• Christopher Hall

Buying into the Market Fall


Markets have fallen the fastest in history from their fresh highs in late February. Gary Glover of Novus Capital looks at the potential of a three-wave or five-wave pull-back and how to trade those swings.

Shares and charts Glover looks at this week are QANTAS (QAN) and Blackmores (BKL)

[00:00:00] Capital preservation is key in these markets, and the man making the most of the volatility is Gary Glover from Novus Capital. Good morning, Gary. How are you? I'm good, Chris. [00:00:08][8.8]

[00:00:11] Very volatile, but. So quickly, look at the portfolio. [00:00:15][4.2]

[00:00:16] You've picked up a few positions. You've increased your positions. You've come from sort of low double digits, low teens, sometimes 20 percent vested. How invested are you now or as is a report somewhere in your last two days? [00:00:29][12.7]

[00:00:30] If so, yesterday I was up to around forty three percent. And as of today, I'm getting closer to around 80. So it issues in a sort of passive panic sort of falls to sort of get this crop up in Boston shares. And so Tim didn't get any any shots I'd done there, missed missed that opportunity. But but I'll sit to patiently wait for the stocks to come off. It's a pretty solid market, but 16 days, 13 trading days, our off 25 percent on the exchange. So that's that's an almost unheard of. [00:01:06][35.6]

[00:01:06] There is a very different indeed. So we'll have a good chance to helping you determine when and when you will and won't buy. Yeah. Jones you've highlighted on the left hand slots and previews down market Sofaer markets. And then on the right hand side, you've got two boxes, one smaller, one larger. What do those two boxes in the right hand side? What are they for? Yeah. [00:01:29][23.0]

[00:01:29] So just looking at looking into the day, this group, we've had a pretty amazing run here, what, 11 year bull market, one of the strongest rally of all time here. So we've got to get that to be realistically expect something half decent on the pullback. Once we get a correction in place, we think the top said, which I think is the same. I think obviously the crowd is probably tipped over a bit more than a bit far than everyone was probably hoping for. But there's always going to come to mind. I just think this is just a speeding up the process there. But the question is what? What should we be expecting from here? You know, we're looking at something like a mild pullback, somewhere around 33 percent from its highs. Or should we be worried that we might have a GSA, so start something a bit nastier? I think the answer is probably there's probably somewhere between here. So one. But they do take a bit of time. This one's been pretty dramatic pretty fast. So, so far. So I do expect to see at least a three wave or a five life sort of sort of setup. [00:02:35][65.6]

[00:02:37] But yeah, the fact that we're already off, what, 20 percent plus, we're pretty pretty short period of time. So I think we're not turning back a bit deeper here, but it should shouldn't do or move. I think it'll it'll it should at least sort of play out at least through lifeform. In my opinion. [00:02:57][20.3]

[00:02:58] It's possibly the most likely three wave on the Dow Jones habit, the S&P 500. You've got a different charity or weekly chart and you've got a large red box highlighted. What's that red box telling us about today? [00:03:09][10.7]

[00:03:10] It's just look, I just tried to find. I mean, it's I know once it's all we know, the eighty-seven had 20 percent down on Monday and then spent some big moves one day. But we've never had a move off the top like this. And so far. So we're literally with 25 percent, your market in 20 percent plus in the US market within 12, 13 trading days off off the top. So it only takes a while. In the 87 crash thing that took 60 days to play out the whole whole movie. This this is just come off really, really fast. It's also trying to find a market where we've had a really lightening sort of fall. Yes, I noticed 2010, which was obviously this probably coming post GSA, many concerns. But that market really come off the hard pretty quickly and had a few, you know, V-shaped sort of lows and then come back, retest or lower than a rally again and then another retest and then a sharp rally. So pretty volatile, period. But that might be, you know, the fact that we've had such a sudden move down really quickly here and I snap back here. This might be the type of thing we might see here. So we might see something like this. We'll sort of see a few decent bounces here. But then we're going to come back and retest the low here or maybe get slightly deeper each time. So it's going to be pretty volatile, but it should be some opportunities as well. So that might just be an indication, might be sort of something which we might see something like that obviously a bit larger, but it won't be that sort of stall of move here. [00:04:39][89.1]

[00:04:40] And if we move that over to the Australian market, the ASX 200. So you've got a charity with the lowest long consistent trend in place and then a red dot down the right hand side. What's that? [00:04:52][11.6]

[00:04:53] Yeah. So, look, I think we've sort of been harping on for months here where we think we'll see sort of something in that. You know, it's sort of 30, 35 percent sort of category, at least around that sort of range. So if we look at sort of the our market sort of go back and look at Weekly's monthly sums. [00:05:13][19.4]

[00:05:13] So some are always sort of felt somewhere between five and five four. Might be the might be the levels to watch out for. That would be a pretty decent sort of pullback. So. So, yes, 5000 is 50 percent of the range. I think the 4 is another sort of fib and they are like thirty seven point eight of the old range. And so it's just a few levels around there to watch. But yeah, we've had I say we paid, what, 54, 50 $50s today. So hit one of those sort of on those ranges there. But yeah. Know we'll just ultra l think you know, the fact that we've sort of come back to what, five, four, five, five here in that first leg down, that's a pretty deep move here. So I think we'll see some sort of bounce here. But, you know, now I'm starting to think maybe that five thousand is possible, whereas before I thought maybe some of the 25 and fallen depending on how how negative we get. But but yeah. I think. Yes. I mean, I guess five 4 is probably the first level. I think we're pretty much there, huh. So yes. So maybe we'll see a bit of a bouncy, happy life and then we'll come back and retest quality. I mean, if we look at l0 yes. We took about a 10 year cycle side for look at 2010, 2019. But given the 60 year cycle or all of our pretty decent life, it may all come back and tell him to pivot there. [00:06:40][86.3]

[00:06:40] So just put a strong of strong sort of month for a low in the zero. Yes, I know. We've got a little bit left to send. Hey, what's going on the market? But, you know, normally you'd see at least a three way correction there. So it looks you know, I still think that's a possibility here. So maybe maybe we'll clean up around five. Come, come, come. Sort of a middle of my assignment, but I think we still see a theme. [00:07:05][25.6]

[00:07:06] Them, us. I think be a hope you'll see a decent bouncier just 2000 points down in a pretty decent move so that it feels a little exhausted to me. [00:07:18][12.6]

[00:07:20] And move from the Elzie market with those targets. You look at something that has been really hit hard. I mean, look at the travel space. The airlines, Taunacy has been hit very hard. You've got a Sharkie, you've got three tops overlapping each other and then you get a target. Anybody. Those two are related tops. [00:07:38][17.9]

[00:07:38] The target is time on my conscious. [00:07:40][2.4]

[00:07:41] Do not do not, do not buy any travel aviation. So the stock sale I'm expecting I think this forest is going to hang around for a while. Long, long term. Typically, maybe maybe some 12-mile, maybe a month. So I think these stocks are going to see a lot more dance eyebrows looking through weeklies, monthlies for somebody, stocks. I thought, well, say some really big, bold potential targets here sort of people might consider unfavorable another. But, you know, I reckon that Qantas can come back to that 260, 270 level. [00:08:12][30.9]

[00:08:13] So I would be trying to we'll be trying to pick a low end. I think that's a big bearish pattern on the on a weekly monthly set up there. And yes, we're going to see a pretty, pretty decent corrections beginning to come back to where this last drive started, which was around that 2 270 mark. [00:08:29][15.8]

[00:08:30] And then if you also look at another one that has come down, so it's it's up the stairs, but there's definitely some elevators and there was some very rapid drops in the blackmore's chart. How's that looking? There you go. FBA, which is one of your favorites, a false break. [00:08:42][12.6]

[00:08:43] Is it a buying time yet or how does that you're just looking for sort of, you know, looking for sort of sectors, which I think are going to going to hold up here. So, you know, this is sort of serious sort of what's happening in the world here. So just going to be a that's why I'm sort of him, you know. [00:08:59][16.0]

[00:09:00] But if you sort of funeral operators or for a few telcos or feel they're pretty safe here. Just don't think the bottom in space, you many you've got run on all these different products. I think at some point, you know, this is one that we should be. You know, people should be flocking to. I think you're already seeing a bit of a pretty strong sales in this area. So a pretty decent down downward move here. It's probably got to that low a little faster than I'd like to say. I'd like to sort of see a false price at the low with a bit more time. You stop at some reasonable volume down there and it's probably the most interesting thing. So, you know, I think any reversal here looks pretty interesting. So this this is one, you know, there's like a good faith sector to be in here with the next sort of top three months of mine. So, yeah, watch that one closely. They haven't haven't actually bought any like Mozart. But Tom. Yeah, definitely not the one to watch. I've sort of such as buying today actually. What sort of things like you in that Ramsay Healthcare and Woolworths and Telstra. QBE popped up a little bit of CPR things. So there's a sort of four stocks, I think they're not going to be largely affected by what's all the controversy. So just make sure we're choosing the right stocks. [00:10:15][74.5]

[00:10:16] And just a final note, I'm putting this all together. These are the companies that you have picked up. You have been trading the last day or two. You have bought them and you've talked about a three way cycle or possibly 5y cycle in the index. They're selling these into into rallies. Or would you like to hold these throughout the summer? [00:10:33][17.3]

[00:10:34] Yeah. And I question Chris. Yeah. So that the bitwise can beat you. You know, I can I can be sort of sharp. I can be convincing offense so quick. Tom sort of shopowners or sometimes I can be can grind so slowly. Hi there. So if we get a soda shop, they wave sort of something to me. Any goes anywhere near 50 percent of that drop. I'll be straight out there. More than likely, I'd probably be aiming for maybe, you know, maybe less than that. Yes. Well, something around, you know, things we get back to 60 to 50 sites to 200. They might be looking to trade some of those pending weather out. [00:11:11][36.4]

[00:11:12] But I think they'd be wise. Can surprise people. So I'm aware that this might discount this potential bounce. You can surprise as well. So as much as we've been surprised at how fast and how deep this country we might get, pleasantly surprised. [00:11:27][14.5]

[00:11:28] Hopefully will that it's staying. Definitely. [00:11:32][3.3]

[00:11:32] Certainly want to beat it. But I guess the question is a different want to be a seller. If we get it, we got a pretty strong bounce here. We definitely want to be selling some. So I'll probably probably sell half of my holdings in the other half would probably be pretty aggressively running calls on us. [00:11:46][14.2]

[00:11:47] That's a good way to the market. Take the profit when it's there, but also be agile and understand what the market's moving, what it's telling us. And it's just one of those often say there's no certainties. It's only probabilities in this market. [00:11:59][11.6]

[00:12:00] Correct. Thank you very much, Gary Glover from Davis Capital. Thanks, Chris. [00:12:05][5.1]

[697.7]


Arrow Securities Group
 
Copyright © Arrow Securities Group Pty Ltd 2018
 
ABN  30 165 731 144   AFSL 448218