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Wow... The bubble is bursting


bostonangler
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Maybe it had something to do with FB denying all crypto currency ads. The denizens of Social Media can't see the deceptive ads anymore. Next level of support is around 6K mark. Had a high in December of nearly 19.5K so this is more than a 50% drop in two months. People are panicking now and selling out. Lets see if it continues trending down through the 7586 price point. If it does it will continue to slide until the 6K support before this trend is over.

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4 minutes ago, Theseus said:

Maybe it had something to do with FB denying all crypto currency ads. The denizens of Social Media can't see the deceptive ads anymore. Next level of support system" rel="">support is around 6K mark. Had a high in December of nearly 19.5K so this is more than a 50% drop in two months. People are panicking now and selling out. Lets see if it continues trending down through the 7586 price point. If it does it will continue to slide until the 6K support system" rel="">support before this trend is over.

 

Good stuff... Personally I have not bought any because I don't understand it... But the values have been insane...

 

B/A

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The Dow fell more than 500 points Friday -- its biggest one-day plunge since June 2016 -- extending the market turbulence that had flared up earlier this week over fears of higher interest rates.

Stocks took another leg down around noon after Republicans released a controversial and now-declassified memo alleging that the FBI and Department of Justice abused their surveillance authority to target his 2016 presidential campaign.

Oddly enough, the decline in the blue-chip stock gauge stemmed  from too much good news about the economy and jobs, which is viewed as a negative for stocks because it has spurred a sharp rise in borrowing costs.

More: 401(k) investors: Is a 'melt-up' happening in the stock market?

More: Dow starts February with more swings, 37-point gain after a strong start to the year

More: Bitcoin: If currency crashed, plunge would harm its investors but not economy

"Temporarily, good news may be bad news for the stock market," says Russell Price, senior economist at Ameriprise Financial. "But that's likely an accepatable trade-off for most Americans who are finally seeing higher wages and better opportunities."

Indeed, after more than a year of calm, there has been a mood shift on Wall Street this week as stock prices have dropped close to 3%. Investors have started to factor in what appears to be a long-awaited move higher in interest rates, which are tied to an improving economy.

In afternoon trading, the Dow Jones industrial average was down by more than 525 points, or about 2%,  and back below 26,000. The blue-chip stock gauge is at risk of suffering its biggest one-day point decline since June 24, 2016, when it fell 610 points after the Brexit vote shocked markets.

Sparking fears of higher rates was a strong January employment report, which topped expectations. Strength in the labor market caused a selloff in the U.S. government bond market. and that has pushed up the yield on the 10-year Treasury note above 2.85%, its highest level since January 2014, or  four years ago.

"The new development (spooking investors) is the spike in bond yields," says Nick Sargen, senior investment advisor for money management Fort Washington Investment Advisors in Cincinnati.

Higher rates mean higher borrowing costs for consumers and businesses, which can slow economic growth. Stocks and many other assets have been powered by record-low rates during a nearly nine-year bull market.

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9 minutes ago, Theseus said:

Maybe it had something to do with FB denying all crypto currency ads. The denizens of Social Media can't see the deceptive ads anymore. Next level of support system">support is around 6K mark. Had a high in December of nearly 19.5K so this is more than a 50% drop in two months. People are panicking now and selling out. Lets see if it continues trending down through the 7586 price point. If it does it will continue to slide until the 6K support system">support before this trend is over.

:nothingtoadd: Well a 2.20 % drop in the Dow on a consecutive Thurs and Friday is not much more than the anticipated market correction. Similar activity occurred when the Dow hit 20,000. If you are liquid at all go shopping on the Dow on Monday.

Edited by new york kevin
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The Market was over bought. It was looking for any excuse to go down. Take your pick, Google and Exxon had iffy earnings, the Memo release, the Blue Moon. Folks were taking profit today from the big run up in Jan. 

 

For me it was a nice Friday gift. I shorted Exxon and Pioneer Oil for a very nice profit. After getting beat up a little yesterday today was really nice.  I suspect we will go down more on Monday and Tuesday. They threw the baby out with the bath water today. Ridiculous, and a great buying opportunity in the near future for investor types. Get your shopping lists ready and buy the earnings winners. Be patient!!  

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15 hours ago, Pitcher said:

The Market was over bought. It was looking for any excuse to go down. Take your pick, Google and Exxon had iffy earnings, the Memo release, the Blue Moon. Folks were taking profit today from the big run up in Jan. 

 

For me it was a nice Friday gift. I shorted Exxon and Pioneer Oil for a very nice profit. After getting beat up a little yesterday today was really nice.  I suspect we will go down more on Monday and Tuesday. They threw the baby out with the bath water today. Ridiculous, and a great buying opportunity in the near future for investor types. Get your shopping lists ready and buy the earnings winners. Be patient!!  

 

I agree, this is one of those times to pick up some cheap shares. As they say, "Buy when there is blood in the streets"

 

B/A

Edited by bostonangler
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The Market is like a game of poker.  You have to know when to hold them and when to fold them. I work on Moving averages in my long term investments.  I don’t start worrying until we break the 50 ma  That’s usually when I buy some puts as protection or take some profits. 

This looks like a normal pull back to the 50 moving average correction after a blistering run up the last few months.  In the last week the Dow has shed 1064 points, about 4%. No biggie.  To get to the 50 day moving average we need to go down another 500 points or so.  That’s another 2%. At that time we’ll see what the big boys do. I suspect they will start buying their favorite earnings leaders like Amazon, Boeing, bank and financials, chip stocks like Nvidia and Broadcom, gaming stocks like Electronic Arts, and Take Two, and others like Netflix, Facebook, Google and Apple. 

Take a look at the McClellan Oscillator. It’s sitting at -168, the lowest since August of last year. I usually don’t get too worried till it hits -250. You never know how investors will react to a pull back. Weak hands freak and sell while more experienced investors buy protection or sit tight and weather the storm. I think we will be stepping in to pick up some cheap shares by mid week. Usually I’m just nibbling, keeping plenty of cash ready.  If things turn nasty and we start heading for the 100 day moving average you’ll be looking at a 10-12% correction. That will start feeling uncomfortable but still nothing to panic about.  Basically our economy is strong and poised for growth. The rest of the world is recovering nicely as well. Two things to watch are the Fed getting worried about a too hot economy (inflation) and raise interest rates, and the political mess in DC. The market hates uncertainty and our politicians are doing a wonderful job of creating more uncertainty.

Blood in the streets doesn’t begin till the Dow, S&P, and Nasdaq, breach the 200 moving average. 

Im in a wait and see what happens mode and will probably do some Day Trading in XIV and VXX next week till I see the all clear signal

 

 

 

Edited by Pitcher
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34 minutes ago, yota691 said:

LOL Funny you say it Bursting or the Article....But yet it still exceeds what it was before Trump....Good Luck with all that Hate you have stored up!!

 

Sorry Yota I don't understand your comment. This thread is about the markets being over bought and the obvious correction. The markets have soared since 2009 without real economic reason other than wild west style buying. The original post was before yesterday's 1175 point drop. This isn't about politics it is about buying and selling. Profit taking is what investors do. Believing any upward trend will never end is what dreamers do. If you buy a stock and it goes up 30 or 40 percent or even crazy like 100 percent you take your profit. There are several stocks I bought that went up over 100%. I took out my initial investment kept my free shares and will reinvest in new stocks at these lower prices... JMHO

 

B/A 

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The global downturn has spread to Arab markets since the opening.

The Kuwait market reacted with great negativeness with the declines in the international markets. With the opening bell, the leading shares suffered significant losses. KFH and National Bank shares were the biggest losers. The shares were extended to medium and small shares. Although the correlation coefficient between the Kuwait Stock Exchange and its companies Globalism is very limited, but the market is usually extreme in the negative reaction.

The UAE market indices strongly joined the series of global market declines when they opened. The high correlation of these markets with the US indices led to the loss of the Dubai Financial Market Index more than 2% of its value with the opening of the session on Tuesday and under pressure from the real estate sector, specifically from Emaar Properties, Lows in more than a year,

The Abu Dhabi stock market was better off ... Although the Abu Dhabi index fell by more than 1%, it managed to hold above 4500 points supported by the cohesion of the banking leaders and to determine the stock of Abu Dhabi First Bank, which managed to hold above AED 11 until the moment .

As for the Qatar market, the general index of the stock exchange fell by more than 3.2% at the beginning of trading Tuesday, down by 280 points by pressure from all sectors. The index cut back to 1.7%, boosted by purchases targeting leading stocks in the banking and manufacturing sectors.

 The Saudi market opened on Tuesday with a drop of 2%, losing more than 100 points. SABIC fell 1.5%, shedding 105 Saudi riyals while Al Rajhi Bank fell 2%, losing 73 riyals per share.

http://economiciraq.com/2018/02/06/موجة-التراجعات-العالمية-تمتد-إلى-الأس/

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Great opportunity for those who have learned how to play the Market. I’ve had 3 great days trading this wild market sell off.  I did what I said I was going to do in a post I wrote over the weekend.  Played xiv and vxx.  Those are traders etf’s  Don’t hold em overnight. 

Ive got a list of stocks I will buy when the market stabilizes.  

 

You never know how these pull backs are going to go. We tagged the 100 day moving average yesterday. Looks like an inside day or market regroup day.  We may have to test that 100 dma again and we might even have to take this pig down to the 200 dma.  For the time being I will be patient and trade what I see in the two etf’s mentioned above.  

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Be patient BA, I will buy the earnings leaders but not all at once.  I think we still have a little more work to do on this pull back.  It takes a little time to unwind this volatility.  I'm looking for  a double bottom on the 100 ma.  I think the algo's and the machines got triggered yesterday.  That was an aberration but with all this volatility you have to be careful about going long.  I will cost average in when I think it is time.  Until the time to go back Long I will Day Trade, in and out.  It's a tough way to make a living but it is good to do it every now and then to sharpen your skills and discipline.  I trade on a 5 minute chart.  When I see the 9 Hull MA crosses the 18 ema and I see the mini Bollinger Bands curling up I'm going in.  Opposite for shorting.  I'm only looking for .40-.75 a trade.  No reason to get greedy.  Day Trading is all about  taking your profit if you have one and cut your losses if the trade doesn't go the way you want.  These Day Trades move fast and you have to buckle up.  Today one trade VXX for .74 on 4K shares traded.  Nice little day for about 2 hours of waiting for optimal conditions.  I've been trading for many years.  

 

 

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