I WANT A MARKET CRASH

[traderx]

NEW YORK (Reuters) - Stocks fell sharply on Wednesday with losses concentrated in technology shares, clipping a three-day rally and resuming recent weeks of selling on a new batch of earnings warnings and layoffs from some corporate giants, including Walt Disney Co. (DIS.N) and Nortel Networks Corp. (NT.N)(NT.TO)

The Dow Jones industrial average (.DJI) dropped 162.19 points, or 1.63 percent, to 9,785.35, according to the latest data. In the previous three trading sessions, the Dow had risen 5.6 percent. The tech-laden Nasdaq Composite Index (.IXIC) fell 118.34 points, or 6 percent, to 1,853.92. The benchmark Standard & Poor's 500 index (.SPX) slid 28.92 points, or 2.45 percent, to 1,153.25.

``People are still concerned we're heading for a recession and a serious profit slump,'' said Kevin Bannon, chief investment officer at BNY Asset Management, which oversees about $60 billion in assets. ``There are still people out there who don't appreciate how severe short-term earnings problems are.''

Walt Disney, theme park and television network owner, slumped 84 cents to $28.36 after a letter to employees outlined plans to cut 3 percent of its work force in the weak economy.

Canada's Nortel fell $2.76 to $14 in New York Stock Exchange trading after the world's No. 1 supplier of telecom equipment slashed its quarterly estimates and planned more job cuts amid pricing pressures and the U.S economic downturn. Reut16:17 03-28-01

BE VERY CAREFUL - THIS RECENT FALL IS BEING VIEWED AS SIGNIFICANT, THINGS COULD GET MUCH WORSE BEFORE THEY GET BETTER. THE BEARS HAVE RUN AMOCK. WE ARE NOT OUT OF THE WOODS YET. THE NEXT 48 HOURS WILL BE CRUCIAL.

Tx

 

[madasafish]

I've been bearish on techs for a year. IMO anyone with a buy and hold policy on techs is just asking to lose as we are nowhere near a bottom. NAS C 1200?

As far as old economy is concerned, the US boom was driven by high techs which are now layoing off staff and downsizing. SO the old economy will at best stop growing. And at worst have a recession

With the average US Dow stock on a PE of 22 (as FTSE 100) these are all priced at 25% pa profit growth per year EVERY year.

My call: FTSE 100 in 4500s , DOw 7500 ish.

So when it falls don't blame market manipulation...

(Oh and by the way, please do NOT quote any analysts back to me. UNLESS they have in writing forecast Dow < 10k at start of year. Most of them are just parrots repeating the same half baked semi coherent rubbish).

I do love analysts

Mike

 

[Joe]

Amazingly we all get mesmerised by forecasters, analysts and false views of the value of a share. I recently saw one analyst review the valuation of ARM and suggest a downgrade from £10 to £8 at a time when the price was less than £4 and it went down!

Every so often we all have to return to basics; IMO the true value of a share is the assets of a company divided by the number of shares issued. ( without going into a long argument over asset valuations).

The stock market chooses to use valuations based on future profits. Like the story of the Emperor's new clothes, as long as we all believe that zxy shares are worth XXXp, there is no problem; however every now and then reality strikes and we have a "correction" except the media call it a collapse and panic sets in.

We all tend to run with the herd mentality, sometimes this brings good times, sometimes this brings bad, (not called Joseph for nothing you know). The main reason it brings private traders bad times is the inability to short the market. If we were profiting this way all would be well with the herd.

Take the opportunity to plan for the good times, learn from experience and go forward wiser for it. I take the view that amongst these institutional investors, who are making pots of money, are the people looking after my pension!

Regards
Joe

 

[madasafish]

I'm learning to short. It's like 1999 in reverse. Big profits, high risk.. but fun.

Worth doing if you trade full time or can time it right, have stop losses , take profits and are not greedy.

Not to be done if you worry...

Mike

 

[Uncle]

Mike, assume when you say you are into going short, you are using cfd's or options. If you have a found a broker that will accept going short in the normal sense, do please let us know who.

Many thanks

John

 

[madasafish]

Hi John
I'm spread betting FTSE 100/250 companies and the Dow.
I find www.finspreads.com a very good company as their web based betting is very easy to use but also use IGIndex adn City Index.

All 3 have similar spreads and very good service.

I find the secret is:
short term trades
intra day charts
don't overtrade as if it goes wrong and get margin called and cannot pay you will be stopped out . and lose big time.
Trade only the best opportunities.
Match stakes to risk
Take profits..

And watch markets like a hawk..

Mike

 

[traderx]

I think the US markets are at a cross roads tonight, the scenario we all talked about for months is beginning to develop with people selling their blue chip holdings to meet margin calls. Brokers will be closing positions without reference to US customers. Titus UK (Mark) has spelled out the situation succinctly.

Although it is difficult to forecast a crash with any certainty, I think we are nearer to a CRASH than at previous times. Investors and traders are becoming demoralised and selling up. The BEARS are firmly in control and shorting activity is likely to maintain the downward trend, reinforced by earnings warnings of which there are forecast to be hundreds more to come.

I think we only need a single EVENT to be the catalyst and BANG! I really think we are nearer to this event than at any time since 1998. We have been spot on up to now. Watch this space.

Tx

 

[titus-uk]

Like many, I made the mistake of rushing in for bargains and got burnt. Until I see a higher high, I would not touch this market with a barge pole. This is a day traders market only. The selling is getting wider, as good stocks are sold to fund other losses. We talked about phases of a decline a few weeks ago. I now think we are firmly in phase 3.

The negativity will have been advanced by a non-voting member of the Fed telling the markets that they should not count on the Fed to alter rates just because they are tumbling. Indeed, unless they push the entire economy down, they have no more importance than other trends. The tail does not wag the dog.

So let the bottom fishers fish. Wait for the next fall, for as sure as night follows day, it will come. I am older and wiser now. In some ways I feel lucky to only know the bad times. It has made me work harder, left me more mechanical and less euphoric. So when this crap stops, I will have worked hard on perfecting a strategy that works! But I feel there may be a while to wait before that happens!

Be careful
Mark

 

[Riz]

Wouldn't it be better if we had it at the time we wished so?

Riz