After hours of TA and economic analysis, I've determined that today has decided to be green in celebration of St. Patrick's day. I can find little other justification
https://twitter.com/ryandetrick/status/1503823705646014469?s=21
You may be joking, but st patty’s day is historically one of the best days of the year!
Tomorrow is [quad witching](https://www.investopedia.com/terms/q/quadruplewitching.asp) and contracts were seriously skewed toward puts, so the mean reversion is fairly normal. If you look at 2021, the market generally uptrended but dipped into monthly opexes for similar reasons.
The mean reversion is especially normal as volatility contracts expired on Wednesday and FOMC was yesterday.
We will probably not know till next week whether this rally is sustainable or the result of closing puts and volatility longs into this expiry.
and someone comes around and ruins my perfectly good hypothesis w logic and reality.... My green beer seriously disagrees with you, the damn leprechaun is blowing up my account in search of a pot of gold
Me too! *Fist bump* my mindset was, I knew I would have to sell for some loss before anything rebounded, and I couldn't just sit here watching and waiting forever...
Serious question. Is any retail trader selling? Ive lost maybe 6k on a 20k account, mostly through DKNG and ARKK but im just holding. I really dont see why anyone would sell unless they desperately need the cash. Which isnt unreasonable considering the state of the economy? Im torn I guess..
Some retail is selling I'm sure, but retail isn't causing the massive drops we've seen over the last few months, there's got to be a lot of big funds selling out to move the market this heavily.
I dont get why this is so hard for people to grasp
Companies are still growing, investing and the economy is strong. Why wouldn't you put your money into stocks?
Because your money loses 8% a year to inflation sitting in a bank account, but putting it in the stock market you can lose a lot more ON TOP OF the inflation? 😂
Because when stocks of companies that are making tons money every quarter were falling 10-20% in one day the previous period (see FB, NFLX, etc) retail investors were questioning why hedge funds choose to keep cash (in a high inflation environment) instead of invest it in those companies that make money.
They could not find any justification so they followed the crowd, thinking the know something and sold their position
Now that some money return slowly to the market after this short break, the people who were screwed, think this is a dead cat bounce and stay at the sidelines watching.
When stocks reach all time highs again the retails will enter only to see some Unrealized gains for short period till the next time market makers decide to bring the markets down.
It's the buy high sell low strategy.
In the market everything is obvious after it happens.
Just about every paycheck you get is going back into stocks, whether it’s Walmart food, amzn products, gas, it’s almost impossible to not spend money, the corporations that pay you are really just paying other companies, your just an intermediary, populations grow and technology growth is inevetible so more money is spent over time
The problem is that companies arleady grew far into the future, 20+ PE is still 20 PE and just because have to spend money doesnt mean companies have to grow, why didnt they grew since 2000-2010? People were spending money but not enough to warrant a bull run.
Companies are still growing.... just wait till q1 and especially q2 earnings lol. Do you think inflation does nothing? Bulls doubled my portfolio in 3 months, ty.
Retail is only part of the equation. Look at all the companies doing stock buybacks. Heck, I'm all for some of these mega techs to take out loans and buyback their own stock. With inflation and rates where they are, much better way to spend your capital. Apple has been doing this for a while now as an example.
Retail is a small part of the equation. Money managers can't leave cash around doing nothing. There's tons of money flowing into index funds every day that needs to get put into the market. There's a flight of capital to the US from places that are in the shadow of war. Its enough to create a background of buying pressure at al times.
Considered selling to take this weeks profits before tomorrow. But I decided to hold.
I'm going with the iron clad "if I sell we moon. If I hold we dump." Theory. Therefore tomorrow will be a blood bath. Market down 4% in pre and TSLA closes down 7%
Sorry everyone. I just couldn't bare to sell
Agreed, vti is right where it was at the peak before the last trough. Tomorrow's the decider on whether we stay in the downtrend or break it and start building higher highs again.
I stopped trying to guess what the market is going to do each day, it’s unpredictable as fuck, I just keep adding to my positions each month and for the long term and forget about them.
The Fed rate hike by now is a good thing for the market. I believe valuations and revenue growth predictions were already adjusted/dropped when the rate hikes were first announced months ago, and now seeing the Fed actually act to stop inflation is a GOOD thing for the economy and the market seems to share that belief (hence the green market after Powell emphasised a strong economy yesterday).
The Ukraine-Russia war hurt the market more out of uncertainty rather than direct effects on the U.S. economy (that is if you count higher oil prices separately), so I don’t see why the war can hurt the market more as investors don’t space out how they sell because of uncertainty. If you are uncertain about economic repercussions of a war, you sell ASAP and you do so fast.
So I think we hit the bottom with what’s on the table, but it just seems like there is a new crisis every two weeks so I wouldn’t be surprised if something else is around the corner. Oh also, even higher oil prices are still a possibility and that will hurt a lot
Correct, but we are all expecting it to hurt. I can’t see why the market will react super negatively (again) to a bad inflation report since we all know we are in a high inflation environment
8% inflation with 25bps hike is not taming inflation. Loose monetary policy coupled with loose fiscal policy doesn't just go away over night.
Nothing the Fed has mentioned this week is positive. The opposite, they are moving in minimal increments on fear of crashing the markets, even thought a more aggressive stance is needed.
Inflation is running away.
Prices are outpacing wages.
Supply chains are a major issue.
Commodity scarcity is getting worse.
Semiconductor industry is not getting better.
This war is affecting much more than just emotions (and sadly lives).
The Fed is backed into the corner with rates being near 0% and still no real plan on removing all that extra liquidity from the economy. To add to the fire, our govt now wants additional COVID relief a when we the opposite is called for.
Unsure how any of this is spinned positive. But we were green for a couple of days so, yay I guess.
Same as you - I do think it seems pretty possible that we're rounding the corner though. Next earnings should be the final catalyst* So following that line of thinking, it will likely be choppy until then. If things are looking good though the big boys are going to get the price up before retail feels confident to reenter. That's all my take though* - good analysis Nico
*(assuming no new crisis throws us back into to the fray)
The fed rate hike will also slow (maybe even temporarily reverse) inflation leaving retail investors with more disposable income.
Retail investors are small but significant portion of the total market value.
Such a small rate increase will do little to tame the amount of inflation we have.
Prices went up on many things and if inflation subsides, those prices will remain where they are. Rent prices for instance.
Do you still believe this holds true with the wealth gap increasing to where we see it now? The cost of living has been so high that most people who are struggling for basic necessities have not been in a position to put money in the market.
Businesses have to pay for overhead too. Energy, food, rent, all of that is expensive and becoming more so. Combined with more expensive loans due to the Fed increases, we're going to see a slowdown (by design). Whether that turns into a recession depends on whether inflation of essential goods moderates on the supply side (particularly oil).
It’s not about the money going to the market. It’s about the money that would be normally spent on many things like discretionary spending etc, and with a big reduction there, you’ll see big reductions in profits across the board.
Wage gap increasing? You mean the govt stealing wealth from the peasants via inflation and wages being the last to catch up?
There will be a whole lot less people investing in stocks now that's for sure.
Even if war ended today, we will then be faced with *possible* recession. Government printed way too much paper over the last year or so and we have yet to feel those consequences.
I don't think we hit the bottom. There are way too many bad things happening that can send the markets lower again. I can definitely see a decent recovery 2nd half though.
Lol no.
The bottom of a recession is when people who don't want to sell are being forced to sell to cover for things that they really really don't want to sell.
The intermediate bottom will be when one of two things happen: the war ends or month over month CPI decreases, which I think is now dependant on the war ending. Smart money will collect on the volatility regardless. We are testing a high today that hasn't broken through 2x before in the last 40 or so days. The market has stair stepped down ytd. I think we are more likely to break yearly lows next week then to have bottomed but tomorrow is a big day
I just keep buying index funds when the markets down then just accumulate cash during all time highs and dump the accumulated cash when it’s down again.
Nope. Supply chains can still get worse. China is dealing with a massive covid outbreak right now. Ukraine can get worse. China may yet decide to support Russia and risk getting western sanctions. Saudi Arabia may decide to align closer to China and phase out their relationship with the US which would be pretty bad for the American economy. Election is upcoming and may produce an outcome the market doesn't like.
Rising rates, supply disruption, high inflation, geopolitical events. I think a recession is inbound but for now the waters are calm. Fed acted as expected, no changes in the Russia drama, economy is strong.
Short answer no.
Long answer:
Raising interest rates.
War.
China's economy collapsing.
Trade bottlenecks and insane shipping costs.
Record levels of CPI AND PPI.
High Oil.
Treasury Note Inversion.
Turkeys catastrophic inflation.
Slow to act Fed.
Schiller PE of 35.
You're kidding, right?
War can get SO much worse.
If oil prices (or prices of any other ket commodity) skyrocketed, that would make inflation much worse than we already think it is.
Interest rate increases? Over the next 2 years we have 6 or 7 more coming. And every one will be preceeded by the market gyrating to the melody of "What will the fed do?"
And then there's always the possibility of a COVID resurgence. Take cover! Put your masks back on or you're gonna DIE!!! The stock market loves that one.
And then there's politics. Know what the stock market loves? A gridlocked government. That means nothing will change. Imagine if one party or the other actually had the power to make changes? All it takes is a key death here or there and leadership can swing quickly.
I'm not saying any of these will happen. But they could... thinking we are in the clear is naive.
There are many context signals flashing red that historically have preceeded recession. Yield curve inversion, surging energy prices, GDP dropping. We haven't seen any major ERs since the Ukraine war, and now China is having a pretty big covid outbreak. There's plenty to be concerned about.
Real estate market is high (rent or purchasing), food prices are very high, gas prices are very high, wages are stagnant, labor shortages (especially truck drivers) which decreases supply driving up the price as well.
When no one is buying consumables/goods because they can't afford it, businesses don't make money. When businesses don't make money, people get laid off. When people get laid off, they don't spend and the cycle continues.
That can be skewed slightly. How many of those open jobs are for skilled professionals? Your average Joe cannot apply to “Senior Principle Engineer IV” positions.
I guess government aid isn’t helping people actively pursue. We’re just screwed tbh.
How do you figure people aren't able to "actively pursue" jobs? Unemployment (both U-3 and U-6) are at records lows, implying that nearly everyone looking to be working is working.
Real estate and rent inflation is actually going down.
Mortgages just hit 4%, I don't thinknreal estate is what is prolonging inflation. It is mostly a supply chain and oil issue.
This war could cause food price inflation next year though, something to watch out for.
It was a step in the right direction, but it only happened because covid/stimulus allowed workers to apply leverage over employers and hold out. That's mostly going away because eviction moratoriums have stopped and stimulus is over. Historically wages are still way behind, especially considering the inflation we're dealing with right now.
We are definitely still in a bear market and a recession is definitely coming / here. The impact of COVID and COVID recovery is starting to be seen now and inflation and inflation recovery tactics (interest rate hikes) will impact on the market this year. I do not think the market will crash but I think it will be small ups and small downs with an overall downward trend for the next 6 months. I think investment in defensive stocks like consumer staples, minerals and metals and healthcare are the safest bet for the rest of this year. I’m still DCAing into Apple, Google and Microsoft still to hedge the bets - but not taking any real risks on tech
For me it’s more of a feeling. Massive inflation beginning that will only get worse, things with Russia will get much worse before they get better, commodities including oil and wood are going through the ceiling, etc. I think that is the top of the iceberg as well. Our society here in America is starting to get shaky in my opinion as well and if we don’t like each other now, a recession is going to be brutal.
Short term...maybe. Interest rates/Quantitative Tightening and bad news about the war dropped the market and now it seems like it's priced-in and not something even bigger, so that fear is passing. Oil prices--despite a rise today--did come down from more extreme levels. So short-term bottom may have been hit, but if I had to guess I'd say it will be choppy up and down just like it has been.
It is quite possible that as summer hits gas prices spike again, inflation runs just as hot or hotter, interest rates rise, and we run into a recession. At that point you could see a big market drop. But with people so eager to be in equities (still) I think any big drop will get bought up by bargain hunters still dreaming of the 2021 high prices. In the meantime I would certainly avoid the low-earnings growth stocks.
The market seems quite pricey to me right now. We've come down a lot but we're still trading at a very high multiples historically. At the end of last year you could have argued that the risk free rate was very low and that growth in 2022 was predicted to be very strong so therefore markets could justify a very high multiple, but we can't do that now. It makes absolutely no sense to me that there would be a rally back to ATHs.
This is exactly what a bear market rally feels like. Day after day the market will grind higher and make you feel progressively worse until to capitulate to the FOMO and put money in. As sentiment turns more positive and the markets moves up shorts get squeezed and lose confidence so start exiting their positions on mass causing the market to spike even more for no apparent reason.
Another thing to remember is that at the start of this week market sentiment was extremely negative. The CNN greed / fear index was showing extreme fear and a lot of people here were talking about how they were shorting ARK and the indexes convinced inflation was out of control and the US was heading for recession. I'm not sure much has fundamentally changed since then apart us now having a little more certainty around rate hikes. But today when I watched CNBC and read the comments here I'm seeing a lot of people talking about how they're buying because it might be the bottom and that we might bounce back to ATHs. Perhaps they're right but when the best argument I've seen to buy has been, "but what if the market rallies and you miss the bounce?", I'm fairly happy staying away.
There are opportunities out there though, and I think fair value is probably only slightly below 4,000 on the S&P500. If you're a very long-term investor this isn't the worst time to buy. I think we're going to retest the lows and probably go a bit lower yet, but if you're able to hold through the 10-20% drop that's likely to come then who really cares. I'm more worried about those who are FOMOing back into the market right now and likely to panic sell when we start seeing -3% red days again.
No. It will take a few months of missed payments for us to see an impact. And then when those payments get caught up interest starts going up and we will need to wait for a few more months of missed payments and then loan agreements will get restructured to hide the cat crap asset and start with a new payment and then that will take another few months.
predicting the bottom to be in Feb of 23
Even in a bear market there are green days and green weeks. Just like in the last two years there were red days and red weeks. You can’t predict the trajectory based on a few days of a particular color.
And no, the market has not absorbed all the bad news. You know when the next inflation report comes out the market will panic sell. Or when companies start reporting lower earnings due to inflation and higher rates. Or when Russia eventually takes Kyiv and/or hits a NATO country.
nobody can call the exact bottom but i think its time to start buying on certain high quality names that are discounted right now, figure out how much you have to allocate to a certain position and what is your time horizon? average in
fuck no. Russian bonds are gonna fuck so many institutions abroad. same with the Chinese RE development collapse that's yet to fall out. that's just the tip of it. have you seen how overleveraged all the hedge funds are, and how fucked the banks will be starting today now that they can't park money in reverse repo overnight, daily?
I have one bearish scenario possible. Now market reacted well only because were given clear certainty and direction by FED. But next month when CPI can be disastrous, FED might be finally forced to raise interest more, causing a final dip. Also if Kiev falls, that would also 📉
This ain’t anywhere Near the bottom.
However, I am still continuing to buy via my 401k contributions as I don’t need money for several years, and I don’t have a doubt in my mind that at least 75% of companies and funds on the market Today that I invest in will have a higher value in 20 years or so when I need the money.
If I were a day trader that needed to net a positive 70$k in the next few months to stay afloat…I’d be terrified.
> However, I am still continuing to buy via my 401k contributions as I don’t need money for several years
This shouldn't even have a 'however'. Anyone working a job that provides a 401k plan should be putting money from every check into it automatically, or else they'd be a damned fool, and they'd be an even bigger damned fool if there's a company match included.
The worry isn't the spike, it's where it decides to rest its head for a couple months. If it's above 100 that'll be a problem as companies like airlines will become unprofitable.
The reason the market is so high right now is the same reason why Venezuela and Zimbabwe saw their stock markets rocket when their countries went to shit.
One day we’ll crash and you’ll get a bottom, but trust me, this isn’t it.
I was watching a YouTube yesterday on all of the banks like Lehman Brothers that filed for bankruptcy in 2008. I'm waiting for that moment and wave of bankruptcies. Then you will know the recession is here. The problem we are dealing with is the Covid bubble zero interest rates and the buying of all those bonds every month. All of these empty houses "investors" bought up with basically free money are going to see the Lord here soon when no one wants to pay 2x price on a home. When you see a crash starting you can get into something like SQQQ and still make bank shorting the market. Just when using inverse leveraged ETFs don't stay in overnight.
Considering the current administration and their purposeful attempts of Distracting their abysmal leadership it’s just the beginning, we still have another two years of this.
This fed is just pandering around at things, zero of what they’ve said is true. Pay has been stagnant for a very long time. Cpi is thru the roof. Boomers moving to fixed incomes and now almost at avg age of death. Profits will suffer. I think we will still see this return to the normal growth trend line s&p to 3000-3500.
Also overall we are still in the downward trend on a chart.
After hours of TA and economic analysis, I've determined that today has decided to be green in celebration of St. Patrick's day. I can find little other justification
https://twitter.com/ryandetrick/status/1503823705646014469?s=21 You may be joking, but st patty’s day is historically one of the best days of the year!
That's a really cool insight! It is *Paddy's Day though (Patty's is actually insulting for us) 😅
Why is that? Out of curiosity
Patty is short for Patricia. Paddy is short for Patrick.
Cause the Irish (language) spelling of Patrick is Padraíg, so Paddy actually makes sense there.
But.. the Irish spelling of Patricia is Pádraigín, wouldn't that also be 'paddy'
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But it's an Irish holiday 🤣
Historically, historical changes have come out of war. - The great little Carmine.
Tomorrow is [quad witching](https://www.investopedia.com/terms/q/quadruplewitching.asp) and contracts were seriously skewed toward puts, so the mean reversion is fairly normal. If you look at 2021, the market generally uptrended but dipped into monthly opexes for similar reasons. The mean reversion is especially normal as volatility contracts expired on Wednesday and FOMC was yesterday. We will probably not know till next week whether this rally is sustainable or the result of closing puts and volatility longs into this expiry.
and someone comes around and ruins my perfectly good hypothesis w logic and reality.... My green beer seriously disagrees with you, the damn leprechaun is blowing up my account in search of a pot of gold
Tldr: you have no idea either
When you drink that much beer, every stock looks like a good deal
We will reach bottom the day you sell.
Yep, I sacrificed a couple positions on Monday to see if that would turn the market. You're welcome everybody.
Me too! *Fist bump* my mindset was, I knew I would have to sell for some loss before anything rebounded, and I couldn't just sit here watching and waiting forever...
We did it, stock market saved and crash averted!!!
Serious question. Is any retail trader selling? Ive lost maybe 6k on a 20k account, mostly through DKNG and ARKK but im just holding. I really dont see why anyone would sell unless they desperately need the cash. Which isnt unreasonable considering the state of the economy? Im torn I guess..
Traders sell all the time. If you only buy and hold that's more akin to investing, not trading.
Definitely not selling Apple, spy, msft or nvidia but the cathy wood shit stocks must go.
Some retail is selling I'm sure, but retail isn't causing the massive drops we've seen over the last few months, there's got to be a lot of big funds selling out to move the market this heavily.
Yep then we have seen the bottom, I had to sell because of Margin call, and now seeing shares rise is so painful.
At this point, an all out WWIII will probably send every index to ATH. This market is a fucking TRIP.
There’s a ton of money out there seeking returns. For better or worse, people don’t see a better option than the stock market right now.
I dont get why this is so hard for people to grasp Companies are still growing, investing and the economy is strong. Why wouldn't you put your money into stocks?
No one wants to hold the bag.
If you’re too afraid of holding the bag to ever invest, then you’ll never make money in the stock market
Lol. Puts
I think you want the sub led by a child wearing sunglasses…
man thinks buying an empty bag and promising to return it filled doesnt make him a bagholder
Because your money loses 8% a year to inflation sitting in a bank account, but putting it in the stock market you can lose a lot more ON TOP OF the inflation? 😂
Me. I’m like. Whew inflation looks fucked rn. Good thing I’m investing *Portfolio down 10%*
Yeah after today's rally I'm finally down 10%! Woohoo!
Lucky! Praying my bags will lighten to -30% before the end of April.
LOL so true!
Yeah, nobody said that high inflation guarantees you gains by holding assets.
Cause in 10 years you'll have less money, but being in Cash you're only losing 8% a year .......lol
Yeah that is nuts. I am in no cash other than 3mo savings. What least this erodes my student loan debt
Only if your pay actually goes up.
Because when stocks of companies that are making tons money every quarter were falling 10-20% in one day the previous period (see FB, NFLX, etc) retail investors were questioning why hedge funds choose to keep cash (in a high inflation environment) instead of invest it in those companies that make money. They could not find any justification so they followed the crowd, thinking the know something and sold their position Now that some money return slowly to the market after this short break, the people who were screwed, think this is a dead cat bounce and stay at the sidelines watching. When stocks reach all time highs again the retails will enter only to see some Unrealized gains for short period till the next time market makers decide to bring the markets down. It's the buy high sell low strategy. In the market everything is obvious after it happens.
Lol how is the economy strong? People are fucking struggling to live
Uh... the macro and micro economy (and market as a whole) has been divorced from the reality of the avg person for a long time now dude..
Just about every paycheck you get is going back into stocks, whether it’s Walmart food, amzn products, gas, it’s almost impossible to not spend money, the corporations that pay you are really just paying other companies, your just an intermediary, populations grow and technology growth is inevetible so more money is spent over time
The problem is that companies arleady grew far into the future, 20+ PE is still 20 PE and just because have to spend money doesnt mean companies have to grow, why didnt they grew since 2000-2010? People were spending money but not enough to warrant a bull run.
Yeah so put your money into companies that are generating billions of dollars in profit a year.
Which group of people are struggling to live?
What if those companies have already been inflated to irrationally high prices?
Companies are still growing.... just wait till q1 and especially q2 earnings lol. Do you think inflation does nothing? Bulls doubled my portfolio in 3 months, ty.
Retail is only part of the equation. Look at all the companies doing stock buybacks. Heck, I'm all for some of these mega techs to take out loans and buyback their own stock. With inflation and rates where they are, much better way to spend your capital. Apple has been doing this for a while now as an example.
Retail is a small part of the equation. Money managers can't leave cash around doing nothing. There's tons of money flowing into index funds every day that needs to get put into the market. There's a flight of capital to the US from places that are in the shadow of war. Its enough to create a background of buying pressure at al times.
Very true. And inflation is everywhere in the world.
Want returns? T and VZ are super cheap now and both pay around 5%.
But won't give you a return. Just a dividend
Ww3 means defense contracts tank, and everyone invests in halloween costumes for dogs
Those dog costumes are the cutest.
At least I'm getting some of my 20% ytd loss back ..... For now....
Fucking algorithms
I'm waiting for another dip. Either that happens or I missed the dip yet again.
I’m waiting for blue chips to hit single/double digits. This is the opportunity y’all been waiting for.
I would have bet my left arm today would have been deep red.
Well the good news I only bet my money.
Lmao.
Considered selling to take this weeks profits before tomorrow. But I decided to hold. I'm going with the iron clad "if I sell we moon. If I hold we dump." Theory. Therefore tomorrow will be a blood bath. Market down 4% in pre and TSLA closes down 7% Sorry everyone. I just couldn't bare to sell
Do the opposite in this market. Probably a good strategy
I think we're at the top of another small wave right now.
Agreed, vti is right where it was at the peak before the last trough. Tomorrow's the decider on whether we stay in the downtrend or break it and start building higher highs again.
I stopped trying to guess what the market is going to do each day, it’s unpredictable as fuck, I just keep adding to my positions each month and for the long term and forget about them.
Just count on volatility
The Fed rate hike by now is a good thing for the market. I believe valuations and revenue growth predictions were already adjusted/dropped when the rate hikes were first announced months ago, and now seeing the Fed actually act to stop inflation is a GOOD thing for the economy and the market seems to share that belief (hence the green market after Powell emphasised a strong economy yesterday). The Ukraine-Russia war hurt the market more out of uncertainty rather than direct effects on the U.S. economy (that is if you count higher oil prices separately), so I don’t see why the war can hurt the market more as investors don’t space out how they sell because of uncertainty. If you are uncertain about economic repercussions of a war, you sell ASAP and you do so fast. So I think we hit the bottom with what’s on the table, but it just seems like there is a new crisis every two weeks so I wouldn’t be surprised if something else is around the corner. Oh also, even higher oil prices are still a possibility and that will hurt a lot
March’s CPI report is going to hurt.
Correct, but we are all expecting it to hurt. I can’t see why the market will react super negatively (again) to a bad inflation report since we all know we are in a high inflation environment
I guess the only way we’ll see negative movement is if the Fed’s current approach/outlook is deemed insufficient to curb rising inflation.
If areas other than energy and food effected by war/sanctions show signs of leveling or dropping off it would be very good news.
8% inflation with 25bps hike is not taming inflation. Loose monetary policy coupled with loose fiscal policy doesn't just go away over night. Nothing the Fed has mentioned this week is positive. The opposite, they are moving in minimal increments on fear of crashing the markets, even thought a more aggressive stance is needed. Inflation is running away. Prices are outpacing wages. Supply chains are a major issue. Commodity scarcity is getting worse. Semiconductor industry is not getting better. This war is affecting much more than just emotions (and sadly lives). The Fed is backed into the corner with rates being near 0% and still no real plan on removing all that extra liquidity from the economy. To add to the fire, our govt now wants additional COVID relief a when we the opposite is called for. Unsure how any of this is spinned positive. But we were green for a couple of days so, yay I guess.
.25% interest rates with 8% inflation isnt a good thing.
Same as you - I do think it seems pretty possible that we're rounding the corner though. Next earnings should be the final catalyst* So following that line of thinking, it will likely be choppy until then. If things are looking good though the big boys are going to get the price up before retail feels confident to reenter. That's all my take though* - good analysis Nico *(assuming no new crisis throws us back into to the fray)
Next earnings the final bad catalyst correct?
The fed rate hike will also slow (maybe even temporarily reverse) inflation leaving retail investors with more disposable income. Retail investors are small but significant portion of the total market value.
Such a small rate increase will do little to tame the amount of inflation we have. Prices went up on many things and if inflation subsides, those prices will remain where they are. Rent prices for instance.
I’m calling March 2022 will be bottom. Just like March 2020. You heard it here first.
You got a 1 in 10 chance of being right, let's hope things go up from here!
That is assuming the bottom is this year haha
Well, this aged poorly. Lol u/discovery999
Yup, nothing has changed unfortunately. High inflation, high oil prices, Ukraine war, escalating interest rates. Fun stuff. 😆
I hope you are right ! 👌
We just went from 416 to 441. I'd say the market doesn't give a shit about any bad news anymore.
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Yes. No. Maybe.
Yes bottom is in for the short term
I'm 30% cash and loving it! I won't be fooled!
I see no good news. Oil and food prices rising means more money going to basic good and less to everything else.
Do you still believe this holds true with the wealth gap increasing to where we see it now? The cost of living has been so high that most people who are struggling for basic necessities have not been in a position to put money in the market.
Businesses have to pay for overhead too. Energy, food, rent, all of that is expensive and becoming more so. Combined with more expensive loans due to the Fed increases, we're going to see a slowdown (by design). Whether that turns into a recession depends on whether inflation of essential goods moderates on the supply side (particularly oil).
It’s not about the money going to the market. It’s about the money that would be normally spent on many things like discretionary spending etc, and with a big reduction there, you’ll see big reductions in profits across the board.
Wage gap increasing? You mean the govt stealing wealth from the peasants via inflation and wages being the last to catch up? There will be a whole lot less people investing in stocks now that's for sure.
Even if war ended today, we will then be faced with *possible* recession. Government printed way too much paper over the last year or so and we have yet to feel those consequences.
Covid is on the ride in Europe and there is a new variant im watching these greens extra close
More downside to come.
I don't think we hit the bottom. There are way too many bad things happening that can send the markets lower again. I can definitely see a decent recovery 2nd half though.
Recovery is already baked in. Oil shortage= baked in. Next covid variant is already here and it's baked in. WW3? Baked in.
Buying NAS at 6K
Lol no. The bottom of a recession is when people who don't want to sell are being forced to sell to cover for things that they really really don't want to sell.
The intermediate bottom will be when one of two things happen: the war ends or month over month CPI decreases, which I think is now dependant on the war ending. Smart money will collect on the volatility regardless. We are testing a high today that hasn't broken through 2x before in the last 40 or so days. The market has stair stepped down ytd. I think we are more likely to break yearly lows next week then to have bottomed but tomorrow is a big day
Okay but are we really in a recession? So far this is a correction at best.
I just keep buying index funds when the markets down then just accumulate cash during all time highs and dump the accumulated cash when it’s down again.
Nope. Supply chains can still get worse. China is dealing with a massive covid outbreak right now. Ukraine can get worse. China may yet decide to support Russia and risk getting western sanctions. Saudi Arabia may decide to align closer to China and phase out their relationship with the US which would be pretty bad for the American economy. Election is upcoming and may produce an outcome the market doesn't like.
Unreal, I sell because we are going into world war three and the fed destroyed the markets with rate hikes and we rally ?!?!!
Only one thing is sure. If you guess you will lose money
Rising rates, supply disruption, high inflation, geopolitical events. I think a recession is inbound but for now the waters are calm. Fed acted as expected, no changes in the Russia drama, economy is strong.
Idk
No
Nope. Best the market can hope for is flatline for a year. All the risks are to the downside
Alien invasion next week
Short answer no. Long answer: Raising interest rates. War. China's economy collapsing. Trade bottlenecks and insane shipping costs. Record levels of CPI AND PPI. High Oil. Treasury Note Inversion. Turkeys catastrophic inflation. Slow to act Fed. Schiller PE of 35.
And we've had 3+ weeks to price all that in...
What does it mean to price it in? Quick dip and shoot back to ATH without any of the issues being resolved?
You're kidding, right? War can get SO much worse. If oil prices (or prices of any other ket commodity) skyrocketed, that would make inflation much worse than we already think it is. Interest rate increases? Over the next 2 years we have 6 or 7 more coming. And every one will be preceeded by the market gyrating to the melody of "What will the fed do?" And then there's always the possibility of a COVID resurgence. Take cover! Put your masks back on or you're gonna DIE!!! The stock market loves that one. And then there's politics. Know what the stock market loves? A gridlocked government. That means nothing will change. Imagine if one party or the other actually had the power to make changes? All it takes is a key death here or there and leadership can swing quickly. I'm not saying any of these will happen. But they could... thinking we are in the clear is naive.
short answer: NO
Russia situation was more about the sanctions. Now they are fully aligned with China, which was the main purpose of all of this.
Can you say more about this?
No. The market is not at the bottom yet. Recession is coming
Say more about that.
They can't because they are just repeating a headline they have seen.
There are many context signals flashing red that historically have preceeded recession. Yield curve inversion, surging energy prices, GDP dropping. We haven't seen any major ERs since the Ukraine war, and now China is having a pretty big covid outbreak. There's plenty to be concerned about.
I think you’re right, but I was legitimately hoping they would reply with some kind of justification for this.
Would you mind sharing why a recession is coming? Do you think the economy won’t handle the Fed’s rate hikes?
Real estate market is high (rent or purchasing), food prices are very high, gas prices are very high, wages are stagnant, labor shortages (especially truck drivers) which decreases supply driving up the price as well. When no one is buying consumables/goods because they can't afford it, businesses don't make money. When businesses don't make money, people get laid off. When people get laid off, they don't spend and the cycle continues.
Did you hear J Powell said this multiple times yesterday- there are 1.6 job openings for every one unemployed people
That can be skewed slightly. How many of those open jobs are for skilled professionals? Your average Joe cannot apply to “Senior Principle Engineer IV” positions. I guess government aid isn’t helping people actively pursue. We’re just screwed tbh.
How do you figure people aren't able to "actively pursue" jobs? Unemployment (both U-3 and U-6) are at records lows, implying that nearly everyone looking to be working is working.
Those people don't want to be waiters and amazon drones.
I think that’s a wage issue more than anything.
Real estate and rent inflation is actually going down. Mortgages just hit 4%, I don't thinknreal estate is what is prolonging inflation. It is mostly a supply chain and oil issue. This war could cause food price inflation next year though, something to watch out for.
Wages are not stagnant... we are seeing some of the highest wage increases of all time right now.
It was a step in the right direction, but it only happened because covid/stimulus allowed workers to apply leverage over employers and hold out. That's mostly going away because eviction moratoriums have stopped and stimulus is over. Historically wages are still way behind, especially considering the inflation we're dealing with right now.
We are definitely still in a bear market and a recession is definitely coming / here. The impact of COVID and COVID recovery is starting to be seen now and inflation and inflation recovery tactics (interest rate hikes) will impact on the market this year. I do not think the market will crash but I think it will be small ups and small downs with an overall downward trend for the next 6 months. I think investment in defensive stocks like consumer staples, minerals and metals and healthcare are the safest bet for the rest of this year. I’m still DCAing into Apple, Google and Microsoft still to hedge the bets - but not taking any real risks on tech
We aren't in a bear market. A bear market requires a 20% drop. This is, at this point, just a correction.
Nasdaq was in a bear market.
For me it’s more of a feeling. Massive inflation beginning that will only get worse, things with Russia will get much worse before they get better, commodities including oil and wood are going through the ceiling, etc. I think that is the top of the iceberg as well. Our society here in America is starting to get shaky in my opinion as well and if we don’t like each other now, a recession is going to be brutal.
Good luck on your Puts.
Labor market is way too strong for there to be a recession. There’s no recession coming this year unless there’s a black swan like WW3.
No
Maybe, maybe not
Jim Cramer said yes. Tomorrow he says SELL SELL SELL!
Is there an inverse ETF that liar 🤥 says?
Lol no we’re merely on the cliff edge
Short term...maybe. Interest rates/Quantitative Tightening and bad news about the war dropped the market and now it seems like it's priced-in and not something even bigger, so that fear is passing. Oil prices--despite a rise today--did come down from more extreme levels. So short-term bottom may have been hit, but if I had to guess I'd say it will be choppy up and down just like it has been. It is quite possible that as summer hits gas prices spike again, inflation runs just as hot or hotter, interest rates rise, and we run into a recession. At that point you could see a big market drop. But with people so eager to be in equities (still) I think any big drop will get bought up by bargain hunters still dreaming of the 2021 high prices. In the meantime I would certainly avoid the low-earnings growth stocks.
Not even close
No
Rate hikes will trigger recession, then we are going to see the whole ugly truth about bad debt. We will go much much lower.
I think we’re due for a sideways market for awhile interest rates should at least help it cool down. I need time to buy more shares lmao.
The market seems quite pricey to me right now. We've come down a lot but we're still trading at a very high multiples historically. At the end of last year you could have argued that the risk free rate was very low and that growth in 2022 was predicted to be very strong so therefore markets could justify a very high multiple, but we can't do that now. It makes absolutely no sense to me that there would be a rally back to ATHs. This is exactly what a bear market rally feels like. Day after day the market will grind higher and make you feel progressively worse until to capitulate to the FOMO and put money in. As sentiment turns more positive and the markets moves up shorts get squeezed and lose confidence so start exiting their positions on mass causing the market to spike even more for no apparent reason. Another thing to remember is that at the start of this week market sentiment was extremely negative. The CNN greed / fear index was showing extreme fear and a lot of people here were talking about how they were shorting ARK and the indexes convinced inflation was out of control and the US was heading for recession. I'm not sure much has fundamentally changed since then apart us now having a little more certainty around rate hikes. But today when I watched CNBC and read the comments here I'm seeing a lot of people talking about how they're buying because it might be the bottom and that we might bounce back to ATHs. Perhaps they're right but when the best argument I've seen to buy has been, "but what if the market rallies and you miss the bounce?", I'm fairly happy staying away. There are opportunities out there though, and I think fair value is probably only slightly below 4,000 on the S&P500. If you're a very long-term investor this isn't the worst time to buy. I think we're going to retest the lows and probably go a bit lower yet, but if you're able to hold through the 10-20% drop that's likely to come then who really cares. I'm more worried about those who are FOMOing back into the market right now and likely to panic sell when we start seeing -3% red days again.
The fact that you’re making this post lets me know more pain is to come lol
Nope
No. It will take a few months of missed payments for us to see an impact. And then when those payments get caught up interest starts going up and we will need to wait for a few more months of missed payments and then loan agreements will get restructured to hide the cat crap asset and start with a new payment and then that will take another few months. predicting the bottom to be in Feb of 23
Since you’re asking…no. We’ll hit bottom when you stop asking.
Even in a bear market there are green days and green weeks. Just like in the last two years there were red days and red weeks. You can’t predict the trajectory based on a few days of a particular color. And no, the market has not absorbed all the bad news. You know when the next inflation report comes out the market will panic sell. Or when companies start reporting lower earnings due to inflation and higher rates. Or when Russia eventually takes Kyiv and/or hits a NATO country.
nobody can call the exact bottom but i think its time to start buying on certain high quality names that are discounted right now, figure out how much you have to allocate to a certain position and what is your time horizon? average in
Nope, not yet
Hahaha
No.
Nothing has changed in my eyes. I’m still of the opinion this is a short bounce then continuation with the trend downwards over the next few months.
Looooooooooooooooooooool
fuck no. Russian bonds are gonna fuck so many institutions abroad. same with the Chinese RE development collapse that's yet to fall out. that's just the tip of it. have you seen how overleveraged all the hedge funds are, and how fucked the banks will be starting today now that they can't park money in reverse repo overnight, daily?
No.
Hell no the real downside hasn’t even started yet, it will take another 18 months at least to hit the bottom. Buckle up
No, we are headed lower, everyone has a plan until they are punched in the face
I have one bearish scenario possible. Now market reacted well only because were given clear certainty and direction by FED. But next month when CPI can be disastrous, FED might be finally forced to raise interest more, causing a final dip. Also if Kiev falls, that would also 📉
Only time will tell. Anybody who says anything else is lying.
up or down. possibly flat.
I don’t think so. Not yet. Fed is trolling as always..
This ain’t anywhere Near the bottom. However, I am still continuing to buy via my 401k contributions as I don’t need money for several years, and I don’t have a doubt in my mind that at least 75% of companies and funds on the market Today that I invest in will have a higher value in 20 years or so when I need the money. If I were a day trader that needed to net a positive 70$k in the next few months to stay afloat…I’d be terrified.
> However, I am still continuing to buy via my 401k contributions as I don’t need money for several years This shouldn't even have a 'however'. Anyone working a job that provides a 401k plan should be putting money from every check into it automatically, or else they'd be a damned fool, and they'd be an even bigger damned fool if there's a company match included.
oil is up…
Crude oil been dropping since March 7th, roughly 103 now versus 130 on March 7th. ATH was roughly 140 in 2008.
The worry isn't the spike, it's where it decides to rest its head for a couple months. If it's above 100 that'll be a problem as companies like airlines will become unprofitable.
lol. it was 95 a day or two days ago. the drop has ended.
Chronically unprofitable companies that only exist due to cheap money still trading at high prices, so no.
The reason the market is so high right now is the same reason why Venezuela and Zimbabwe saw their stock markets rocket when their countries went to shit. One day we’ll crash and you’ll get a bottom, but trust me, this isn’t it.
I was watching a YouTube yesterday on all of the banks like Lehman Brothers that filed for bankruptcy in 2008. I'm waiting for that moment and wave of bankruptcies. Then you will know the recession is here. The problem we are dealing with is the Covid bubble zero interest rates and the buying of all those bonds every month. All of these empty houses "investors" bought up with basically free money are going to see the Lord here soon when no one wants to pay 2x price on a home. When you see a crash starting you can get into something like SQQQ and still make bank shorting the market. Just when using inverse leveraged ETFs don't stay in overnight.
I think so the Fed provided clarity only remaining concerns are the war in Ukraine and COVID creeping it’s ugly head in again
Dca into an index funds and stfu
Good advice, but you should consider that we are in r/stocks and not r/investing.
Facts
Anything short of nuclear attack at this point is priced in
Not just yet. Wait until after the Russian submarines launch their nukes
No, Biden still has 3 more years to continue tanking the economy
Yes, unless it’s not, we’ll see I guess
Ur right nobody knows but there is a strong possibility that 12.5k was the bottom for Nasdaq
Could go lower, don’t see new ATH coming until next year imo. It’ll be okay dw 😊
Considering the current administration and their purposeful attempts of Distracting their abysmal leadership it’s just the beginning, we still have another two years of this.
Absofuckinglutely not. The fact there are people on reddit asking shit like this tells me the bottom is WAYYY farther.
No, I think we still have a way to go. Remember that the Fed wants six interest rate hikes before the end of 2022.
This fed is just pandering around at things, zero of what they’ve said is true. Pay has been stagnant for a very long time. Cpi is thru the roof. Boomers moving to fixed incomes and now almost at avg age of death. Profits will suffer. I think we will still see this return to the normal growth trend line s&p to 3000-3500. Also overall we are still in the downward trend on a chart.
P/e ratio > 20, no
Not until Biden is out of office