Some analysts are predicting a short term bounce, do you think this will happen?
There is certainly a lot of negativity in the market right now. Almost every indices is showing a downward penetration of the bullish wedge formation. Friday was expirations day and much of the put action that expired was not replaced leaving very little protection in place for the markets. These are bad signs, yet some analysts are predicting a short term bounce. What is your opinion on the market today and why?
Best Answer
3963 points
MNSL answered one year ago …
I think there will be bounce soon. This year will be similar to last year. There will be up and down. So we must intelligent enough to pick the correct type of investment. There were similar situations in the stock markets through out the world last year. Many expected even crash last year. But market rebounded .We must not forget in every situation there is an opportunity. You can see how even now newly emerging investors and companies are investing not only in developed countries but also in developing poor countries. Some intelligent investors know value for money. We are in the final stage of bull market. It can last till 2009. But in the meantime we have to be vigilant and we have to do research about future market trends to avoid unnecessary problems such as housing bubble. When everybody is talking something we must get out of the market. In other words when market become too hot and P/E rate expand beyond the sustainable level then it is time to leave the market. Still there are some support levels in the market
Finally I see present market condition is a temporary event. There will be bounce back in the market soon. Still there is plenty of money in the system. I also see there is oversold situation in the market. You can see money not only from developed countries but also from emerging countries, sovereign wealth funds, emerging investors and private equity funds to mention few. Some are suddenly getting interest in investing in US Stock market in addition to their own market. Some emerging countries already have raised capital from US market and still they want to see buoyant capital market to raise capital for their companies.
If you just analyze fast bull markets this great bull market is quite different. This time all type of assets classes including commodities have appreciated. So money has created in every where including commodity producing countries. Now there are new investors they want to shift their investment as well.
Answers
2183 points
ChaosNantuko answered one year ago …
I think we're in for a bit of a short-term rally when it hits 130. Might go back up to 135 at that point. I'm not expecting anything big though
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1130 points
sundarkambam answered one year ago …
Short term bounce is very much likely because :
There is a lot of bearish sentiment around.
Companies are also sitting with with cash positions
Plus there is a 5 to 10% drop in major indexes.
These are sure to attract bargain hunters .
508 points
John answered one year ago …
I dont believe so! We have been having rallys here and there, like the one we had this week. But we are coming to the end of this bear market. Most sectors being hit are undervalued. everyone knows we are in a down market, so over the next 4-6 months we will begin to emerge form the bear market. We will begin to see more sectors showing a bull signal vs. most now showing bear status today.
I think we are on track to start moving out of this bear market and are beginning to bottom.
If so get ready for a bull charge. A short term bounce might occur but I think we shoud begin looking for the market to move forward as a whole.
