Get started

Stockmarketcrash2020

SPX500 - time to go down?The candle from last night should be a proper signal, having broken the previous top now turned support, that further downside is expected. I am also seeing a completed ABC correction with C being higher and a temporary price top has been set. We should see movement down as vaccine hopium and post election swag is wearing off. Besides, RSI is nowhere while we had these huge green candles and volume is somewhat scarce so I don't trust this breakthrough.
OANDA:SPX500USDShort
by badbeatnuts
Why Did The Stock Market Crash?Last Wednesday, I warned during my live show that the market could crash soon. And it did... The next day the NASDAQ lost more than 5% – and for the next few days it kept moving lower. And not to brag, but I pretty much nailed my prediction: I said the S&P would correct to 3,400 and then bounce back. Well, I was off by a few points. It went down to 3,330 and then bounced back. Close enough 🙂 So why did the stock market just have a bit of a flash crash? And will they keep crashing, or is the worst over now? In order to answer the question “why are the markets crashing,” let’s back off for a moment and discuss why stocks exist in the first place. At some point, a company may need to raise capital, and they don’t necessarily want to borrow it from the bank. So they sell parts of the company to investors, and these are shares. Let’s take a look at a company like Apple AAPL. They have issued 17.1 BILLION shares. Now let’s compare this to another company that has been incredibly popular this year, Zoom Communications (ZM). They have issued 194.76 Million shares. As you can see, that’s much less. EPS And A Market Crash? So in order to compare these 2 companies, smart people (way smarter than me) came up with the idea of creating a metric, the EPS, or Earnings Per Share. This metric tells you how much a company earns per ONE share of stock that they issue. So for AAPL that’s $3.30 and for ZOOM that’s $0.78. As you can see, AAPL is much more profitable per share that they have issued compared to ZM. No surprise. Now… what does THIS all have to do with the market crashing? Bear with me… you’ll see in a moment. So now you know about the “EPS” – the Earnings Per Share. The next key metric that you need to know is the “P/E” ratio. PE Ratio or Price Per Earnings The PE ratio is the “price per earning,” so you take the stock price and divide it by the earnings per share (the profit) of the company. This PE ratio tells you how much overvalued or undervalued a company is. Let’s take a look at the PE values of AAPL and ZM. For AAPL, the PE ratio is 35.79. So this means that the stock is trading at 35x the profits. For ZM, it is a whopping 490!!! The stock price is 490 times the earnings! That’s crazy! So let’s see what’s normal. Here’s the PE ratio of the S&P 500 companies. Right now, it’s 29.24, so almost 30. Apple’s PE ratio is 35, so it’s close to the average of the S&P 500 companies. But AAPL is a tech stock, and we know that the NASDAQ is the “tech index.” So let’s take a look at the PE Ratio of the NASDAQ. It’s 26.52 right now. Wait, what??? I thought everybody was saying that tech stocks are overvalued??? Well, it seems they are in line with the S&P 500, and it’s also in line with its historic averages. So why is everybody saying that stocks are overvalued right now? And why did the market crash? Well, there’s a simple explanation. Let’s dive a little bit deeper into the NASDAQ. There are 100 companies in the NASDAQ Index, and here’s how they are weighted. As you can see, the Top 7 companies make 50% of the weight of the index. We already looked at Apple and know that their P/E ratio is at 35 right now, and that’s AFTER the correction. So it’s still higher than the average of 26.52 but not too crazy. Let’s take a look at the others PE Ratio: 2.) AMZN: 126. 3.) MSFT: 37 4.) FB: 33 5.) GOOGL: 34 6.) GOOG: 35 7.) TSLA: 907 So as you can see, these 7 companies currently account for 50% of the NASDAQ, and are all trading higher than the average, with AMZN and TSLA being crazily overvalued. And simply put, that’s why the market crashed. At some point, the big hedge fund guys realized, “Oh man, we have some crazy stocks here in our portfolio! They are overvalued!” And so the big guys are taking some profits off the table and SELLING these heavily overvalued companies. And if they “only” sell shares of these 7 companies, then it drags the whole Nasdaq down. So will the market continue to move lower? Earlier this year, the NASDAQ lost 30%. Can this happen again, or is over after this 10% drop? Well, we had this pandemic, and NOBODY knew how it would affect our economy. So the big guys did what they usually do when there’s uncertainty: SELL and sit on a pile of cash, like Warren Buffet. But you’re not earning any money on cash. At some point, you need to invest the money again in the market. And once we had a better idea of how the virus affected our economy, the big guys started buying again. So if we look at this “flash crash” in September 2020, here’s what happened: The big guys – a.k.a SMART MONEY – noticed that some of the stocks that they purchased went up too much, and they sold them to take profits. But they can’t sit on the cash for long. They need to earn money, so they invest it again after values are back to normal. And that’s what we are seeing today: It’s called “buying the dip.” Summary: Why Did The Markets Crash? You should now be familiar with both EPS (Earnings Per Share) and the PE Ratio (Price Per Earnings). And you know that the big guys – the smart money – they’re keeping a close eye on these numbers. If they get too high, then they SELL some stocks and realize a profit, and they buy companies with a lower PE ratio. And THAT is why the markets crashed for a few days – and why they are bouncing back right now.
TVC:NDQEducation
by rockwelltrading
Stock Market Crash Fall 2020Based On Video Recorded On Wednesday, September 2, 2020 At the time of writing this, the markets are at all-time-highs… but are we setting up for a Fall edition to the 2020 stock market crash? If you’ve followed me for any length of time you’ll know I’m not one for making bold market predictions, based on gut feelings. I take a systematic approach to trading. So let’s just start by looking at the facts: 1.) This November, we have the Presidential Election. This is and has always been a significant event for the markets. I’ve found a website (Isabelnet) that has charted what has happened over the last 23 elections. Has The Stock Market Crashed The Fall Before An Election? Let’s take a look at what historically happened in the 3 months leading up to the election. Over the last 23 elections, 14 of those times the markets have gone up and 9 times it went lower. The moves to the downside haven’t been what I would consider significant, with one exception: The 2008 Financial Crisis But because that was a unique circumstance, I would consider it a bit of an anomaly. Other than that, the losses are less than 3.5% and the gains are anywhere between 2.5 – 8%. So over the last 92 years, the markets have gone up 61% of the time. Based on this data alone, you could make the prediction that it’s very unlikely we will see a stock market crash this fall… at least before the elections. And there’s one REALLY simple reason for it: Trump wants to be re-elected. And right now he has a great story to tell: “Look at the markets. They are at all-time highs and I did that!” And look, I could care less what political affiliation you have, this is just my take on it. It seems that the stimulus packages as well as the Fed measures that they implemented seem to be working. So Trump would be stupid to “rock the boat” right now. Yes, we still have a conflict with China. But in reality, that’s ‘piddle – paddle’. It’s like 2 girls in a sandbox saying: “You’re mean!” – “No, you’re mean!” – “You’re ugly!” – “No, YOU are ugly!” And right now I don’t think that Trump will do anything that could potentially send the markets sharply lower, because THAT would likely decrease his chances of being re-elected. On the horizon, I don’t see any other major events that could potentially crash the markets. Looking at the economic reports, for the most part, everything is being reported better than expected. Some additional good news is that pretty much all companies in the S&P 500 have reported earnings for the past quarter. And 84% of the companies reported better than expected earnings. So all of this is positive news for the markets, and it seems that we are handling the pandemic well, at least economically. So what COULD send the markets lower right now? One thing: PROFIT TAKING. No market can go up forever! At some point, there will be some profit-taking and the markets will pull back. The key question that remains is: How Big Of A Drop Could The Markets See – Are We Talking Crash Or Pullback? So there are 2 tools that I like to use to get an idea of how much the markets could potentially drop: 1.) Fibonacci Retracements : Now I’m the first to admit I’m not an expert in Fibonacci, and there are probably much better ways to do it, but here’s how I do it. Grabbing the Fibonacci Retracement tool, I’m going to find the low from the Pandemic Crash and run from that low to the first high before a noteworthy pullback as you can see from the image below. Looking at it, you’ll see that from the low to high swing the SPX found support around .50% retracement, or a 50 percent retracement of that swing. Make sense? For me, this is just an easy way to give me an idea of where we might find support during a pullback. So let’s take a look at the most recent pullback. And we’ll run the tool from it to the current high, to give us an idea of where we could end up if we see some profit-taking: From what I can see, I would expect the S&P to find support around the 3500 or 3400 levels. 2.) Missed Pivot Points : The second tool that I like to use is one created by my friend Rob called the “Missed Pivot Points.” So if you’ve never heard of “Pivot Points” before, it’s the high + the low + the close, divided by 3. So what he likes to look at are Monthly and Weekly Missed Pivots Points. In TradingView they’re available as a free indicator. When we plot them you’ll see that they align right around the same area of the Fibonacci Retracements we just ran. So Are The Markets Going To Crash In The Next Three Months? Everything is possible, but based on my analysis, it’s not likely we’ll see a full-blown stock market crash this fall 2020. But as we’re all aware at this point, 2020 has been full of surprises. I do believe that we could see a correction to these levels I discussed (3400 or 3500), but based on the analysis that I’ve discussed, it’s more likely that we will keep drifting higher.
NASDAQ:TSLAEducation
by rockwelltrading
2
10 yrTreasuries look to be signaling that yesterday & today are in fact buy the dip we have risk on sentiment coming next couple weeks. If we check the weekly RSI 10 yr yields r very overbought, coincidentally so are all major indices RSI weekly indicators. Conclusion is we are in the final chapters of the bull market since March and another crash is imminent. But will likely be another opportunity to buy the best dip before another massive bull market over the next few years.
TVC:US10YLong
by Big_Mike716
scoWhat's up guys, just want to share my strategy with my followers. I am currently long ALGO (crypto) & XRP waiting only this weekend b4 I close off all open positions. I closed my SDOW not because I don't think it will continue to rise as I feel strongly that the DJIA is pretty fucked. But because I want to short WTI crude. I plan (if this works out) to close off algo & xrp in profits, then take my profits transfer those profits to fidelity and put a buy order in around $32 on the $SCO. Now if you seen my DXY chart u will see that the dollar index has little room to drop B4 it resumes the final parabolic dollar blow off top. I'm not sure if this will be 100% due to the fact that WTI crude storage is just about full and there's nowhere to store or if this will be a combination of COVID-19 issues plus the black swan I am suggesting that will strike oil markets. Either way dollar demand = risk off & no oil storage + relentless shale pumping = neg contango prices going forward. So my big bet will be to short Crude via SCO. I linked a bunch of my work for you guys to reference. Don't forget to follow me on twitter link in my bio. good luck everyone & I think the markets will be in big trouble sometime June 2020. (DXY chart linked below)
AMEX:SCOLong
by Big_Mike716
2
Bulls Don't Get Your Hopes UpRetail is plowing into USO, tech, and US stocks. Even with the "Fed Liquidity", the 1st quarter of 2020 was the largest QoQ contraction in credit conditions EVER. The fundamental economic data is putrid. The worst ever. and REMEMBER, corporate profits peaked in late 2018, which is also when the Russell 2000 entered a bear market. The SPX was saved from crashing by a Fed that slashed interest rates in 2019, but with this biggest global shock we have ever seen and with money supply velocity at ZERO, there's nothing that traditional monetary policy can do for the markets. Markets bounced off of hope and optimism given to them by Mnuchin. Don't trust the administration. Things are about to get UGLY UGLY
SP:SPXShort
by Ludwig_Von_Mises
20
The Great Depression (1M) v. Current Market (3M)If you've been following me here, on YouTube, on Facebook, or on Twitter, then you know that, for the past 1.5 years, I have been warning that the 2018-2020 trading range is likely distribution, using point and figure charts as well as volume and price action as evidence. I have also continually pointed out the fundamental similarities to 1987, 1999, and 2007. Over a year ago I stated that we could see price targeting $14,000-$15,000. At this time, it's looking much closer to $10,000-$12,000 at least. For those who say that can't happen, I wanted to show you a comparison between the Great Depression (1 month chart) on the left and the current market (3 month chart) on the right. Notice any similarities? Notice a LOT of similarities? None of this guarantees that the same, or even a similar, path will taken by the market, but it does provide information for you to consider. Anything can still happen. The government could come up with some new, exotic way to prop up the market. But, just in case...
DJ:DJI
by Chris_Inks
10
SPY / SPX short. Are we in corrective C wave? Or larger A wave?Some possibilities I'm preparing for: We finish wave 5 in the wave C down. Then we bounce from there into a wave 1 up. Or this whole down move is part of a larger A wave down, which means there's a lot more left to fall. I'm kind of thinking the latter, but time will tell. Either way, I'm expecting lots of volatile moves up and down, so I'm managing my positions very closely. Lots of risk but lots opportunity! Good luck everyone.
AMEX:SPYShort
by kidsupervillain
S&P 500 and Recession?Though it seems like we're currently in correction wave A and would like to stay neutral short to mid-term until confirmed wave 1 appears, the gap and bearish engulfing candle make it seem like the slide will continue earlier than expected within Q1 -- or maybe it will suddenly "recover" fast by next week, depends on the whales tbh, but lemme know your thoughts down the comments below. Anyway just sharing an interesting pattern in S&P 500 coinciding with the major downturns in the market and recessions in the past, and might interest those who want to "time" the markets. As mentioned in my trading blog, ceteris paribus, overall I'm bearish in the markets in the next decade or so considering the stagnant growth of world economies. The only thing that can push that up is if we're finally able to start mining in space and utilize AI technology while "smoothly" transitioning displaced human workers into more relevant roles. Guideline: SELL - divergence in RSI and chart on -61.8 fib or higher (-61.8 becomes new 0 fib) and RSI above 70 for sell - sell up to around 0 fib of prior period and RSI below 30 (then soft buy-soft sell) OR - sell up to near -61.8 of current period (if there is prior bearish period & fib) or -100 of current period (if bearish reversal) SOFT BUY - RSI below 30 - price below -38.2 fib of prior period - buy up to near -61.8 of current period SOFT SELL - 2nd RSI above 70 - price above -38.2 fib of current period (if prior fib is also bullish) or near -100 fib - sell up to near 0 fib of current period BUY - divergence in RSI and chart on 0 (-61.8 fib or higher of prior bullish period) and RSI below 30 for buy - buy up to around -100 fib of prior period and RSI above 70 (then soft sell-soft buyl) OR - buy up to near -61.8 of current period (if there is prior bullish period & fib) or -100 of current period (if bullish reversal) SOFT SELL - RSI above 70 - price below -38.2 fib of current period - sell up to near -61.8 of prior period SOFT BUY - 2nd RSI below 30 - price at 0 fib of current period - sell above -38.2 fib of current period Rules: 1. For reversals, plot fibonacci either from prior period -100 or -61.8 fib level (depending on where price is nearest) down to prior period 0 fibonacci level 2. If price continues to trend up or down, way past the -100 fibonacci level, plot that as new 0 fibonacci level and add a hype icon (champagne glass or caution) 3. RSI is set at 10-70-30 on the weekly chart only
SP:SPX
by aiza_belle