laugh!~ :D

  • 812 Stillgotshoeson // Oct 10, 2012 at 9:16 pm

    BP // Oct 10, 2012 at 8:09 pm

    In the interests of calling-to-account some of the outrageous punts made in this forum, let’s review just what has been ‘moderated’:

    BP // Oct 10, 2012 at 8:40 am

    Shoes: “…people who know little about shares or investing in shares should not be posting in a share thread…”

    Some of the shares are up, some of them are down. On balance it is a break even. I could have cheated and picked the best and say they were the trades and post them later. This is being played by the numbers, what it is is what it is.

    No anonymity, no vague references to shares in a wonderful nirvana, near beaches and about 10Km from the holy father. Up there for all to see.

    What are you going to do next year when it is up 50%, 60% or more?

    What am I going to do if it’s not? Keep going to work, keep investing.

    What are you going to do WHEN the housing market continues to decline?
    I know exactly what you are going to do…

    Biker Pete “The good lady FA and I decided we had enough property and as we are getting on we sold down to just 5 properties, easier to manage and gives us more leisure time. Sold out at just the right time too, prices have come down a bit since we sold. Nothing like good planning to get where you want to be.”

    May I suggest getting yourself one of these as well, you’re current one is starting to get a little worn out.

    http://www.bunnings.com.au/products_product_d-handle-spade_2237.aspx

    ASX Sharemarket Game

    Your ranking (at close 09/10)
    National ranking 126 of 8528
    State ranking 35 of 1962

    Not a bad ranking for someone who has no expertise in shares.

    Greg, Please at least leave it up long enough for him to read.

  • 813 Greg Atkinson // Oct 10, 2012 at 10:50 pm

    BP I don’t care if he/she is a property bear or not as long as they stay on the topic. As I mentioned I have better things to do thanks so please stay on topic and re-check the moderation guidelines if needed.

  • 814 ozze_dollar // Dec 3, 2012 at 1:08 pm

    Whats going on with LEP. I thought they were to issue the new shares today.I am os at present so a bit out of touch.

  • 815 Greg Atkinson // Dec 3, 2012 at 6:38 pm

    I can’t see any updates on the ASX website so I am not sure what is happening sorry.

  • 816 Stillgotshoeson // Dec 8, 2012 at 6:05 pm

    100k Portfolio

    SBM 6100 @ $1.695 $10339
    PRU 3900 @ $2.30 $8970
    FML 225000 @ $.034 $7650
    BPT 7500 @ $1.435 $10762
    CDY 500000 $.015 $7500
    BKP 714000 @ $.006 $4284
    EVN 7370 @ $1.77 $13044
    PIO 60000 @.025 $1500
    AYN 200000 @ .039 $7800

    Shares $71849
    11Kg Silver $11620
    Cash $109
    Portfolio $83578

    There have been no trades made during my absence. BKP took a big dive on poor drill results. Still retaining them though. Drilling next year.

    Precious metal miners generally have underperformed this year.
    Fundamental reasons for holding them in my opinion have not altered so will stay the course into 2013 with an expectation of some improvement.

  • 817 Greg Atkinson // Dec 10, 2012 at 10:06 am

    That reminds me to update the Shareswatch Random Portfolio! I suspect the mining related stocks in that portfolio have also been knocked around a bit.

    My pick at the start of the year was for the All Ords/ASX 200 to close around 5000 which at the time was a very modest call, now it looks ambitious. Still there are plenty of trading days left until the end of the year…maybe if someone does me a favour and calls an election the market might rally up to where I need it to be! ;)

  • 818 Stillgotshoeson // Dec 11, 2012 at 11:53 pm

    My guess was 3800 to 4200 from memory on the “predictions’ thread.

    Part of me is surprised the market is holding up as well as it is in the face of poor numbers coming out in the data.

    Another part is not so surprised that the market is holding up..

    My data is telling me around March 12 things will not be very good on the ASX.

    As I pointed out to Plornt, we are in unknown territory and curveballs can throw out our “systems” so I could well be wrong.

  • 819 Lachlan // Dec 12, 2012 at 5:06 am

    Can’t recall if I made a call Shoes…I make so many ;)

    Worst call so far for me was TLS…holding off…should have bought that with both hands but I was waiting for another 10c of discounting.

    If we move toward 5000 on the indexes I will think a decent sell off (min 500 points/max 1400 or so) will happen again. Maybe after a fake out above.

  • 820 Leigh // Dec 12, 2012 at 3:38 pm

    Lachlan, TLS has taken a 10c haircut in the past two days so perhaps now is a good time to buy. It is still returning 6.4%.

    Overall I still believe the market is cheap, the only stand out performer I am aware of is CBA, they hit 61.29 today, under 70c from their high in Nov 07 and well over double their low in Jan 09. None of the other big four have done nearly as well.

  • 821 Greg Atkinson // Dec 13, 2012 at 9:32 am

    I had my eye on TLS shares when they were around $3.11 but was waiting for them to dip…what a silly boy. It just goes to show that timing the market is very tricky. I should have snapped up some shares when I wrote this: Stockwatch: Qantas (QAN), Telstra (TLS) and Onesteel (OST) back in November 2011.

    No use spotting a trend when you lack the conviction to do anything about it!

    Anyway I am still waiting for the market to fall-back as it seems overdue for a correction to me. But then again, I had the same strategy for TLS shares and look where that got me! :)

  • 822 Frank // Dec 13, 2012 at 10:38 am

    I have a Love Hate relationship with TLS, hated them for 10 years, love them now, will probably hate them again soon! They are an accumulation share for me and have a reasonable yield.

    Qantas are a cancer on my portfolio, I am happy that they are a small part of the value and volume and my losses are fairly insignificant. But I cant bring myself to sell them and I cant for the life of me understand why!

    Onesteel I have been involved with professionally for a very large part of my now completed career (back to the Tubemakers days) and there are a wealth of problems that will impact the profitability of this sector for years to come. Hills are looking to divest Orrcon, Bluescope are a basket case, our steel industry is not looking like coming back anytime soon I am afraid.

  • 823 Greg Atkinson // Dec 14, 2012 at 8:16 am

    Frank I sold out of Qantas years ago just before the ill-fated takeover bid. I sold way before their share price peaked but I also sold well before they slumped down to where they are now. It very hard (almost impossible) to get the exactly right so I guess I did okay from that trade.

    As for Onesteel, it would seem very hard for them to compete again the Asian steelmakers and I guess they will eventually be taken over by an Asian steelmaker don’t you think?

    As for the overall stock market – well the Baltic Dry Index is of today below 800.00 and is down -54.03% this year. Many people will say that doesn’t matter but as I have been saying for years it does. Our stock market will not enter a long term rally phase with the BDI so weak and if the BDI continues to fall, then a significant correction across the ASX All Ords/ASX 200 is very likely in my opinion.

  • 824 Frank // Dec 14, 2012 at 10:19 am

    Hi Greg,

    Not sure if Onesteel will be sold to an Asian steel maker, a more likely outcome would be they go the way of Fisher & Paykell, Electrolux etc and move offshore prior to disappearing altogether. Be sad when it happens, but I think it is the most likely outcome.

    QAN are one of those romantic shares I hold out of misguided loyalty and a desire to see it do good. The only thing I can compare it to is being a member of Richmond!

    The ASX performance, mate suck your thumb and chase the wind really. I think that the number of quality companies undertaking share buy backs might be inflating the market a little, maybe not.

    I cant see a 10% correction unless something massive happens in Europe or Labor are returned. Equally I cant see it cracking through 5000 which I still think is fair representative value

  • 825 Frank // Dec 18, 2012 at 4:18 pm

    Cant see a correction taking the market back to 4,000 points this year Greg, perhaps if it stays above 4,500 then there is a solid case to be made for a move toward or just through 5,000 though and with an election coming and a return of some business confidence with the outcome, perhaps 5,000 will become the new floor?

  • 826 Stillgotshoeson // Jan 1, 2013 at 1:52 pm

    100k Portfolio

    SBM 6100 @ $1.445 $8814
    PRU 3900 @ $2.10 $8190
    FML 225000 @ $.031 $6975
    BPT 7500 @ $1.48 $11100
    CDY 500000 $.015 $7500
    BKP 714000 @ $.006 $4284
    EVN 7370 @ $1.71 $12602
    PIO 60000 @.027 $1620
    AYN 200000 @ .036 $7200
    Shares $68285
    11Kg Silver $10778
    Cash $109
    Portfolio $79172

    Again no trades have been made in the interim period since last update.

  • 827 Greg Atkinson // Jan 2, 2013 at 3:22 pm

    Well the All Ords finished up around 12% and the correction I was expecting in December didn’t arrive. Santa 1 Greg 0. I have posted a review of 2012 today: ASX All Ordinaries Index 2012 charts review

  • 828 Ned S // Jan 2, 2013 at 11:16 pm

    It’s nice to see shares have a good run. Things certainly have been sounding pretty ordinary of late.

  • 829 Lachlan // Jan 3, 2013 at 4:50 am

    Haven’t they what Ned? My inflation tsunami just never seems to come ;)

    ok bar the one happening on CB balance sheets. 13T reserves at present and gaining. Not that I am saying inflation is good for the real economy either when considering the process full circle. Just that I am betting on nominal outcomes not real.

    Greg my prognosis although allowing for a rally to 4800/5000 also includes a sell off from there and as I have said many times will be “possible” to go down to 3600…while Shoes had lower targets again. I guess am just putting out my idea of the possibilities these days because the markets are so confusing that nobody can pick trends…we are all looking a bit confused it seems. This is the problem with extend and pretend while it exists. It temporarily breaks the link with fundamentals and creates apathy and confusion.

  • 830 Ned S // Jan 3, 2013 at 8:51 am

    From my limited understanding of shares, one would not have wanted to be short anything yesterday Lachlan. I can only imagine that a bunch of traders got hurt?

  • 831 Greg Atkinson // Jan 9, 2013 at 10:08 am

    I just posted my outlook for the Australian stock here for 2013 here If you wish to add your prediction for 2013 please leave it under that post so we can see who was close at the end of the year!

  • 832 Stillgotshoeson // Jan 11, 2013 at 2:44 pm

    Matthew, In response to your comment in the predictions thread.
    I respond here as not to bog down the “predictions” thread with discussion that should be here.

    Why can the ASX not fall 43%? There are many who thought it could not fall 54% from peak, yet there are some whom are quick to remind contributors to this and other forums that it in fact did.

    The Spain/Greece reference is not “Australia is going to be like Spain/Greece” statement, it is highlighting that the European side of the crisis is far from over and we are in a global economy. What happens over there impacts the Australian economy, directly and indirectly through its impact on other countries economies,

    At the start of the GFC the world economy was a new born baby, screaming and seeking food. The economy nearly 5 years later is still sucking from the mothers breast and lacks the confidence to leave its mothers breast and go to the cupboard and feed itself.

    The still questionable growth figures we have seen in some parts of the world economy (including Australia) are built on the back of large stimulus spending. I fail to see any self sustainable economies yet. Maybe Iceland which took a different approach and told the banks to get stuffed and are now in a much better position.

    The debt load is still too high and losses will occur. Australian national debt is quite low compared to other countries but private debt is at I believe unsustainable levels.

    As risk continues to rise, investors will be seeking more reward for the risks (bond market specifically here) and will demand higher returns. This is going to add to the cost of funds and even if central bank rates are at zero percent mortgage rates will begin to rise again. As early as 2nd half of this year is not out of the question.

    You believe governments have it all under control and will keep things balanced and all will be ok in the future as we muddle through this.

    I think it is going to get worse before it gets better. Australia is in a good position to be a prosperous nation again and recovery will occur and all will be good again, until the next crisis. Does not change my point of view than in the short to medium term, people are going to be hurt financially as this crisis continues to unfold.

  • 833 Matthew // Jan 11, 2013 at 10:04 pm

    Shoes I respect your opinion, and more importantly the fact you are willing to put numbers to your comments and beliefs as opposed to motherhood statments and cookie cut rubbish.

    I am not saying that you wont be right, I am simply saying that I can not see it happening.

    I think many people could see what unfolded in the GFC as reasonable, but to suggest that our resiliance real or implied since is grounds for an equal crash despite the reoprted numbers of our market leaders, I just dont see it being that bad.

    Dont get me wrong, at the height of the boom I was one of the guys saying this can not last for ever, recommending people take conservatice approaches and reducing risk. A 20% pa CAGR is not sustainable, all “good” things come to an end.

    As risks rise, investors will indeed seek more return for their risk, but the normal relative safe haven is almost worthless (cash deposits) so the risk averse investor appears to be seeking the least risky, normal return. This is likely to be shares, or property given the subdued nature of both markets for a prolonged period.

    Shoes, I take offence to being called a bull. I think I am a realist and call things as I see them. If I thought property was going to fall, or shares, I would say so. I just dont think this is the case.

    Again, I just see another boring, unspectacular year in our economy. There is still money to be made though, you just need to find the right spots.

  • 834 Stillgotshoeson // Jan 16, 2013 at 3:51 pm

    100k Portfolio

    SBM 6100 @ $1.38 $8418
    PRU 3900 @ $2.12 $8268
    FML 225000 @ $.036 $8100
    BPT 7500 @ $1.50 $11250
    CDY 500000 $.021 $10500
    BKP 714000 @ $.006 $4284
    EVN 7370 @ $1.65 $12160
    PIO 60000 @.031 $1860
    AYN 200000 @ .042 $8400
    Shares $73240
    11Kg Silver $11000
    Cash $109
    Portfolio $84349

    Again no trades have been made in the interim period since last update.

    After a lacklustre year there are tentative signs that the precious metal stocks that got hammered last year may recover that lost ground and move up from here.

  • 835 Greg Atkinson // Jan 18, 2013 at 6:59 pm

    Well the Santa Rally has morphed into a New Year Rally as well. Could this be the start of a long bull market run? Maybe..and perhaps that started a while back but I still feel a pretty significant correction is going to hit the All Ords/ASX 200.

    My strategy for now is to take some profits in cases where I need to rebalance the portfolio and then wait for an entry point to pop up for some stocks I am watching.

  • 836 Lachlan // Jan 19, 2013 at 5:31 am

    I am predicting an intermediate term correction on the ASX Greg but it may be a shallow one. As I have said is likely approaching 4800/5000.
    Gold has share market correlations and de-correlations at times. I feel that the gold and silver bulls are generally thinking the bottom is in and although I am bullish long term I feel there will be one more grand slam down on these metals starting very shortly (1-3 days). Gold in USD maybe to 1595 and in AUDs to 1540 odd. I am thinking that when gold reaches these levels the ASX will begin to top out for the intermediate term. Targets would be roughly 4400 imo but failing that 4000 and 3600.

    If this plays out I will watch the downside action. According to the nature of that action I may begin to predict a breakout above 5000 and therefore the onset of a resolution to the debt crisis through a price inflation event. That may not necessarily be a free market emanation like global deflation or hyperinflation either. I have an alternative thesis which would be a more controlled event with maybe just some corporate and maybe one or two currency casualties. I would not discount the possibility. After all, debt:GDP levels are at unheard of levels and still the bond market rallies. Libor is fixed centrally, has been for years. Apparently the major finance centres love this game!

  • 837 Lachlan // Jan 19, 2013 at 5:41 am

    Some other things to consider.
    *In history the collapse of major power structures always is yearned for by many of the people but drags on longer than expected. I am not saying it wont happen. But when. Could be decades more.
    *Technological gains buffer living standards. For example there are robots that will reduce dispatch workers (transport) by 300%.

    Anyhow I am just keeping an open mind. Black and white gets us crucified. To own “some” shares and to at least consider a bull market is a fair idea.

  • 838 Stillgotshoeson // Jan 19, 2013 at 5:53 pm

    I’m still looking to see some pull back on the ASX early to mid March. Not the big new low pull back, not yet anyway. That is still further away.

    I think any pull back in the precious metals will be shortlived and the next bull run will commence for them too.

    Europe is still a mess, talk of Greece asking for more money as early as next year.
    I have doubts on the sustainability of the current improvement in the US economy and doubts on ours, with the plethora of bad news in Australia.

    More government intervention will stem the tide for a little longer.
    They will lose control at some point. Governments always do.

  • 839 Lachlan // Jan 19, 2013 at 7:25 pm

    “They will lose control at some point. Governments always do.”

    No doubt Shoes. I only question the time frames. In reality I do not think anyone can pick the true end of this super-power structure based on financial data. Not until the end it is imminent.

    As for gold. Any decline will be a rapid shake-out and recovery according to my theory. Little time to buy. Actually the US mint closed shop yesterday for ten days so unfortunate for the yanks if this does play out.

  • 840 Greg Atkinson // Jan 23, 2013 at 1:35 pm

    Well the All Ords & ASX 200 seems to be pausing around the 4800 level now. I wonder if the next major move will be up or down?

  • 841 Stillgotshoeson // Jan 23, 2013 at 4:05 pm

    It is not the getting to 5000 that will surprise me.
    Holding and then continuing ever onwards that will surprise me with out fall in the near term.

    I still expect more significant falls in the short to medium term as I still have doubts the world economy is able to remain stable much less grow with out continued government stimuls/support.

  • 842 Greg Atkinson // Jan 26, 2013 at 11:20 am

    This run is reminding me of the bounce from the low of 2009 during which the market rose from deeps of despair to around 5000 in less than a year. This makes me wonder if:

    A) I shouldn’t worry so much since the global economy is in theory in better shape than it was back then or;

    B) Worry because the global economy is actually just on a stimulus high and many problems are being dimply being parked in the too-hard basket for now.

    Technically speaking the All Ords and ASX 200 are in bull market territory now but I just don’t feel bullish.

  • 843 Stillgotshoeson // Jan 26, 2013 at 12:34 pm

    Lock in B for me Greg.

    DOW is up on monies chasing better returns than the low interest rates available.
    Commodities are up on stimulus measure not self sustained growth numbers.

    Euro zone is still a mess.

    Will be interesting to see Swans May budget with tax receipts down.

    Debt ceiling issues in the USA will surface again in a couple of months.

    I am still wary of the run up we have had.

  • 844 Ned S // Jan 26, 2013 at 12:45 pm

    Read a comment recently that went along the lines that it seems a bit strange the Dow is up 12% in a year when the US economy hasn’t exactly been going great. Which caused me to look at the FTSE 250 – Yep, it’s up for the year as well (21% ?????) – Despite the fact the Brits are looking at a triple dip recession and even worse growth than in the Great Depression apparently??? :

    http://uk.finance.yahoo.com/echarts?s=%5EFTMC#symbol=^ftmc;range=1y;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

    Glad it’s you blokes trying to make sense of stock markets – Way too hard for my head.

    About the only comment I can venture is that just maybe such things happen when you trash interest rates and print lots of money?

  • 845 Stillgotshoeson // Jan 26, 2013 at 12:45 pm

    100k Portfolio

    SBM 6100 @ $1.53 $9333
    PRU 3900 @ $1.905 $7429
    FML 225000 @ $.032 $7200
    BPT 7500 @ $1.38 $10350
    CDY 500000 $.022 $11000
    BKP 714000 @ $.008 $5712
    EVN 7370 @ $1.635 $12050
    PIO 60000 @.027 $1620
    AYN 200000 @ .043 $8600
    Shares $73294
    11Kg Silver $11217
    Cash $109
    Portfolio $84620

    Again no trades have been made in the interim period since last update.

  • 846 Ned S // Jan 26, 2013 at 6:17 pm

    Just a very general comment but does anyone else out there think Michael Pascoe is a bit of a dummy not worth reading (with me also feeling the same about Jessica Irvine) ?

  • 847 Greg Atkinson // Jan 26, 2013 at 8:53 pm

    Ned I don’t pay much attention to Pascoe, Irvine or Gittens.

    In regards to the stock market and trying to make sense out of it…well at the moment I am simply sitting back and watching events unfold. I haven’t done much buying for a while and have simply taken some minor profits when they have popped up. All in all I would class my trading status as inactive.

  • 848 frogmorton // Jan 26, 2013 at 11:25 pm

    Nor anyone whose opinion differs to my own… ;)

  • 849 Matthew // Jan 29, 2013 at 11:48 pm

    Nor should you Greg.

    You have another here who does, after all he quoted Gittins understudy as a credible source of commentary.

    For what it is worth, I place my focus on the actions of the market, not the people talking about the market with vested interest.

    As it is, from an ASX point of view, I am putting one size 3 bear shoe on, I need to see a correction of perhaps 300 points soon. Nothing major, but the profit takers will step in eventually our of dividend season

  • 850 Matthew // Jan 29, 2013 at 11:51 pm

    Ned Jessica Irvine is a very amusing economic commentator, I really quite enjoy reading her work, I just wouldnt act on her recommendations.

    Not discounting her education, if she was to start publishing work in the mid 90′s I am quite sure every article would have the rider “For Dummies”.

    She is like Scott Pape to me, good to read, good to ignore

  • 851 Lachlan // Jan 30, 2013 at 6:27 pm

    Just got my internet back after being flooded on the farm here by that ex cyclone on the Oz east coast. Hope Ned had his floaties down in the flat country ;)

    PMs are into their sell off now I see and the XJO has accelerated even faster to the upside so there should be a reversal soon for both still. I am not so sure AUD gold will go lower than about 1577 now because its action has been improved…. although USD gold still looks good for a lower dip. I think the Oz gold shares are in for a final dip now also with the small caps taking the brunt…which would be as usual. Those small caps will then be back to 2008 GFC levels when they bottomed 6 months ahead of the XJO. Obviously I never expected to see that. The big producers generally fared better.
    Things are coming together then.

    It will be interesting next to see where the XJO finds resistance and if it fakes a move decidedly through the 5000 mark to capture some mad bulls.

  • 852 Stillgotshoeson // Jan 30, 2013 at 7:52 pm

    Hope Ned and yourself were not hit too bad by it all.

    Watching with interest the ASX, not a buyer but might look to unload a couple of stocks.

    Have regidtered for the next ASX Sharegame starting mid Feb. Last one I did Ok, one before not as good.

    Market is going to be hard to judge over the next few months.
    Still thinking a sell off early to mid March likely.

    Will just see how it plays out.
    If the AUD breaks 105 YEN I might be a buyer of some Japanese currency.

  • 853 Lachlan // Jan 31, 2013 at 6:27 am

    Thanks Shoes. The house I reside in sits on the end of a spur so it was never at much threat but I have not seen so much water come up so quickly. Like a flash flood. At the peak I felt like I lived on a canal estate.
    Yen play sounds interesting. As you know i am a long term AUD bull at least until we have a significant leg higher from this point or after a quick pull back.
    I might be tempted to buy the share index next time I feel like diversifying out of my business. Maybe at 4400 if everything else looks fine. I am really keen to get a small fertile farm block soon. I will base my residence and business there. Also handy for tax and a fair store of value. They are moving in the last six months. I know because I have heaps of them stored on my favourites and more than half have just gone whereas they used to stay there forever. Have a big deal on the table now like nothing I have ever seen before and if that goes through we’ll see. Don’t want to count chickens yet otherwise.
    Still have the little block I bought too which I intend to put a shed a on for grass seed storage. I resisted buying the next door lot although they offered a 40% discount. Lovely blocks but in too quiet area for the current market

  • 854 Greg Atkinson // Feb 25, 2013 at 9:44 am

    Well the market is back up in the range I though was fair value a few years ago..i.e. between 4800-5200.

    The one big drag that I guessed was shaving 10% off the All Ords/ASX 200 was the political chaos in Canberra and now that an election has been called I reckon the markets are saying farewell Gillard & the ALP.

    So what has given the markets bounce?

    1. The market was oversold in June 2012 when the All Ords/ASX 200 was around 4100.

    2. The Canberra chaos factor has been removed and that has added around 10%.

    3. Lower interest rates have lured investors back into stocks.

    4. China – apparently all is well there again as far as the economy is concerned but as regular readers know, I don’t buy into that view.

    I have also outlined a few other points worth considering here: The ASX All Ordinaries March Towards 5000 – Been There, Done That

  • 855 Stillgotshoeson // Mar 5, 2013 at 8:17 pm

    100k Portfolio

    SBM 6100 @ $1.13 $6893
    PRU 3900 @ $1.59 $6201
    FML 225000 @ $.025 $5625
    BPT 7500 @ $1.42 $10650
    CDY 500000 $.037 $18500
    BKP 714000 @ $.006 $5712
    EVN 7370 @ $1.33 $9812
    PIO 60000 @.027 $1620
    AYN 200000 @ .025 $5000
    Shares $70013
    11Kg Silver @ $951.91 $10471
    Cash $109
    Portfolio $80593

    Again no trades have been made in the interim period since last update.

  • 856 Greg Atkinson // Mar 19, 2013 at 1:48 pm

    What I am watching for now is if the All Ords/ASX 200 will head below 5000 and if/when BHP dips below $30.

    I have been expecting a 10% or so correction for a while and if that happens it would send the market to around 4800.

    If the market holds there then that will give me some confidence we can post some gains this year. If it fall much below that level then we could see the Australian stock market struggle this year.

    Also I am keeping an eye on the Chinese steel makers and the Baltic Dry Index.

  • 857 Stillgotshoeson // Mar 20, 2013 at 3:42 pm

    100k Portfolio

    AYN 200000 @ .017 $3400*
    BKP 714000 @ $.006 $5712
    BPT 7500 @ $1.375 $10312
    CDY 500000 $.038 $19000*
    EVN 7370 @ $1.47 $10834
    FML 1225560 @ $.023 $28188
    PIO 60000 @.030 $1800
    PRU 3900 @ $1.87 $7293
    SBM 6100 @ $1.27 $7747

    Shares $71850
    11Kg Silver @ $941.30 $10354
    Cash $493
    BPT Dividend $56 included.
    Portfolio $82697

    Sold AYN $3380*
    Sold CDY $18980*
    Total $22360

    Bought FML 1000560 @$0.022 $22032

    3:12:32 PM 0.022 491,560 10,814.320
    3:12:32 PM 0.022 509,000 11,198.000

  • 858 Stillgotshoeson // Mar 20, 2013 at 3:48 pm

    Greg @ 859

    I see support levels @ 4750 then @ 4500 and @ 4250

    Below 4000 means confidence is lost and last stop will be 3750 before we test new GFC lows. I do not see that happening this year although the situation in Europe is interesting to say the least. Contagion?

    Some are saying $70 a tonne for Iron Ore in the near future…

  • 859 Biker // Mar 20, 2013 at 4:02 pm

    Some are saying $1100 per ounce for gold in the near future.

    (Crystal balls, however, are cheap!~)

  • 860 Greg Atkinson // Mar 20, 2013 at 5:13 pm

    I think at this stage we may not go much below 4800 unless the banks roll over.

    As for iron ore, all I can say is that I have been bearish regarding iron ore (and coal) for some time and I am also not keen on mining stocks at the moment.

    I expect the commodities indexes to head lower over the months ahead and I see more downside risks then upside.

    A huge amount of money has been pumped into mining projects over the last few years which has ramped up supply to deal with uber-bullish demand levels which just doesn’t exist. If it did the BDI would not be stuck in a rut and shipping companies would not be scrapping bulk ore carriers in numbers not seen for many years.

  • 861 Stillgotshoeson // Mar 20, 2013 at 11:49 pm

    Biker // Mar 20, 2013 at 4:02 pm

    _Some are saying $1100 per ounce for gold in the near future._

    I hope it does, will give me a chance to buy a lot more at a good price, impact on the Australian economy will be quite low.. Sure to be sure nowhere as problematic as iron ore @ $70 a tonne would be.

  • 862 Biker // Mar 21, 2013 at 8:08 am

    Yes, these little dips certainly allow us to benefit, don’t they, Shoes?

  • 863 Greg Atkinson // Apr 3, 2013 at 1:02 pm

    Latest review of where the Australian stock market might be heading posted a few days ago: What could be the next move for the ASX All Ordinaries Index?

    As of today the All Ords/ASX 200 are in the 4900-5000 range but both could test the 4800 support level this week.

  • 864 Stillgotshoeson // Apr 16, 2013 at 2:04 pm

    The 100k Portfolio has not vanished…

    100k Portfolio

    BKP 714000 @ $0.005 $3570
    BPT 7500 @ $1.39 $10425
    EVN 7370 @ $1.015 $7481
    FML 1225560 @ $0.015 $18383
    PIO 60000 @$0.025 $1500
    PRU 3900 @ $1.415 $5519
    SBM 6100 @ $0.852 $5197

    Shares $52012
    11Kg Silver @ $714.9 $7864
    Cash $493

    Total $60369

    As expected the last few days of the precious metal prices slumping has been a big hit in a very short time.

  • 865 Greg Atkinson // Apr 16, 2013 at 2:41 pm

    Sometimes Still it is best to ignore the ramblings of those who put few ideas forward but snipe from the sidelines.

    Certainly the precious metals rout is causing some grief. Personally I thought gold would get hit when it looked like Ben was about to wind back QE, but obviously this is not the case..or at least I don’t think it is.

  • 866 Biker // Apr 16, 2013 at 4:25 pm

    Comment 27 February 2010:

    Gold Skyrockets to $6000 an Ounce $498000 ( I think $2400 or so)
    My guess on the share price is right.. $970000
    My guess is Half right $485000
    Somewhere in between (prolly closer to reality.. $750000)
    I put my money where my mouth is, and took the miners…
    You go ahead and buy physical gold if you wish..
    (Yet by 2012 he was buying kilos of the stuff… )

    Comment 4 March 2010:

    400000 CTO @ .085 $34000
    400000 CTO @ .10 $40000

    hmmm not bad return on a $34000 house in barely 2 weeks
    Yep I am so I decided to by houses..

  • 867 Biker // Apr 16, 2013 at 4:58 pm

    The original portfolio:

    “My Gold Mininer positions are..

    Citigold 400000 shares @8.5 cents
    Lihir Gold 10000 @$2.98 (down a bit at the moment)
    Gold One 100000 shares @28.5 cents

    Over the next 5 years I expect Citigold to hit $1.50
    Lihir to hit around $7
    Gold One to go around $3″

    Update, please.

  • 868 Stillgotshoeson // Apr 16, 2013 at 7:27 pm

    “Over the next 5 years”

    Come back then…

  • 869 Biker // Apr 16, 2013 at 10:04 pm

    You’re running out of time, Stillgotshoe-son. You’re supposed to be retired next year, living off these immense profits… .

    By my count, you’re also running out of capital. ;)

  • 870 Stillgotshoeson // Apr 16, 2013 at 11:15 pm

    As I have said before if things go slightly off plan and I retire at 50 instead, so be it…

    I’m still working, money coming in every month, dividend paying shares in the portfolio as well and not ons cent in the portfolio I need to access for any reason.

    Using the very same argument you put forward on property owners in regards to a falling property price environment.. don’t sell.. They still have their property.. I still have my shares, they will go up again.

    Some people, like yourself can not stomach share investment due to the volatility.. they see red arrows on their trading page and think.. “oh noes, I have lost all this money” with out stopping to think of the fundamentals.

    Gold is up $24.70 (1.83%) at time of writing this and Silver $0.72 (3.17%)

    (Edited by Admin)

  • 871 Greg Atkinson // Apr 17, 2013 at 11:39 am

    Some people just can’t grasp the concept of long term investing Still..best to move on which leads me to thinking about where the Australian stock market will be at the end of the year.

    I see no reason to change my original forecast from January and still expect the All Ords/ASX 200 to finish in the 4800-5200 range.

    But could we see some major swings out of that range that will be worth jumping into?

  • 872 Stillgotshoeson // Apr 17, 2013 at 12:24 pm

    The coffee shop and dividends are netting me over 30k a year which is higher than the Old age pension so I am already doing better than many pensioners. Certainly not running out of capital. ;)

    “But could we see some major swings out of that range that will be worth jumping into?”

    I think we will see continued volatility for some time Greg.

    The “we could have 5 more years of this” comment I made last year or the year before is looking more and more likely I think with the continued trouble abroad and our own brewing here,

    Continued budget shortfalls, a good chance our car manufacturing industry vanishing. More resources coming online in other (cheaper) countries…

    (Edited by Admin)

  • 873 Matthew // Apr 17, 2013 at 2:32 pm

    Many things confuse me Greg, one of them is people aiming to retire in their 40′s. I have a mate determined to retire at 40, he has made a string of stupid high risk financial decisions trying to get there and at the age of 35 with 5 years left, he needs to generate around $1.5m per annum in surplus cash per annum in order to get there (pay his debts and accumulate adequate wealth)…… I am confident he will be working at 65!

    I think 3-5 years of low growth in Australia is a real possibility. The glass half empty brigade see this as an opportunity to cry death, destruction and misery. I see it as a once in a generation opportunity accumulate and get in position before the next very real upswing in the markets (share & property).

    I genuinely anticipate an 85% increase in my net wealth over the next 7 years as a result of accumulations I have made / contintue to make over the past 3 years.

    On that I could very comfortably retire at 45, but I will probably keep working until 60, after all there is only so much golf a man can play and so many days to hunt fish……

  • 874 Matthew // Apr 17, 2013 at 2:48 pm

    I must be missing something here, I am not having a go Shoes, I am trying to follow this but admit I have only read this page of comments.

    If I read correctly you purchased in 2010:

    CitiGold for 8.5c and predicted it would go to $1.50 in 5 years (trading today at 5.4c)

    Gold One at 28.5c and predicted it would for to $3 (trading at 17.5c today)

    You are also saying that the market could get down to (from memory) 3,000 points in the next 3 years.

    If I am reading this right, you obviously need to abandon one of these predictions? I cant see how a 40% crash in the wider market will support a 3000% increase in what is on face value a speculative share in the same timeframe?

    There is a bit of Wayne Swan economics to these 2 principles if I am interpreting it correctly.

    If you still think these shares are going to meet your prediction, then I am going to do some reasearch into them and look to buy a few for the ride, but you dont see a Sandfire on the ASX everyday…

  • 875 frogmorton // Apr 17, 2013 at 9:31 pm

    While a return of that magnitude seems unlikely, Mathew, Stillgotshoeson has attained high status Australia-wide:

    Sharegame update:

    Your ranking (at close 09/10)
    National ranking 126 of 8528
    State ranking 35 of 1962

  • 876 Matthew // Apr 18, 2013 at 1:46 pm

    My question does not relate to a mans ability to participate in an online investing game against 0.04% of the population with differing abilities, education or enthusiasm 3 years ago, I am simply trying to understand how two fundamentally different market opinions can simultaneously co-exist, and specifically if he still believes in the “price peaks” predicted in those specific stocks.

    There was an article in the business section of yesterdays West basically saying low cap gold stocks will disappear into the ether in the coming weeks / months with some having less than $100k in capital and one only $2k in the bank, and with the low prices no appetite from investors to wade into any capital raisings.

    I havent had the time to do any research as yet, but if these companies are in that space, then their future does not look that rosey.

  • 877 frogmorton // Apr 18, 2013 at 3:01 pm

    Intrigued by the figures you presented, I glanced through some of Stillgotshoesons targets.

    He is ambitious to be expecting FML to reach 15c. He appears to already be in the red around seven thousand dollars on that trade alone, having paid $.054.

  • 878 frogmorton // Apr 18, 2013 at 3:16 pm

    From its current value, FML would need to appreciate 940X to achieve that target.

  • 879 Biker // Apr 18, 2013 at 3:51 pm

    Matthew: “…one only $2k in the bank…”

    Hell’s Bells, Shoes. Race in and _make_ them give it back!~

  • 880 Stillgotshoeson // Apr 18, 2013 at 7:41 pm

    Biker aka frogmorton,

    “frogmorton // Apr 18, 2013 at 3:16 pm

    From its current value, FML would need to appreciate 940X to achieve that target.”

    “frogmorton // Apr 18, 2013 at 3:01 pm

    Intrigued by the figures you presented, I glanced through some of Stillgotshoesons targets.

    He is ambitious to be expecting FML to reach 15c. He appears to already be in the red around seven thousand dollars on that trade alone, having paid $.054.”

    Average buy price for FML in the Portfolio is $0.0263 not $0.054

    They only need to go up 9.4 times current price to get to $0.15 not 940X

    If they achieve this before the end of 2015 (5 years) the profit will be circa $150000 before tax, 50% tax free. So CGT will be about $20k so an after tax profit of $130000k approx.

    The portfolio is actually about $12k down on that trade..

  • 881 Greg Atkinson // Apr 18, 2013 at 8:07 pm

    …and the topic of this discussion is “Australian Stock Market Outlook”.

    Stillgotshoeson posts portfolio updates which reflect how the market is going…personally I find them interesting.

    There is also disclaimer at the top of the page which anyone over about the age of ten could comprehend – so I am not sure why a few people seem to think they add value by just sniping from the sidelines.

    Anyway back onto the topic at hand…the miners got hit hard again today with BHP just holding above $30. So over the next few weeks we may seen an entry point pop up for braver investors who feel like venturing into some blue-chip mining stocks.

  • 882 Lachlan // Apr 18, 2013 at 8:22 pm

    It seems crazy that smaller cap gold shares which have the wind of the gold bull market behind them the last 10 years have been going down for 15 years or more. I hope they don’t go out the back door but even though my shares are down terribly I bought them in the bowels of a bear market to begin with. They were historically very cheap then even though they have smashed further since. They are only small part of my portfolio and I bought them to hold to the bitter end…no good changing your mind when they are this cheap. Sell low? They are long term bets like everything else. Market timing might be fun but I can’t make a living out of it…in this current day and age. It’s so volatile and divorced from reality no matter where you look. eg Abe says lets target 2% and gold goes down 10%.

    Coffee shop passive income sounds like a good deal Shoes.

  • 883 Matthew // Apr 18, 2013 at 9:52 pm

    Greg: “so I am not sure why a few people seem to think they add value by just sniping from the sidelines.”

    If that was aimed at me Greg that was certainly not my intention. I have a clear issue with the extremist idiocy of one of your posters who drew me to this site, and I am bound to continue to refute him in the future, but my question above is genuine and I really would like an answer.

    I have said before that I have no interest in Gold. Given I hold significant supply agreements with KCGM, Barrick, Newmont and BHPB Olympic Dam for some rason it has never entered my portfolio. In what is an otherwise balanced portfolio it is the glaring ommission, and with the recent correction I am considering an entry.

    As to the question I posed, an analogy if I may. Almost every Saturday no matter where I am in the world you will find me at the track, and the most common place you will find me is the Bookies ring. If a guy tips me a horse paying $50 and follows that up with a sizeable bet of his own on it, I will grab the form guide and have a look. If it has finished 30 lengths last its past 4 starts I will laugh, back the horse I have picked and go grab a beer. If the form looks reasonable I will have a bet on it with everything to gain and comparatively little to lose.

    My question to Shoes is just this. He has said that the market could go 3,000, and he has said these shares could be that $50 horse. I just want to know if he still thinks they will get there. If he does, I will pull out the form guide and do some research. If he does not, I am a busy man, I will stick to the $3 favourite and not waste my time reading.

  • 884 Stillgotshoeson // Apr 19, 2013 at 12:36 pm

    Matthew // Apr 18, 2013 at 9:52 pm

    “My question to Shoes is just this. He has said that the market could go 3,000, and he has said these shares could be that $50 horse. I just want to know if he still thinks they will get there. If he does, I will pull out the form guide and do some research. If he does not, I am a busy man, I will stick to the $3 favourite and not waste my time reading.”

    Yes, I do believe that the ASX going to 3000 or below is still a possibility whilst this global economic situation continues.

    It fell 54%, another 50% fall therefore is still a possibility.
    If we can gather some momentum and get past 6000 then I might reconsider how low we may go again but for now I do not discount the possibility.

    Under the terms of the blog I can not promote a share or recommend any buy/sell. My postings are opinions and should not be taken as recommendations. People should always do their own research before investing.

    Greg has been running the random portfolio for 5 or so years now and not long after I became a contributor to the forum I decided to put up a portfolio too. The portfolio is not advice, nor should it be taken as such.

    I will however talk about 1 share in the portfolio and why I have taken a larger position percentage wise in it than I would otherwise do in real life and why I have “traded it” so to speak in the portfolio. This share is FML (as it has been brought up)
    Again this is not advice it is just my opinion and actions with the portfolio regarding FML to date.

    FML are a fairly high cost producer and they were on my personal watch list for some time but at the 8 to 10 cent range I thought them a little too pricey. They have strong prospects for the future with some potential high grade zones needing further exploration/testing.

    They became a buy target into the mid 5′s and on any weakness below that. They had very good support at those levels for quite some time. Allowing a 20% movement into the low to mid 4′s as a low point.

    They were put into the portfolio and at one time reached 450000 at an average of around 4.5 cents. News of the funding deal from Chinese interests made me sell 1/2 the stake for around cost as I thought the share price would come down on the dilution aspect and I could rebuy more at a lower price. Which was done, 1000560 at $0.022 cents to be precise. Giving the portfolio 1225560 at an average of $0.0263. They now have over $200million in cash to fund the exploration of the 4 main high grade zones. This is a good position to be in. The share dilution is the price paid for a healthy bank balance and bringing forward drilling on the prospective sites.

    Share consolidation will no doubt occur in the future but we will wait and see. Potential for a capital return from the excess cash if results are good in a short term.

    Despite the gold price being smashed down at the moment, I believe economic conditions will lead to a higher gold price.

    Potential upside for FML I believe made it worth the risk to designate such a large cash position of the 100k portfolio onto 1 stock.

    I personally hold them in my own portfolio but they make up less than 5% of my total portfolio. No matter how much I like a stock I never go big on it with my money.

  • 885 Biker // Apr 19, 2013 at 8:42 pm

    Jeez… protracted silence….

    If anyone’s waiting for me to snipe-from-the sidelines, get a life. :)

    What Shoes has posted is a remarkably generous analysis and an impressive set of figures, which should encourage anyone who shares his world-view. But why set a sell at a mere 15c? If gold really is the answer to the chaos some perceive ahead, set the bar higher… say 30c… and double your money…

    Watched FML’s price with interest today, expecting to hear a bostonlike stampede as TBs rang their brokers with buy orders. Can you beat city hall? No-one could ever doubt your guts, Shoes, but how will all this end?!

  • 886 Stillgotshoeson // Apr 20, 2013 at 2:22 pm

    100k Portfolio

    BKP 714000 @ $0.005 $3570
    BPT 7500 @ $1.375 $10312
    EVN 7370 @ $0.93 $6854
    FML 1225560 @ $0.016 $19609
    PIO 60000 @$0.025 $1500
    PRU 3900 @ $1.36 $5304
    SBM 6100 @ $0.705 $4300

    Shares $51449
    11Kg Silver @ $778.62 $8565
    Cash $493

    Total $60507

  • 887 Stillgotshoeson // Apr 25, 2013 at 9:59 pm

    Biker // Apr 19, 2013 at 8:42 pm

    “Jeez… protracted silence….”

    I thought the same, at the very least a ‘thanks for your sharing your view shoes, I agree/disagree with the view you put forward and will watch with great interest how your assesment plays out” might have been forth coming…

    “What Shoes has posted is a remarkably generous analysis and an impressive set of figures, ……. No-one could ever doubt your guts, Shoes, but how will all this end?!

    I don’t think so, it real terms against my asset base the portfolio is only a small percentage, easily within the bounds of what one could “risk” on speculative plays.

    The drop is about 3 months gross pay, averaged across lifetime earnings is not a significant amount. As for how will it all end.. _WE_ will find out, won’t _we_?

    The 100k portfolio started 10-01-2012, interesting to see where it will be at in January 2017.. (5 years)

  • 888 Biker // Apr 26, 2013 at 7:35 pm

    “…interesting to see where it will be at in January 2017.. (5 years)…”

    Long, long ago, I credited you with the very rare attribute of disclosing your moves-in-advance. Moreover, I complimented you on your honesty.

    While I believe you’re utterly wrong… and I’ll watch with interest the rise-and-fall of this very minute part of your wealth… I know that one of your objectives is to acquire property.

    That’s a worthwhile goal.

  • 889 Greg Atkinson // May 8, 2013 at 5:59 am

    The RBA cut interest rates again yesterday so this should at least provide some support for the stock market especially for higher yielding stocks but I still don’t expect the ASX All Ords/ASX 200 to move much beyond the 4800-5200 range just yet.

  • 890 Stillgotshoeson // Jun 12, 2013 at 2:14 am

    Stillgotshoeson // Mar 20, 2013 at 3:48 pm

    Greg @ 859

    I see support levels @ 4750 then @ 4500 and @ 4250

    Below 4000 means confidence is lost and last stop will be 3750 before we test new GFC lows. I do not see that happening this year although the situation in Europe is interesting to say the least. Contagion?

    Last Friday the All Ords and ASX 200 both closed under the 4750 level. I think a close under there again at weeks end will put the 4500 call up next.

    37 to 40 redundancies coming up at work. I have put my hand up for a package.

  • 891 Greg Atkinson // Jun 12, 2013 at 7:13 am

    Stillgotshoeson we may hit the correction level this week after which the focus will be on support levels and the ones you have mentioned seem about right to me, although I am still a fan of 4400 ;)

  • 892 Greg Atkinson // Aug 12, 2013 at 9:21 am

    I am sticking with my forecast for the All Ords/ASX 200 from January and still expect them to finish within the 4800-5200 range (or thereabouts). At present they are both just above 5000.

  • 893 Stillgotshoeson // Aug 15, 2013 at 7:53 pm

    100k Portfolio

    BKP 714000 @ $0.004 $2856
    BPT 7500 @ $1.36 $10200
    EVN 7370 @ $0.88 $6485
    FML 1225560 @ $0.016 $19609
    PIO 60000 @$0.015 $900
    PRU 3900 @ $0.655 $2555
    SBM 6100 @ $0.59 $3599

    Shares $46204
    11Kg Silver @ $819.77 $9017
    Cash $493

    Total $55714

  • 894 Greg Atkinson // Oct 28, 2013 at 8:17 pm

    Well the All Ords/ASX 200 closed above 5400 today with the market being on a bit of a roll. It all seems a bit too easy at the moment which makes me think a correction can’t be too far away.

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