Bull or Bear? BTFD or STFR? TA look at Market direction

[Breezy]

I'm selling so I can bank my profits before they all disappear into thin air.  They were hard earned this year.  Then I will wait for the bear market to be over, or for another bear market rally to kick off. 

Well yes if you can do that then all good but I'm guessing a lot of people are seriously in the red atm.

[KW]

Well yes if you can do that then all good but I'm guessing a lot of people are seriously in the red atm.

They've clearly not been following my Momentum Investing thread 

[Breezy]

They've clearly not been following my Momentum Investing thread 

Dont you mean Momentum trading, after all your intention and motive is purely to make a profit not to collect dividends.

[KW]

Dont you mean Momentum trading, after all your intention and motive is purely to make a profit not to collect dividends.

Nope.  My intention is to remain invested, so long as the market is amenable.  Investing doesnt mean being forced to lose money because you won't sell. It is intention at the time of purchase that is relevant to the distinction between investing and trading, not when and why you sell.  Like Mayard Keynes said "when the facts change, I change my mind. What do you do Sir?"
Or his actual direct quote ....
"Unfortunately, it is not possible to make oneself permanently secure by any policy of inaction whatever. The idea which some people seem to entertain that an active policy involves taking more risks than an inactive policy is exactly the opposite of the truth. The inactive investor who takes up an obstinate attitude about his holdings and refuses to change his opinion merely because facts and circumstances have changed is the one who in the long run comes to grievous loss."

[Breezy]

Nope.  My intention is to remain invested, so long as the market is amenable.  Investing doesnt mean being forced to lose money because you won't sell. It is intention at the time of purchase that is relevant to the distinction between investing and trading, not when and why you sell.  Like Mayard Keynes said "when the facts change, I change my mind. What do you do Sir?"
Or his actual direct quote ....
"Unfortunately, it is not possible to make oneself permanently secure by any policy of inaction whatever. The idea which some people seem to entertain that an active policy involves taking more risks than an inactive policy is exactly the opposite of the truth. The inactive investor who takes up an obstinate attitude about his holdings and refuses to change his opinion merely because facts and circumstances have changed is the one who in the long run comes to grievous loss."

Whatever your happy with and can justify in the event of a tax audit i guess, the question is would your intention stack up in the light of your subsequent actions? I'm not the one you have to convince.

[KW]

Whatever your happy with and can justify in the event of a tax audit i guess, the question is would your intention stack up in the light of your subsequent actions? I'm not the one you have to convince.

I've been audited and there were no issues.  Intention is not determined at the time of sale by hindsight, its what is provable at the time of purchase. Subsequent actions are not material if the reason for those actions did not exist at the time of purchase.  If I purchase shares in the belief that we are in a new bull market, and that my capital is safely invested, and it turns out that I am wrong, and my capital is now significantly at risk, selling those shares to preserve my capital does not suddenly make me "in the business of trading" assets.

[Breezy]

I've been audited and there were no issues.  Intention is not determined at the time of sale by hindsight, its what is provable at the time of purchase. Subsequent actions are not material if the reason for those actions did not exist at the time of purchase.  If I purchase shares in the belief that we are in a new bull market, and that my capital is safely invested, and it turns out that I am wrong, and my capital is now significantly at risk, selling those shares to preserve my capital does not suddenly make me "in the business of trading" assets.

We are ALL in the business of trading assets, its just the time-frame in selling those assetts that differs. A CGT captures ALL those intentions and timeframes and does away with any grey tax law like we have in NZ, not that I'm in favour of a CGT but I can see its almost universal appeal to Governments.

[KW]

Its been a while, but the hi/lo chart has finally gone positive again. This indicates that some breadth is returning to the market, and the smaller stocks (ie. everything except the mega cap tech stocks) are finally moving in the right direction. 

[Left Field]

Much depending on the outcome of US debt ceiling discussions and the Republicans motives before I'm bullish.

[KW]

Probably wise.  Some stocks are starting to look like they are pricing in recession - retail stocks in particular.  Companies like PMV and LOV (best in class) have now broken trend and are back trading below their 200 day MA.

Over in the US both the Dow and Dow Transports are below their 200 day MA, although the Dow is not as broken as the Transports, but Dow Theory says they need to be in sync, and it looks more probable that the Dow will catch down to the Transports rather than the other way round. 

Hi/Lo is back in the red, so this may have been signalling a market top rather than a change in trend.  Balanced against this is that new market leaders always "climb a wall of worry" to start a new bull market, although in the current case the new leaders appear to be the same as the old leaders .  This is what happens when you allow all the big tech companies to buy up all the smaller tech companies and control everything.

If the market comes out of it quickly, and the hi/lo goes back to being positive in a few days/weeks, then one can assume that this is just a correction, not a new bear leg. 

[KW]

Looks like the rally is in full swing (at least in the US) with a strong positive move on the Hi/Lo last night.  My gut tells me the ASX is picking up as well, with some big moves in beaten down stocks that have now had the time to form bases from which to break out of.  I'm opening positions again 

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[BlackPeter]

Looks like the rally is in full swing (at least in the US) with a strong positive move on the Hi/Lo last night.  My gut tells me the ASX is picking up as well, with some big moves in beaten down stocks that have now had the time to form bases from which to break out of.  I'm opening positions again 

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Actually - no need to look that far across the oceans ...

While many of my European stocks are already for months in the "green zone" (above MA200) and US now following (as you indicated), I noticed as well for a number of NZ stocks green shoots.

Some listed properties (e.g. Argosy) breaking out of falling wedges ... and some retirement stocks (e.g. ARV) already above MA200.

Spring coming early this year? Maybe the impact of global warming

[KW]

Actually - no need to look that far across the oceans ...

While many of my European stocks are already for months in the "green zone" (above MA200) and US now following (as you indicated), I noticed as well for a number of NZ stocks green shoots.

Some listed properties (e.g. Argosy) breaking out of falling wedges ... and some retirement stocks (e.g. ARV) already above MA200.

Spring coming early this year? Maybe the impact of global warming

I know, the DAX is at all time highs!  And I thought there was a war on LOL

Hopefully Spring has Sprung.  I am cautiously optimistic, and mindful of the old adage "a bull market climbs a wall of worry" so you cant wait until all the worries are gone (debt ceiling, recession, war, inflation).  Now its about being "well positioned" 

I invest mainly in high growth stocks so really need the US market to fire to give a tailwind to the ASX growth sectors.  And the money flow has to come in to stocks other than the mega caps (hence the focus on market breadth).  With interest rates looking at or close to peak, and cuts on the horizon now, that tailwind for growth stocks looks to have arrived.  

[Mr Cashflow]

I am looking for low-debt strong balance sheet companies during uncertain period like today. I like tomorrow's darlings. High ROE, Cash flow and Great Value are my friends

I know, the DAX is at all time highs!  And I thought there was a war on LOL

Hopefully Spring has Sprung.  I am cautiously optimistic, and mindful of the old adage "a bull market climbs a wall of worry" so you cant wait until all the worries are gone (debt ceiling, recession, war, inflation).  Now its about being "well positioned" 

I invest mainly in high growth stocks so really need the US market to fire to give a tailwind to the ASX growth sectors.  And the money flow has to come in to stocks other than the mega caps (hence the focus on market breadth).  With interest rates looking at or close to peak, and cuts on the horizon now, that tailwind for growth stocks looks to have arrived. 

[Left Field]

Michael Burry of "The Big Short' fame is forecasting a market crash.

https://edition.cnn.com/2023/08/15/investing/michael-burry-stock-market-crash/index.html

Michael Burry, the "Big Short" investor who became famous for correctly predicting the epic collapse of the housing market in 2008, has bet more than $1.6 billion on a Wall Street crash.

Burry is making his bearish bets against the S&P 500 and Nasdaq 100, according to Security Exchange Commission filings released Monday. Burry's fund, Scion Asset Management, bought $866 million in put options (that's the right to sell an asset at a particular price) against a fund that tracks the S&P 500 and $739 million in put options against a fund that tracks the Nasdaq 100.

Burry is using more than 90% of his portfolio to bet on a market downturn, according to the filings.