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Where is the DJIA bottom?

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    Where is the DJIA bottom?

    So here we are somewhere in the Covid19 crisis. Whether we at the beginning, middle, or end isn’t known. Where does the DJIA go for its lowest bottom? I think we see another 30-35% downside. 13-14,000 before things are over. A lot of S&Ps going into bankruptcy.
    Never underestimate the power of stupid people in large groups.

    -George Carlin

    #2
    The only thing of which I'm confident is that, on the day the market finally bottoms out, everyone's assumption will be that it still has farther to fall.

    Perhaps to prove my own point, yeah, I think this has a ways to go. I don't think we've yet seen even the first data points of the economic effects (jobless claims, unemployment rates). Widespread testing for the virus only started ramping up this week, so we expect the number of confirmed cases to spike (which is both good and bad news). It seems like we are several days away from seeing to what extent we're going to repeat Italy's example

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      #3
      Technically, the bottom is zero. Im sticking with that number.

      Also, why is everyone obsessed with the Dow? Doesnt that only represent 30 companies? I always go by the S&P...since that consists of 500 companies. But, the s&p has a smaller number, and people like to see bigger numbers.
      Last edited by rennigade; 03-18-2020, 03:24 AM.

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        #4
        It is getting tempting to just dump a bunch of cash into an S&P or Total Stock Market fund and be done with it. Then stop looking and ignore it for a while.
        Steve

        * Despite the high cost of living, it remains very popular.
        * Why should I pay for my daughter's education when she already knows everything?
        * There are no shortcuts to anywhere worth going.

        Comment


          #5
          Originally posted by disneysteve View Post
          It is getting tempting to just dump a bunch of cash into an S&P or Total Stock Market fund and be done with it. Then stop looking and ignore it for a while.
          I was soo close to this sentiment the other day. Thankfully I listened to a few JL Collin's interviews on different podcasts, and he got me back to my rational senses.

          I've decided to move to a "weekly" dollar cost averaging strategy. And while no one knows when this will be over, I'm going to base my calculations on a 6 month loop for now, or 24 investments. Currently going to target $500 a week, and just keep pumping it back in as long as possible. I may consider bumping it up/down as the market struggles to stabilize.

          This is essentially my normal strategy, but slightly more aggressive, and increasing the frequency of investing days from monthly --> weekly. I think this is as savy as I would like to get, to catch all these troughs and crests.

          I really wanted to toss in everything I took back out right away and stop the choice paralysis/ endless opportunity cost calculations. But the reality is, this could get Much Worse/Better very quickly. And in my opinion, there is much more risk towards it all going lower than higher. So i'm getting in more of a marathon investing mode. Just sucks because wife and I are down 1 income, so we are pumping money in through a different avenue.

          I am considering looking @ my retirement account (that follows the 3 fund pretty strictly) and I may be doing some rebalanceing. (Selling bonds funds that havent been hit as hard, and replacing the % w/ Total stock market index, which in theory should catapault my growth probability higher as the market eventually rebalances). Not a bad time for me to sell @ gains either, as this is a much lower income year for me w/ the resignation and all.

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            #6
            Q1 earnings releasing soon.
            Not sure if that has been priced in or not.

            We might be treading near bottom now.
            It depends how long this drags on....
            Brian

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              #7
              There is psychological support at 20K, so hopefully that holds.
              Never underestimate the power of stupid people in large groups.

              -George Carlin

              Comment


                #8
                Originally posted by TexasHusker View Post
                There is psychological support at 20K, so hopefully that holds.
                I will never fully understand that mindset. 20,000 is no different than 20,100 or 19,900. It's just a number. I understand that it's a big round even number but it's still just a point on a line.
                Steve

                * Despite the high cost of living, it remains very popular.
                * Why should I pay for my daughter's education when she already knows everything?
                * There are no shortcuts to anywhere worth going.

                Comment


                  #9
                  Originally posted by amarowsky View Post
                  I've decided to move to a "weekly" dollar cost averaging strategy. And while no one knows when this will be over, I'm going to base my calculations on a 6 month loop for now, or 24 investments. Currently going to target $500 a week, and just keep pumping it back in as long as possible. I may consider bumping it up/down as the market struggles to stabilize.

                  This is essentially my normal strategy, but slightly more aggressive, and increasing the frequency of investing days from monthly --> weekly. I think this is as savy as I would like to get, to catch all these troughs and crests.
                  This is mostly what I've started doing as well. It may simply be lying to myself, but I feel like having some established guidelines for myself will help to keep me from making any one huge mistake, and spread out over time the significant risks inherent in the market right now.
                  - Roth IRAs are now set for weekly contributions vs. bi-monthly, and are now on pace to max out by June vs. December.
                  - Taxable brokerage is getting $1k-$2k/week
                  - New limit orders setup either weekly (set above previous limit price if they were not executed), or with new limit orders setup after most/all of the existing orders have executed.
                  - Set limit price ~2-3% below current share prices, to take advantage of volatility while giving the orders a reasonable chance of executing within a week or so (this rule is obviously designed for the aggressively downward-tending market. As things level off & volatility reduces, I'll likely have to set limit prices around .5% - 1% below current prices.
                  "Praestantia per minutus" ... "Acta non verba"

                  Comment


                    #10
                    Originally posted by disneysteve View Post

                    I will never fully understand that mindset. 20,000 is no different than 20,100 or 19,900. It's just a number. I understand that it's a big round even number but it's still just a point on a line.
                    It is just a number, but a big psychological number it is. December 25th is also just a date, but we go a little crazy there, too.
                    Never underestimate the power of stupid people in large groups.

                    -George Carlin

                    Comment


                      #11
                      Originally posted by TexasHusker View Post
                      There is psychological support at 20K, so hopefully that holds.
                      Nope. It dropped past 20K.
                      Steve

                      * Despite the high cost of living, it remains very popular.
                      * Why should I pay for my daughter's education when she already knows everything?
                      * There are no shortcuts to anywhere worth going.

                      Comment


                        #12
                        Originally posted by disneysteve View Post

                        Nope. It dropped past 20K.

                        That is a concern, but I think it will end the day north of that. If it gets down below that and stays there, that is very bearish.
                        Never underestimate the power of stupid people in large groups.

                        -George Carlin

                        Comment


                          #13
                          Originally posted by TexasHusker View Post
                          That is a concern, but I think it will end the day north of that. If it gets down below that and stays there, that is very bearish.
                          I think we (the market) have already well established that we're very "bear-y" right now, regardless of any indicators or indices... 20K Dow is a psychological stop, but the panic selling is a far stronger psychological motivator. Until either there appears to be some real progress on controlling the virus, or investors wake up to realize that they're dramatically overselling the market, no arbitrary number is going to mean much.
                          "Praestantia per minutus" ... "Acta non verba"

                          Comment


                            #14
                            Originally posted by TexasHusker View Post


                            That is a concern, but I think it will end the day north of that.
                            That's not looking so good right now. The daily press conference didn't help.
                            Steve

                            * Despite the high cost of living, it remains very popular.
                            * Why should I pay for my daughter's education when she already knows everything?
                            * There are no shortcuts to anywhere worth going.

                            Comment


                              #15
                              Bill Ackman on CNBC on 3/18/20, shut down America for 30 days. I agree. https://www.cnbc.com/2020/03/18/bill...-down-now.html

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