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Show HN: Is the stock market going to crash?

isthestockmarketgoingtocrash.com

231–240 of 338 posts

Re: Show HN: Is the stock market going to crash?

#231

Earlier quoted context omitted.

"occurrences that nobody was aware of and that were only understood afterwards" Umm, I'm no genius but I was managing my mother's money at the time of the 2008 crash. It was very obvious to me that there was going to be a crash, I pulled out of the market in late 2006 and didn't lose a dime in the crash. I think the better statement is "The 2008 crash was obvious but many people were in denial". Again, I'm not a fina…

Predicting a crash is easy but timing it with accuracy is extremely difficult. In fact you were two years too early and lost out on a lot of potential return. There will always be a crash/correction. Easy. But when?

The correction will happen immediately following the moment the tape prints it. It always has, it currently is, and will continue to do so in the future.

The problem is people aren't watching the tape. It's thought of "too hard"(by those who fail), which is another way of saying their net ability is inadequate for a career in trading.

The market has always told us what it is going to do, seconds before it happens. You have to be willing to watch those seconds though, and capable of interpreting the tape during them... 1 day candles? too late. 30m candles? too late. 1m candles? maybe, but overall too late. The timeframe you are looking for is "real time", which is present in time and sales(and nowhere else). Anything else is inadequate for consistent profitability, but there is no shortage of people failing to be the exception.

Re: Show HN: Is the stock market going to crash?

#232
post #119
post #69

If you're looking for The Single Greatest Predictor of Future Stock Market Returns[1], here it is: http://www.philosophicaleconomics.com/2013/12/the-single-gre... This is a long read, but it's worth it. The metric can be calculated in FRED[2], and as a predictor of future returns, it outperforms all of the most common stock market valuation metrics, including cyclically-adjusted price-earnings (CAPE) ratio[3]. (Basic…

Wow, really interesting read. Thanks for the link. Only trouble is that once people find patterns like this, they have a habit of disappearing. Hopefully this one is based on solid enough fundamental market forces that it persists after its publication. It was published in 2013 so we won't know for sure until after 2023.

I actually made an automatically updating chart for this using FRED data: http://financial-charts.effingapp.com

TLDR: The correlation did go down a bit since publishing but still seems alright.

Re: Show HN: Is the stock market going to crash?

#233

A site like this seems dangerous at best. Nobody can predict the stock market. Nobody can predict when a stock market is more likely to crash. This site tries to indicate otherwise. Whatever causes the crash it probably won't be one of the indicators listed here.

Predicting the actions of human being is very difficult. The market "crashes" when 2 people throw in the towel. One of those groups is the aggregate of retail+institutional buyers. The other group is market makers. When neither group is willing to bid the price, then that price decreases. When neither group is willing over an extended period of time(say, an hour), we have a "market crash". It's a very hyperbolic way of saying no one is willing to buy, but others are still willing to sell. In that state, the price retreats as buy-side liquidity is consumed, and continues retreating until buy-side liquidity is equal to sell volume. Once buy-side liquidity is in excess of sell volume, then the price moves up.

tldr; "crash" is used to describe a very natural condition, caused entirely by the emotions of human beings.

Re: Show HN: Is the stock market going to crash?

#234
post #58

A site like this seems dangerous at best. Nobody can predict the stock market. Nobody can predict when a stock market is more likely to crash. This site tries to indicate otherwise. Whatever causes the crash it probably won't be one of the indicators listed here.

I think the subtitle sets expectations pretty clearly: > No one knows for sure, but there are indicators that can help us guess. We can chart these indicators to give us the illusion of foresight.

Holy shit, just seeing the "indicators that can help us guess" gives me shivers. The person who utters that phrase is admitting to guessing with their money. Does anyone else find that as absurd as I find it? If I hire a pro to enter/exit a position, if they are guessing(with or without the assistance of indicators), I have made a very bad decision to hire them.

Re: Show HN: Is the stock market going to crash?

#235

American companies sell products & services outside of the United States. Comparing American GDP with the aggregate value of the US stock-market is deeply misleading, especially given a historical comparison: foreign markets such as China have gained in relative importance over timeframe under consideration. When looking at debt, one should not just observe the nominal amount, but also the interest rates, which have…

GDP is a correlated measurement. Trying to use correlated measurements as a leading or primary measurement is one of the many steps on the stairwell down to bankruptcy for a trader.

Re: Show HN: Is the stock market going to crash?

#236
post #119
post #69

If you're looking for The Single Greatest Predictor of Future Stock Market Returns[1], here it is: http://www.philosophicaleconomics.com/2013/12/the-single-gre... This is a long read, but it's worth it. The metric can be calculated in FRED[2], and as a predictor of future returns, it outperforms all of the most common stock market valuation metrics, including cyclically-adjusted price-earnings (CAPE) ratio[3]. (Basic…

Wow, really interesting read. Thanks for the link. Only trouble is that once people find patterns like this, they have a habit of disappearing. Hopefully this one is based on solid enough fundamental market forces that it persists after its publication. It was published in 2013 so we won't know for sure until after 2023.

self destructing prophecy :)

Re: Show HN: Is the stock market going to crash?

#237
post #119

Earlier quoted context omitted.

Wow, really interesting read. Thanks for the link. Only trouble is that once people find patterns like this, they have a habit of disappearing. Hopefully this one is based on solid enough fundamental market forces that it persists after its publication. It was published in 2013 so we won't know for sure until after 2023.

I actually made an automatically updating chart for this using FRED data: http://financial-charts.effingapp.com TLDR: The correlation did go down a bit since publishing but still seems alright.

this is great! you should add shaded areas for official recession periods, it's pretty easy to find:

https://fred.stlouisfed.org/series/JHDUSRGDPBR

Re: Show HN: Is the stock market going to crash?

#239

Earlier quoted context omitted.

Not nearly as bad as some of the "Technical Analysis" I've seen. From what I gather, "Technical Analysis" just amounts to this is what the stock has done in the past, maybe it will do that in the future?

Yes and no. It depends what type of technical analysis you are doing... If your technical analysis has no other inputs except the price(over any period(s) of time), then you may as well go buy a lottery ticket. If you are wondering which category you are in, if at any point during your "analysis" you find yourself looking for things with names like "evening star", "bullish engulfing", "head and shoulders", etc.... sa…

Could you suggest books that go deeper in the second type of technical analysis? Most of what I find online fits well in the first type you described.

Re: Show HN: Is the stock market going to crash?

#240
post #69

If you're looking for The Single Greatest Predictor of Future Stock Market Returns[1], here it is: http://www.philosophicaleconomics.com/2013/12/the-single-gre... This is a long read, but it's worth it. The metric can be calculated in FRED[2], and as a predictor of future returns, it outperforms all of the most common stock market valuation metrics, including cyclically-adjusted price-earnings (CAPE) ratio[3]. (Basic…

One thing to keep in mind is that predicting a downturn in the short-term is different than predicting long-run performance over 10, 20 or 30 years. I think the website is trying to do the former and your article is talking about the latter.
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