Chariot Share Discussion Threads

[andonis] 12/10/2009 21:43

The turn is neigh


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[andonis] 12/10/2009 20:09

yea as I said after the high a low. But we have not seen a lower low yet. Only then we have reversal. So far it is still uptrend although the fall looks sharp.

[navyan] 12/10/2009 19:37

DOW is falling...


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[navyan] 11/10/2009 18:44

V interesting Andonis, the unemployment will keep going up and peak at 3M next year.

[andonis] 11/10/2009 18:26

I have posted this here before...(www.technicalspeculator.com )


1. Recession. A decline in the real GDP that occurs for at least two or more quarters. Recessions feed on themselves. During a recession, business people spend less than they once did. Because sales are failing, businesses do what they can to reduce their spending. They lay off workers, buy less merchandise, and postpone plans to expand. When this happens, business suppliers do what they can to protect themselves. They too lay off workers and reduce spending. Unemployment starts to rise (Chart 2).
As workers earn less, they spend less, and business income and profits decline still more. Businesses spend even less than before and lay off still more workers. The economy continues to slide.

2. Low Point, or Depression. State of the economy where there are large unemployment rates, a decline in annual income, and overproduction. The time at which the real GDP stops its decline and starts expanding; the lowest point. Sooner or later, the recession will reach the bottom of the business cycle. How long the cycle will remain at this low point varies from a matter of weeks to many months. During some depressions, such as the one in the 1930s, the low point has lasted for years.

3. Expansion and Recovery. A period in which the real GDP grows; recovery from a recession. When business begins to improve a bit, firms will hire a few more workers and increase their orders of materials from their suppliers. Increased orders lead other firms to increase production and rehire workers. More employment leads to more consumer spending, further business activity, and still more jobs. Economists describe this upturn in the business cycle as a period of expansion and recovery.

4. Peak. The point at which the real GDP stops increasing and begins its decline; the highest point. At the top, or peak, of the business cycle, business expansion ends its upward climb. Employment, consumer spending, and production hit their highest levels. A peak, like a depression, can last for a short or long period of time. When the peak lasts for a long time, we are in a period of prosperity.
The stock market (Chart 3) is a well proven leading indicated on the business cycle and normally leads by 6-9 months. The rise and fall of sectors within the equity markets provides ample clues to the investor of the correct phase of the business cycle.

For example, if a time slice from the last 2-3 months were examined closely, the following economic and stock sector evidence would be found. Interest rates are now falling (Chart 1). Gold and oil are making all-time highs. Defensive groups such as health care and staples are some of the top performing groups. Financials and discretionaries have started declining months ago (both are leading indicators on the stock market). Basic materials and consumer goods are trading flat. All of this data would suggest a peak in the economy has developed and that the stock market (usually 6-9 months behind the economy) has already topped. Technical models indicate the crest for global markets was in October.

Bottom line: The current fundamentals of a company can be greatly influenced by the surrounding economy. By understanding the basic structure of the business cycle, investors can determine the present position of the cycle and anticipate a weaker or stronger economy in the near future. The business cycle has one of the strongest influences on the present and future earnings of a organization.

Investment approach: Portfolios should be weighted toward sectors that have proven strength in economic contraction periods. This includes defensive groups, utilities and pharmaceuticals. Investors should also consider under weighting transportation, technology, basic industry and capital goods. These last groups usually perform poorly during economic slowdowns.

[navyan] 11/10/2009 18:13

which currently is... the gold sector.

[andonis] 11/10/2009 18:12

perhaps so in gold or cash...you buy the seasonal sectors which lead the market.

[andonis] 11/10/2009 18:11

well depends on the investment time scale. If you are looking for years then you do not worry about a few months of coming lower but rising afterward. If you follow the indices then you expect a fall so you can rid of some and then buy lower.

[navyan] 11/10/2009 18:10

well, lets say the equity market will fall, okay? and big sell off, but where all the money goes? they will go to safe heaven, the gold market, push price of gold even higher, so does the price of gold stocks. so you can buy gold stock if you betting on the general equity market falls?

[navyan] 11/10/2009 18:07

really? tell u the truth, I did the same thing couple of times in the last three month, but everytime I sold all stocks cos the chart tells me the W shape is coming, but it just kept going up, the market is overbought, but nobody knows when the bubble will bust.

[andonis] 11/10/2009 18:05

I will buy probably in January. (Wait to see how the fall develops....)

[andonis] 11/10/2009 18:03

time to go short not to buy m8

[andonis] 11/10/2009 18:03

I sold the lot...I wont buy now!!! Bad time... when the market is at a high!

[navyan] 11/10/2009 18:01

do u buy shares as well? got any hot tips?

[andonis] 11/10/2009 18:00

Thats why I do not listen to news...as the chart cycles for example, includes news which will affect the price. Furthermore, one cannot estimate the strength of rise based on news alone, or indeed mixture of bad and good news.

[andonis] 11/10/2009 17:58

well, if the chart falls, it includes the LOT. All the reasons for falling,....emotional, financial, shock, disaster, poor performance, everything..

[navyan] 11/10/2009 17:55

I like both, they both delicious...

so you think the BAD news is already on the chart then?