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Old 01-04-2018, 12:33 PM   #1
JustRalph
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How long until the market corrects?

I can’t imagine this market continuing like this.......

Trumps Tax cuts are going to help it........BUT

Eventually it has to fall back......predictions?

I say within 12-24 months.......October 2019 or shortly thereafter

I know almost nothing about the stock market, but this cannot go on forever........
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Old 01-04-2018, 02:10 PM   #2
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every market pulls back at some point and bull markets become bear markets. but to time them is impossible!
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Old 01-04-2018, 02:38 PM   #3
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I'd declare the result official at this point and all bets and calls for a market correction losers.

Timing is everything, if you bet on the downside you lost, and if you waited to buy, you lost.
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Old 01-04-2018, 03:11 PM   #4
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Quote:
Originally Posted by AltonKelsey View Post
I'd declare the result official at this point and all bets and calls for a market correction losers.

Timing is everything, if you bet on the downside you lost, and if you waited to buy, you lost.
9 years of ďthis is going to end badlyĒ.

And it will. Probably as soon as the last bear finally throws in the towel and decides they canít lose in stocks.

Last year around this time, the market broke 20,000 and I made the brilliant call that it would see 19,000 before it saw 21,000. Went to a 30% cash position in anticipation of some bargains.

All that money got bled back in at higher prices over the next 4 months.

Iíve decided that Iím better off getting punched in the face than trying to time the market.
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Old 01-04-2018, 03:18 PM   #5
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Markets sell off in order to shake weak hands.

Apparently , that scam stopped working, so the 'boys' decided that straight up was a better ploy.

Congrats to them
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Old 01-04-2018, 04:44 PM   #6
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I'll be the first to admit we've been experiencing what appears to be an extended Goldilocks period...

But, if I recall correctly, wasn't there a rotation out of tech last fall?

Consider some historical data:

Priceline (PCLN)
2067.99 high on 08-08-2017
1630.56 low on 11-08-2017
(-21.15% off the high)

NVIDIA (NVDA)
217.36 high on 11-27-2017
180.58 low on 12-05-2017
(-16.92% off the high)

Arista Networks (ANET)
245.65 high on 11-21-2017
206.86 low on 12-05-2017
(-15.79% off the high)

Netflix (NFLX)
202.48 high on 11-06-2017
178.38 low on 12-04-2017
(-11.90% off the high)

The point I'm trying to make?

Haven't at least some investors been faced with a "correction" during this market? (Imo, more than one.)


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Old 01-04-2018, 04:48 PM   #7
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I worked on the floor of the NYSE in '74. I started towards the end of the bear market which saw the Dow it 577! My dad was a broker working out of an office in Flushing, NY.

I eventually got a job as an order clerk, but my first job, which only lasted a month or so, was as a page, where you walk the floor taking orders back and forth to different specialists. I don't know if that's the way they do it now, but back then, the order clerk got the order over the phone and handed it to a broker, who then either delivered it to the Specialist (Specialists hold the book on a stock and set the buy and sell prices), or handed it off to a page who would deliver it to the Specialist.

I thought that you could get a much better feel for the market on the floor than in an office. I remember telling my Dad that the sentiment among the brokers on the floor was that the end of the bear market was imminent. I would hear them saying things like, "There are so may bargains....Next year is going to be a good one."

Sure enough, the market bottomed out in December and started to go up, and it went up 48% in the next five months. And the big money was loaded up for it, believe me. The rich got richer, as usual.

Predicting the end of a bull market is tougher. You have to watch for wild speculation. When the dot com bubble burst, for instance, biotech companies had recently emerged and they were the hot thing, and stock prices on some of the biotech were jumping 60 points in a day, and plummeting just as fast. People who weren't normally in the market were suddenly trading. My dad told me, "there's wild speculation, the bull market is going to end soon."

Same thing happened in the real estate bubble, people were "flipping houses" like crazy towards the end. When it looks like easy money, it's about to collapse.

I don't see wild speculation right now, except for in some of the crypto currencies, which could be a warning sign. But the market is different now because so much of the corporate profits come from overseas, it makes it harder to get a feel for the market. The key is, how much of the Trump rally was in anticipation of the tax relief and the cutting of regulations?

Still, corporate profits dictate the market and profits are going to be good this year.

Last edited by pandy; 01-04-2018 at 04:53 PM.
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Old 01-04-2018, 05:37 PM   #8
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The markets survived 8 years of the Obama adminstration with record breaking growth. They have also survived over a decade of the economy bumping along the bottom with minuscule growth. I would say that some very smart people have a very good read on how the markets work. Unfortunately, I got out in 2010.
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Old 01-04-2018, 05:54 PM   #9
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I'm with Lamby, and others here, who think the market is impossible to predict with a high degree accuracy, which is precisely why I'm a passive investor. As such, I don't look a gift horse in the mouth. I'll be taking some profits soon to resist getting greedy by trying to outguess the market.
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Old 01-04-2018, 05:57 PM   #10
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I think we've got two more good years before the "correction."
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Old 01-04-2018, 08:01 PM   #11
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From what I've read so far no one has offered a truly legitimate reason why the market will correct.

Rising stock prices do not stop rising simply because of ... rising stock prices ...

Markets don't correct solely because the markets have been going up ...

(Reversion to the mean is the silliest and most disproved 'truism' ever uttered in the discussion of the stock market.)

The major US companies that compose the Dow 30, S & P 500, etc., all received a 10-15 per cent boost in earnings per share simply by the passing of Trump's Tax Bill that lowered corporate tax rates from 35-40 per cent down to 21 per cent.

This bump in earnings is unencumbered and the financial different is all profit and lands straight on the bottom line. And this is before a single new and additional product and service is sold!

There are still dozens of well-known companies still available to buy at less than 10 times Free Cash Flow and a few dozen more selling at 15 times FCF and less.

Absolute steals and these companies all have 30-50 (and longer) year operating histories of success.
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Old 01-04-2018, 08:22 PM   #12
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No question the tax break was Yuge.

And so much for the theory that folks were waiting to sell in the new tax year.

About 90% of the theories you see tossed around are wrong, proving that a coin flip would serve you better
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Old 01-04-2018, 10:52 PM   #13
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No question the tax break was Yuge.

And so much for the theory that folks were waiting to sell in the new tax year.

About 90% of the theories you see tossed around are wrong, proving that a coin flip would serve you better
Yes I was the one that thought there would be some January selling and am very surprised the 2018 early rally has been this strong.

But it's still just two trading days into the New Year ... so there's time. If there is a sell-off or not in January or anytime, it won't matter for the market will have another great year, up another 20-30 per cent at least, as I see it.

Good luck.
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Old 01-05-2018, 07:21 AM   #14
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28,000 Dow?

https://www.cnbc.com/2018/01/04/ralp...calm-down.html
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Old 01-05-2018, 10:21 PM   #15
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Itís hard to make an argument that the economy wasnít already doing well or that corporate tax cuts are somehow going to be a short term negative.

Marketís are predictive mechanisms and I probably wonít see the next recession coming before the market does. The yield curve has flattened but hasnít inverted and if the tax cuts unsupported by spending cuts doesnít send the long end higher, nothing will.

Inversion is an incontrovertible signal of a recession that I donít think youíll see any sign of in 2018. The Fed is more likely to be playing catch up with this economy than inhibiting it in any fashion. Which means there should be clear sailing through at least the 1st half.

I will say that the higher this market goes without any significant correction, the harder the ultimate landing is going to be. But itíll probably still punch me in the face before I know itís there.
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