Posts tagged as:

Volatility

Eight Year Bull Market Wiped Out in Three Months

by Gabriel Andre on October 27, 2008

Since the resurgence of the credit crisis a few months ago, both stocks and commodities prices have been plunging. But the FX market is probably the most impacted as the volatility has soared dramatically to produce unprecedented sharp moves on several currency pairs of the G10 universe.

In our last update on the AUD/JPY on September 30, the pair was still trading around 83.50. Less than one month later, it is now trading around 57.25 therefore 31% lower.

[click to continue...]

Beware the Bear Market Rally

by Gabriel Andre on October 17, 2008

This has been a tough week on the markets. One day is white, the next day is black. The pause in the bearish market has been very short then. Monday and Tuesday have been bullish sessions thanks to the governments’ guarantees around almost all over the world. Yesterday the S&P/ASX 200 fall back by 6.67% to 4,013.40 points.

As we were mentioning in our last update (MM of October 1st), the bears still drive the market and will probably lead it to lower levels.

As the retracement levels (after 4 years and a half of continuous rise between March 2003 and November 2007) considered as intermediary supports have all been cleared one after the other, and the next support is 500 points below the current level. It’s another 12.5% fall away. This objective, at 3,500 points, is an old previous high level which acted as a resistance in 2001, 2002 and 2004 (points A, B, C and D on the weekly chart). Once cleared, it became a new low (point E) and was an impulse point for a new rally phase in the second half of 2004.


Click To Enlarge

[click to continue...]

Money Morning Uncertainty Index

by Kris Sayce on October 17, 2008

Money Morning Uncertainty Index

We almost don’t know what to expect from today’s market. This time last week the bottom seemed to be falling out of it. Today a strong lead from Wall Street could help to push it higher. But it’s all ‘ifs’ and ‘buts,’ the reality is we don’t know.

It really comes down to the willingness of investors to hold open positions over the weekend. So far, as we watch the market opening almost everything is turning green. But we still have that nagging unease. The ‘V’ word is still evident.

We know that we are on the verge of overusing it, but volatility is still a major issue. It’s all very well for us to print a chart of the VIX index, or a table showing how the market has swung, but what does it mean?

[click to continue...]

Value & Volatility in the Australian Market

by Kris Sayce on October 14, 2008

Value & Volatility in the Australian Market

What does this mean for investors? Well, we will go into more detail in a special edition weekly update to our Australian Small Cap Investigator subscribers this afternoon, but in the meantime we can offer this.

There are opportunities in this market. Not all of them in the obvious places. It is important to remember that the market is very volatile. Last week the CBOE Volatility Index (VIX) hit an all-time high of 70. So what? For the previous six months it was ranging between 20 and 30 and even that was considered to be a volatile period.

[click to continue...]