World Indices Roundup 2019

Discussion in 'Sharemarket News & Market Analysis' started by keroppi, 6th Jan, 2019.

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  1. kitdoctor

    kitdoctor Well-Known Member

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    Thanks for your post. I've posted my current interpretation of the Elliott wave count for the Dow Jones Industrial Average (DJIA or code DJI). It does not show an alternative wave count (although I have one). I have not posted any Elliott wave counts for the S&P 500 (code SPX) or SPDR S&P 500 (code SPY), or made any comment on these, have I? However, as you've asked there are alternative wave counts for the DJI and SPX that do interpret the falls from their 2018 highs to their December lows as corrective waves (A-B-C) rather than motive waves.

    I've also posted my current preferred and alternative wave count for the S&P ASX 200 (code XJO). My two wave counts and formations have the low of 24 December 2019 as a floor going forward for 2019. It will be a very choppy path though. I do know of a third alternative wave count that would see the low breached but I disagree with that count.

    Soon there should be a pull back in the S&P ASX 200. Watch the commentators as they will link this to the findings in the Royal Commission report due out 1 February. Perfect timing! This is how 99999 out of 100000 people think. This will not be the cause of the pull back. The pull back is simply the cycle of waning or declining collective social mood that will eventually be followed by waxing or increasing collective social mood.

    Adhering to the teachings of RN Elliott requires that all markets are analysed independently. Drawing relationships between one market and another needs to be done very carefully. For example, I have drawn a relationship between the S&P ASX A-REIT and the CoreLogic Daily Dwelling Index. Here I'm confident that the relationship is valid because they are both essentially representing the same thing - collective social mood in Australia as a whole. I say essentially because technically the Corelogic Index only covers five capital cities. The former is a more current meter of social mood (as is the S&P ASX 200) and the latter is a lagging sociometer. Often a relationship will establish between two markets and then eventually breakdown.

    I personally would not draw a relationship between SPX (or SPY) and S&P ASX 200. The former is a sociometer for the USA as a whole and the latter a sociometer for Australia as a whole. Let's say the S&P 500 was steadily climbing over a period of months and S&P ASX 200 was also steadily climbing over the same period. I would explain this in the following way. Social mood in the USA is rising and becoming more optimistic and social mood in Australia is rising and becoming more positive. I would not read anything more into it than that. Also when I use the word mood I do not mean emotion/s. Mood is endogenous (arising from within).

    I hope this answers your questions.
     
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  2. keroppi

    keroppi Active Member

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    @kitdoctor thanks for the explanation. I am new to Elliott Wave Analysis and taking time to learn how your interpret the markets.

    1. I presume you meant 'My two wave counts and formations have the low of 24 December 2018 as a floor going forward for 2019'. Is this correct?

    2. Regarding DJIA, do you believe we are still in the middle of down wave 3 (with wave 2 having finished on 3 December 2018), and if so what level do you expect wave 3 will finish at and when do you expect wave 3 to finish?

    2a. Related to this, could 24 December 2018 have been the end of wave 3 for DJIA and now we in the up wave 4?

    3. Regarding the final wave c for XJO, do you seriously anticipate it falling to the ~900 level? I notice you made 3 predictions in your spreadsheet. How many predictions have you made prior to that and what percentage of your total predictions turned out to be correct to within 10%?
     
    Last edited: 26th Jan, 2019
  3. kitdoctor

    kitdoctor Well-Known Member

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    Q1. Yes "...24 December 2019..." should have been "...24 December 2018..." in my post.
     
  4. Alex Straker

    Alex Straker Financial Life Coach Business Member

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    Very good questions....tough to answer.

    Unfortunately forecasting every wiggle is nigh on impossible and as one of my mentors is well known for saying....."You can only realistically expect to identify a clear Elliott count 50% of the time in any market".

    The support levels were my best estimate for the completion of the recent down legs. The market fell short of these by a relatively small amount. I believe @kitdoctor said he had a similar expectation for a deeper move. It is very difficult to say whether the market will go there now, the likelihood has diminished a little and new support levels may emerge from the new market structures being formed since that last forecast was made.

    Agree that market is likely to turn down again in FEB. The key pieces of info coming next and then later this year is how far down will the FEB leg take things and will the DEC18 low hold for 2019? Whether the low gets taken out or not, the next leg down is a very important if you consider each scenario.

    1. IF DEC18 low holds, this next leg down will be the last chance to get in.
    2. IF DEC18 low does not hold, next leg down represents a deeper discount and we can still expect some support at the levels mentioned.

    @kitdoctor thanks again for all your input. I am a bit clearer on your count now, would be keen to discuss some things with you privately.
     
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  5. keroppi

    keroppi Active Member

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    @Alex Straker I just wish to clarify what you mean by 'get in' when you say 1. IF DEC18 low holds, this next leg down will be the last chance to get in.

    Buy 'get in', do you mean it is the last chance to buy or sell the SPY?

    IF DEC18 low does not hold, then am I correct to say that you still anticipate support from buyers around 2,242?
     
  6. Alex Straker

    Alex Straker Financial Life Coach Business Member

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    @keroppi Get in meaning buy and 'last chance' needs to read in context of 2019 :)

    Yes that support is still valid as I said in the previous post.

    No advice.
     
  7. Speede

    Speede Well-Known Member

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    All these charts, patterns and all that crap................people follow......would love to see how many profitable traders EXIST....after 2 years...........1 out of 10 million probably.

    Simply put...buy and hold......don't even waste your time with trading.
     
  8. PandS

    PandS Well-Known Member

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    Everything has its place if you know what you are doing, I buy and hold a lot of stocks for dividend and I also trades (index and individual stocks) and the trades actually been very profitable for a long time now, I made money both up and down market, when fundamental combine with my charts said Short I go short, when it said long I go long, If both said 50/50 I stayed out and wait for the union, only go in when it in union, no second guess when the system is in place

    You can't make money following someone else system, you got to come up with your own
    someone can make a lot of money using certain techniques but that fit his/her risk profile, available capital, whatever other hedging/position he has in place etc... only you know yourself what system fits you best.

    Nothing wrong with ignoring charts, buy and hold if that fit your profile, find your edge and sticks with it, there is no right or wrong way, find your edges and be prosper.
     
  9. Barny

    Barny Well-Known Member

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    May I ask if you have beat the index over the year buying and selling individual stocks, if so by how much. Just curious if it's all worth it or not.
     
  10. PandS

    PandS Well-Known Member

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    I start serious in 13/14, that when i start tracking performance, no more properties just purely stock market
    Still keep eye on the properties out of interest and will get back in when everyone stopping buying and lose money

    18/19 is only half way in, so far my return average 13.29% a year
    not sure if that beat the market or not but I aiming for 10% return a year if
    I can do better than that I am super happy, I based my retirement on 6-8% return a year.

    13/14 14/15 15/16 16/17 17/18 18/19 Total
    IRR 15.33% 9.77% 21.70% 10.03% 12.76% 7.55% 13.29%


    13/14 was my bad year I have an excuse for that, I cashed out a fair bit to upgrade PPOR with little debt and I just spend time looking at properties and go and inspect properties every weekends for a few months and nothing else.

    That why I dont like properties any more too much hassle, found my call in the market and love it and absolutely no hassle and the return is more than decent
     
    Last edited: 31st Jan, 2019
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  11. Barny

    Barny Well-Known Member

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    Mate that's fantastic, well done
     
  12. PandS

    PandS Well-Known Member

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    also these are return after tax and fees by the way, I paid capital gain each year :( to subsides you -ve gearing people, but hey that is life who cares envy and bitterness goes no where
     
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  13. Alex Straker

    Alex Straker Financial Life Coach Business Member

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    The post quoted above was written on 3 May 2018 and is based on Gann forecasting methods (that I won't be posting here) using repeating historical patterns and is completely different in method to the geometry based work. Again these don't usually have the precision of the geometry methods but they do provide timing guidance for the 'major moves' .

    We have obviously just passed the first date forecast for a major low and had a little time to observe the market.

    Forecast date was 21DEC18

    Actual lows
    XJO - 24DEC18
    SPY - 26DEC18


    No advice.
     
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  14. itsmescottyc

    itsmescottyc Well-Known Member

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    @Alex Straker
    In the context of the current long term pattern, will the forecasted highs/lows above include retracement wave C of 2 and the large context wave 3 (bull leg) that follows, or does this come further down the track?

    If so, it would suggest that one of the greatest accumulation opportunities of our time is approaching...
     
  15. kitdoctor

    kitdoctor Well-Known Member

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    @keroppi I became interested in technical analysis approaches including the Elliott Wave Principle after the GFC. My superannuation took a whack of 15%, so I was determined to avoid that happening again as I approached retirement! That seems like a long time ago but it's not in terms of the larger degree Elliott waves that operate over that type of time frame or longer. The three forecasts in my table span the time period early 2009 to late 2018, almost a decade.

    As I said before I don't trade stocks. To do that successfully requires an enormous amount of time. Just doing what I do which is more about understanding long-term patterns and cycles to guide strategic timing decisions takes a lot of time which I'd say most people couldn't commit to.

    I still see 2021 +1 or - 1 year as being a year or years where there will be important turning points in XJO/XAO. I know that could be said to be hardly a forecast as it spans 3 years but this is being made in 2019 and of course I adjust this as time passes.

    The bearish Elliott wave case is that Intermediate wave (5) of Primary wave C (circle) of Cycle wave b finishes in 2020. My understanding of the current state of residential property cycle tells me this bearish case could be wrong. So, for example 2020, could be the end of Minor wave 3 of Intermediate wave (3) of Primary wave C (circle) of Cycle wave b or the end of Intermediate wave (3) of Primary wave C (circle) of Cycle wave b.

    I have done some simple work considering Fibonacci sequences and this also points to 2021 + or - 1 year as being a year or years where there will be important turning points in XJO/XAO.

    I am also drawn to W D Gann's work. I am not an expert in this but my analysis using his approach also points to 2020 being a year where there will be an important turning point in XJO/XAO.

    If you remember I mentioned alternative wave counts for DJI, SPX. The problem is that there is not enough panic being displayed in the market yet. A little part of me is telling me we could be in a mini-crash like 2000-2003 (2002-2003 in Australia). Yes more downside potentially ahead but then a period like 2003-2007.

    If I was to summarise all my analysis (for Australia), I see an important high in 2020 or 2021 then a low heading into 2022 then a final upward swing to a major high into 2024 or 2025. Credit and debt levels have to build further before the next crash of a 2007 type scale is due.

    I hope this is of help.
     
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  16. Alex Straker

    Alex Straker Financial Life Coach Business Member

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    Great info thanks!

    I know many of you have heard me say what I am about to say already.....

    Just want to add that similar to @kitdoctor says here I too advocate that using charting info does not have to equate with a 'trading' approach. As I have said in many posts before, the information we use in charts is just as powerful for accumulation based strategies and will lead to a true advantage (or 'market edge') if you are prepared to put in the work, time and study as @kitdoctor has.
     
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  17. Alex Straker

    Alex Straker Financial Life Coach Business Member

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    @itsmescottyc not sure which specific market you are meaning here my friend :)

    If XJO, yes this is a very important phase now. @kitdoctor may well be right and this recent low could be the important water mark until 2020 and infers that we can consider looking for entries on any retracements towards that low again. In a broad index context waiting until under 5,700 again is good and the closer to 5,400 the better.

    Remember the index is only a broad brush guide. If you are accumulating in to stocks, it is best to consider the technical picture of each stock individually to get the best information.

    The other possibility I remain aware of is that the low gets exceeded (or very nearly) during later during 2019, this would most likely come late this year (approx DEC19 - same thing I have been saying repeatedly here for around a year now). So in summary the XJO 2019/2020 road map from here - most likely drift higher in to JUL/AUG 2019 then down in to NOV/DEC 2019 for a major low. Following this most likely higher again until approx NOV 2020.

    No advice
     
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  18. kitdoctor

    kitdoctor Well-Known Member

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    Explained perfectly!
     
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  19. itsmescottyc

    itsmescottyc Well-Known Member

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    @kitdoctor @Alex Straker appreciate the insights gentlemen.

    I'm currently in a situation whereby I'm seeking to invest a significant sum (to me) directly into the old school Australian LICs, so I'm certainly focussing more towards XJO performance.

    I'm not overly concerned about timing the market to perfection but given some of the data in this thread suggesting a potential 'GFC style' event in the coming years, I'm sure I'm not the only one trying to gage when this is most likely to occur.

    If one can wait a year or two and pick up twice as many units, then I'm certain most would be tempted!

    Of course timing the market is a fools game but some of the data is eye opening to say the least.

    Again, really appreciate the insights.
     
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  20. Alex Straker

    Alex Straker Financial Life Coach Business Member

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    It's a pleasure, I find it a fascinating thing using past information to predict the future!

    BTW 'Timing to perfection' is near impossible even for an experienced & highly skilled TA practitioner. Thankfully it is not even the slightest bit necessary, as even getting in somewhere close to the ideal price and time zone puts you miles out in front of the average investor ;)
     
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