Dow Dropping Fast, dont buy the China Stock

The Dow was down like 200 pts right after opening, but some good housing economic data came out and it recovered most of its losses, ending down just 34.

Originally posted by djohnsto77
The Dow was down like 200 pts right after opening, but some good housing economic data came out and it recovered most of its losses, ending down just 34.

think we can see a drop tomorrow, but it depends how Asian markets react to what happened in Europe and the States.

China hiccups...the world spills it's Starbucks wake up call.

I think China's intention was to cool off the overheated, and fundamentally unsupported surge in the Shanghai and Shenzhen exchanges...I'm not sure that even they expected this type of global response. Will they do it again if they feel a need to? It's looking like one overvalued market...reacting to another.

Then there's the Carry Trade. If panic spreads and the Yen continues to gain, I expect the affect on the US market will be more severe...Yen 109 vs the Dollar =

I imagine a contributing factor here at home is the result of margin trading...reported to be at record highs. Some will be forced to sell everything, including precious metals, in order to cover their equities accounts.

Gold has strong support at $658...should begin to attract 'safe haven' investment as the Dollar continues to stall, wobble, and slide, and as paper assets continue to lose their attractiveness. Given the condition of the US housing market, and the sub-prime mortgage fiasco it's doubtful we'll see rate hikes soon...Dollar negative & Gold positive.

Peace &
Good Fortune
OBE1

Originally posted by djohnsto77
The Dow was down like 200 pts right after opening, but some good housing economic data came out and it recovered most of its losses, ending down just 34.

I'm wondering what happens when more people begin to realize that today's manufacturing data...spun as good...is really just mediocre. Anyway, as you cited djohnsto77, it appears it was good enough to rally the day.

Peace &
Good Fortune
OBE1

My thinking is the U.S. market was due for a correction. Alan Greenspan's comment that we may be headed for a recession plus the precipitous drop in China (which needed a correction even more than we did) just precipitated the drop.

There doesn't seem to be, as of yet, a really serious problem with U.S. economy. Although the averages may fall more over the coming days, I think a few months out, this will be looked upon as a buying opportunity (as far as U.S. stocks go).

Originally posted by djohnsto77
My thinking is the U.S. market was due for a correction. Alan Greenspan's comment that we may be headed for a recession plus the precipitous drop in China (which needed a correction even more than we did) just precipitated the drop.

as some stockbroker said, the DOW Jones has not lost 10% in about 4 -5 years. its due for one. as the old saying goes,

what goes up must come down.

we have to remember that many feel that the markets have grown too quick, nearly all the major international markets have broken records so its this period of decline is needed. every boom has to come to an end.

it could be worse it the markets got even higher and than dipped, it would result in a crash. which none of us want.

about mid-march is when everything will go back to normal.

just listening to Bloomberg about the Chinese stocks..

the valuation is apparently too high, 38% is the figure being quoted. many feel another major Chinese sell off tomorrow. It wiped out all its gains today. plus the main Chinese stock market grew by 200% in a year...it needs to take a dip again many feel.

i hope i have just misread that, but i swear the Chinese future is down by 8%!!

im gonna check again, i think i have probably misread it

Originally posted by djohnsto77
My thinking is the U.S. market was due for a correction. Alan Greenspan's comment that we may be headed for a recession plus the precipitous drop in China (which needed a correction even more than we did) just precipitated the drop.

Ahso djs...and Greenspan predicting an event that he helped engineer....How clairvoiant of him!

Peace &
Good Fortune
OBE1

Bloomberg are stating that Chinese stocks have fallen again, they have dubbed this to be a potential "black friday"

[edit on 1-3-2007 by infinite]

I hope you all are in the practice of hedging your investments, because I wouldn't trust the current situation.

I know alot of people who seem to make the mistake of selling in the first sign of danger, essentially they allways sell low, and end up with alot less than they could have walked away with.

See? This is why I stick mostly to forex nowadays, lol.

Anyhow, it's the panickers that could potentially turn this hickup into something very bad. I just hope the people buying at low points outweigh the people cutting their losses and running, or the index is destined to drop further.


Speaking of forex, the US isn't doing very well on that front either... the GBP and EUR seem to be holding their own in retrospect, so I'm holding onto them as they climb against the CHF and USD today, which only started about midday today... should be interesting. It's a good thing forex is done in pairs, otherwise I wouldn't be able to make a profit off of this economic hiccup.

[edit on 1-3-2007 by johnsky]

Originally posted by johnsky
I hope you all are in the practice of hedging your investments, because I wouldn't trust the current situation.

Excellent advice johnsky.

What might 'they' do to ameliorate the situation?...Probably the only thing they can do...start printing, the equivalent of throwing jet fuel on a fire.

Gold's already doing battle at $658 tonight...things may get ugly for awhile.

Peace &
Good Fortune
OBE1

Thanks OBE1, I want nothing other than the best for my fellow ATS members.

Outside of this, before the Forex Market closed tonight, It seems the US dollar may be leveling out over the next week.

Granted they took some horrible hits this week, which worked to my advantage of course. Especially in the USD/JPY pair. 450 dollar profit for me! Woot!

But next week I can see things getting better for the US. If the leveling out was any indication today.

I don’t know too much about all this stuff, but I do know that I am glad I bought most of my gold 5 years ago around $300 an oz.

At this point in the game, I don’t think there is any safe buy except guns and solar panels!

Originally posted by cavscout
I don’t know too much about all this stuff, but I do know that I am glad I bought most of my gold 5 years ago around $300 an oz.

At this point in the game, I don’t think there is any safe buy except guns and solar panels!

If you started accumulating five years ago cavscout...sounds like you know all you need to know.

Best of luck & don't forget the Claymore's!

Peace &
Good Fortune
OBE1

I just heard on FOX that Asian markets are tumbling again in Monday trading.

Looks like this isn't over quite yet.

Originally posted by djohnsto77
I just heard on FOX that Asian markets are tumbling again in Monday trading.

Looks like this isn't over quite yet.

Peek if you dare: /3xr343

Major Asian Indices taking another drubbing today. Europe should be interesting. If $640 Gold breaks down ...next fib support - $620.

Peace &
Good Fortune
OBE1

^N225 Nikkei 225 16,642.25 2:00AM ET Down 575.68 (3.34%)

^HSI Hang Seng 18,664.88 4:59AM ET Down 777.13 (4.00%)

It just keeps dropping.

I hope that this isn't the economic implosion online economists were talking about for the past years.

Originally posted by Order Out Of Chaos

Originally posted by infinite

Originally posted by Order Out Of Chaos
.......Dow jones dropping fast.....

Irans future has been determined by the powers that be.And the people in the know know an excuse to execute those plans mean another fake terror attack.

[edit on 27-2-2007 by Order Out Of Chaos]

want to prove it?

come back here at the end of April.

Would YOU care to comment on the 'situation' now??? or are you still looking for 'proof'?

Open letter to the US Treasury Secretary

"So on July 25, 2006, my lawyer drafted a request under Section 552 of the Federal Code called the Freedom of Information Act asking for documents generated by the President's Working Group on Financial Markets.

Around here we call it the Plunge Protection Team.

That request was ignored....

Full text: /2wjvwx


Mr. Paulson, where were you on Feb. 28th 2007 ?...and more importantly...just what were you up to?


Peace &
Good Fortune
OBE1