Bear Markets

[halfwheel]

Id like to know how a Bear Market differs from the recent correction that we have seen. Do share prices drop down rapidly or is it more of a gradual decline over 12 months. How much do they normally fall? How long do they normally last and what is the best thing to do when it arrives. (How will I know when it has arrived?)


Thanks

Halfwheel:confused:

[>Apocalypto<]

Id like to know how a Bear Market differs from the recent correction that we have seen. Do share prices drop down rapidly or is it more of a gradual decline over 12 months. How much do they normally fall? How long do they normally last and what is the best thing to do when it arrives. (How will I know when it has arrived?)


Thanks

Halfwheel:confused:

Half wheel this is a bear market in the US$ its a weekly chart.

see chart

[explod]

Id like to know how a Bear Market differs from the recent correction that we have seen. Do share prices drop down rapidly or is it more of a gradual decline over 12 months. How much do they normally fall? How long do they normally last and what is the best thing to do when it arrives. (How will I know when it has arrived?)


Thanks

Halfwheel:confused:

The bear Market ahead of the great depression began about 1927 and lasted for more than six years. Like a bull market it is like a saw blade, ups and down all the way. Roughly revesals are a change of direction out of the trend channel by more than 5%.

The techno's should be able to give more a more finite idea

[Flying Fish]

So rapid swings either way. Maybe we are safe for another year, or maybe all that old style stuff is history?

[>Apocalypto<]

So rapid swings either way. Maybe we are safe for another year, or maybe all that old style stuff is history?

Look at the chart fish that is a classic bear market. They don't all just drop in a massive crash!

There is a initial crash followed by counter rallies that fail.

[Flying Fish]

Look at the chart fish that is a classic bear market. They don't all just drop in a massive crash!

There is a initial crash followed by counter rallies that fail.

Ok so whats the best plan of evacuation? cash sucks, gold is well inliquid? property?

[Flying Fish]

Actually perhaps I'll give away the get rich easy scenario, work hard and get good at something and then see how it plays :-)

[>Apocalypto<]

Ok so whats the best plan of evacuation? cash sucks, gold is well inliquid? property?

that is up to the individual investor, I will be selling rallies ( any one thinking of short selling or selling cfd's short please do your home work before attempting it)

Fish take a real good look at the xao chart its on a uptrend from the 80'S

so yes it may go south then accumulate for a period of up to 5 years, or less or more but its on a uptrend that's the good news so more likley then not it will continue.

see chart XAO

[>Apocalypto<]

Actually perhaps I'll give away the get rich easy scenario, work hard and get good at something and then see how it plays :-)

take your time and don't rush FF,

the markets will always be here tomorrow, If you treat the markets as a get rich quick scheme then they will sought u out in due time believe me!

Patience and continual study are keys to success.............

[halfwheel]

Ok what about other bear markets. Is it a case of gradual 50 point drops over a period of 12 months or is it a freefall or what?

[Flying Fish]

take your time and don't rush FF,

the markets will always be here tomorrow, If you treat the markets as a get rich quick scheme then they will sought u out in due time believe me!

Patience and continual study are keys to success.............

Good advice. thx :-)

[explod]

Ok so whats the best plan of evacuation? cash sucks, gold is well inliquid? property?

Cant' understand why you say that, I have been buying and selling gold and silver with A. J. MATTHEY for years

[wayneL]

Ok what about other bear markets. Is it a case of gradual 50 point drops over a period of 12 months or is it a freefall or what?
There are all sorts of different bears. Have a look at the Japanese stock market from 1989-90.

It lost over 80% of its value over 13 years. Now that's a bear! LOL

[explod]

Ok what about other bear markets. Is it a case of gradual 50 point drops over a period of 12 months or is it a freefall or what?

No rule of thumb, but down as with jumping off a cliff, is usually more rapid than the climb. Look at Bendigo Gold, big sudden drops in a couple of stages. Remember Aristocrat's fall a few years ago big time to .95 cents and then the gradual climb to, without checking 12 or 13 dollars now.

An old saying which I read on the forum in the last week, dont try to catch a falling knife (or was it star) I suppose the lesson is when you know things are bad it is time to stand aside or if you can short it.

And..... risk takers get burnt, so for me when in doubt, get out

[Flying Fish]

No rule of thumb, but down as with jumping off a cliff, is usually more rapid than the climb. Look at Bendigo Gold, big sudden drops in a couple of stages. Remember Aristocrat's fall a few years ago big time to .95 cents and then the gradual climb to, without checking 12 or 13 dollars now.

An old saying which I read on the forum in the last week, dont try to catch a falling knife (or was it star) I suppose the lesson is when you know things are bad it is time to stand aside or if you can short it.

And..... risk takers get burnt, so for me when in doubt, get out

same deal amp,cml and ann.

[halfwheel]

OK so they fall faster than they rise. Do they fall in 200 -300pt drops like the current correction but just keep going? This correction didnt last long to drop 12%. How long does a bear market last? What about the last 2 Bears, what were they like? :rolleyes:

[explod]

OK so they fall faster than they rise. Do they fall in 200 -300pt drops like the current correction but just keep going? This correction didnt last long to drop 12%. How long does a bear market last? What about the last 2 Bears, what were they like? :rolleyes:

I think you are getting some good answers, if you are still in doubt then you should think about not trading till you get a better understanding.

In recent drops of the Dow we have seen, 350point a number of 200s but when big problems strikes it could go 1000 in a day. No rule. Just understand that the financial world at the moment is a risky place and wild girations (volatility) are also another characteristic of change coming.

[>Apocalypto<]

OK so they fall faster than they rise. Do they fall in 200 -300pt drops like the current correction but just keep going? This correction didnt last long to drop 12%. How long does a bear market last? What about the last 2 Bears, what were they like? :rolleyes:

HW,

the message here is that each bear is differnt from each other that's the main point your missing.

some will lose 80% in 13 years like Japan or they may lose 50% in a day or 2 like the dow did in 87.

or it may take 3 months 30% then 6 months another 60% its up to the market!

just keep your eyes open and read what the charts are telling u!

good trading

[halfwheel]

OK I get the picture. So what are the warning signs. That graph is looking way steeper since 2003 than over the previous years

[wavepicker]

OK I get the picture. So what are the warning signs. That graph is looking way steeper since 2003 than over the previous years


Just about every bull market in history has been different in some way to other bull markets. The same can be said for bear markets. However, the bigger the party then usually the bigger the hangover.

Suffice to say that the warning signs were there for all them way before the bubbles burst. What sort of warning signs??

-Extreme Optimism(95% of punters convinced trend will continue)
-Complacency
-This time it's different
-Market Thins out coming into a top
-Price Patterns/Cycle tops

Now none of these can tell you the exact top( unless all the patterns are falling in place at the right time and look really convincing which is really rare), but they give a fair idea.

ATM, there is a whole new breed of trader that has no idea of what happened back in 1987 and there are so many derivatives to trade the markets that no one really knows what these things are actually worth. One thing I am relatively sure of is that there is something looming on the horizon that is going to scare the pants off nearly all investors, including me!!

Cheers

[halfwheel]

Just about every bull market in history has been different in some way to other bull markets. The same can be said for bear markets. However, the bigger the party then usually the bigger the hangover.

Suffice to say that the warning signs were there for all them way before the bubbles burst. What sort of warning signs??

-Extreme Optimism(95% of punters convinced trend will continue)
-Complacency
-This time it's different
-Market Thins out coming into a top
-Price Patterns/Cycle tops

Now none of these can tell you the exact top( unless all the patterns are falling in place at the right time and look really convincing which is really rare), but they give a fair idea.

ATM, there is a whole new breed of trader that has no idea of what happened back in 1987 and there are so many derivatives to trade the markets that no one really knows what these things are actually worth. One thing I am relatively sure of is that there is something looming on the horizon that is going to scare the pants off nearly all investors, including me!!

Cheers

Dont bull markets last longer than this? Isnt the overall economy strong and P/E on shares relatively low

[wavepicker]

Dont bull markets last longer than this? Isnt the overall economy strong and P/E on shares relatively low

There are various degrees of trend at play in the market. Essentially we have been in a bull market since the early 1980's??? Although this current leg started in March 2003.

As for the economy being strong, there is no doubt about that it . But does that guarrantee the market will stay bullish?? Absolutely not. If anything, the movements in the market precede what the economy does. For instance, take the Crash of 29, it preceded the Great Depression and the crash of the Nikkei in 1990, it preceded a deflationary depression in Japan.

Cheers