Posted on 08/21/2015 5:35:39 AM PDT by SeekAndFind
The stock market just suffered its biggest selloff in a year and a half, as the S&P 500 turned red for the year and the Dow dived 358 points to show a nearly 5% drop for 2015.
In the wake of Thursday’s rout, here are five things that market watchers are tracking as they think aloud about what’s next.
1. Calls for that much-anticipated correction get louder: “Get ready” because a “correction is coming,” warns David Greenberg, president of Schaeffer Greenberg Advisors, in a CNBC commentary piece late Thursday.
He argues the market is “tired and there are a lot of long positions that have gotten in too late.” Greenberg cautions traders against “looking for a bottom or aggressively buying into the next bounce,” instead advising to “lighten up on positions and watch from the sidelines.”
“Selloffs (like another word that begins with s) happen. And no market goes in one direction forever,” he adds in his short but punchy piece.
Many market watchers define a correction as a 10% drop from a peak, and so far the S&P 500 is down 4.5% from its record close of 2,130.82 achieved on May 21.
A growing number of investors have been anticipating a correction, as shown in the chart below. A hat tip goes to Sean D. Emory over at the Market Meter blog for highlighting the chart, as he suggests that it might also be “a nice contrarian starting point.”
2. Chart watchers focus on a key level: The line in the sand for the S&P 500 SPX, -2.11% is around 2,040, according to some technical analysts.
They say if the stock benchmark doesn’t find buyers in this area, then more pain is ahead. The S&P already stands just under 2,040 after closing around 2,036 on Thursday,
(Excerpt) Read more at marketwatch.com ...
More downward direction. Death cross technical indicates a long term correction.
PE ratios need to get down to 12 or better for a buying opportunity to exist.
For your edification?
and the beat goes on....
People get ready, a correction's comin'.
More vacations for Hussein at Martha’s Vineyard.
More desecration of America’s fighting forces.
More surrender to Muslim terrorists.
More surrender to dictators in the Caribbean.
More denigration of the labor force.
More degeneration of the rule of law.
More ignoring of the Constitution.
More shredding of the Judeo-Christian ethic and moral aptitude of the West.
More destruction of wealth, prosperity and free markets.
“investors should wait for autumn”...
When the congress will raise the debt ceiling and increase spending.
Free money for everyone- there’s no problem that politicians can’t solve by spending more.
What’s going to happen next is what usually happens. There will be a war to pump up the military-industrial complex.
Look to North Korea, because that’s where the Chinese will jump in.
More vacations for Hussein at Martha’s Vineyard.
More desecration of America’s fighting forces.
More surrender to Muslim terrorists.
More surrender to dictators in the Caribbean.
More denigration of the labor force.
More degeneration of the rule of law.
More ignoring of the Constitution.
More shredding of the Judeo-Christian ethic and moral aptitude of the West.
More destruction of wealth, prosperity and free markets.
Do you remember the late 70's? I remember driving home from work listening to the radio and hearing DOW trading volumes in the 20 to 30 million range and sometimes even less.
What’s next? Friday!
Remember, back then stock trading was done by hand and very slow (by 2015 standards) mainframe computers. That’s why 30 million shares traded was a lot in those days. Today, billions of shares get traded in a matter of seconds, thanks to modern supercomputers and much faster computer networks (much of it not connected to the public Internet).
Yeah, significant bottom break out on the lower Bollinger bands would indicate a strong downward trend.
I see the first support test for the DOW at 16000. If it drops below that with any velocity, 13,000 and even 12,500 becomes a real possibility.
It sucks if you are on margin.
Otherwise, chill.
I look at new highs vs. new lows trend. It is not bearish yet and has a ways to go before it triggers. If it triggers, there’s only a one in three chance that action will pay off.
Plus it is August and September, bad market months in general.
Kiss the rate hike goodbye. :-)
Look for buying opportunities in strong companies with a consistent dividend payment history. Also, look at what they produce and the demand for such products/services in an economic slowdown. As a retiree, I now focus on dividend stocks versus growth stocks. My intent is not to accumulate as much as provide an income stream. My greatest risk is to inflation so I do have a smaller percentage allocated to growth. Unfortunately my assets are primarily in my IRA and I have to take withdrawals or pay additional tax yearly. This means my annual income will decline with age. Hence my wife and I are trying to do as much on the bucket list as we can while “young” and refuse to incur debt. We moved from a high COLA (cost of living area) to a lower COLA so we could have a home without a mortgage for the first time in our lives. So far this strategy has worked well for us and we don’t miss the traffic of congested city life.
DOW down 250...
People right now are just doing massive profit-taking after the run up to over DJIA 18,000 back in June.
The tender box is primed and prepared for war about to break out.
Russia just sold advanced missiles to Iran and the window for Israel to take out those nukes sites is closing fast.
But even if Iran closes the straight of Harmuz I am not sure that would prop up oil prices.
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