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I get you 1ron, do you think the loss of investor confidence you...

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tictoc60

49 Posts.

15

18/12/19

23:12

Post #: 42040500
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Originally posted by 1ronnie: ↑

If you have noticed, stocks on ASX are increasingly difficult to trade/invest due to inconsistencies and uncertainty in stock behaviour

1. ASX can rise up sharply one day (yesterday) without good reason and become relatively subdued the next
2. Stocks within a class (e.g WAAAX) can rise one day with no follow through buying the next or could fall sharply one day and rise back substantially over next few sessions or could rise sharply one day and drop the next
3. With ASX indices reflecting a 10 point gain or loss, you can have some stocks up by 10% and some dropping by similar margins with no announcements between them
4. And now you even have wide intraday swings on a given stock - swings of up to 3% or more between intraday high and low e.g APT today

It has become difficult to tell firstly, which stock is going to do well on a given day as it may not follow the general market - the stock could underperform/ outperform the market indices by large mile on a given day. The upbeat or downbeat on the market is not uniform. Secondly, you can never tell if there would be follow through buying/selling after rising or pullback on a given stock - technicals not going to help you there. And thirdly, stock sp can swing in a wide band in intraday trading.

This is one of the reason why it has almost become uninvestable in this market. Prior to the downdraft in late July this year, the market rally was characterised as one that is generally upbeat and across the universe of stocks (barring those with known issues/problems) and in particular growth stocks, and the market could discern well between high grade stocks and low grade ones. Now, it doesn't quite matter if it is high grade or not, as some high grade ones are treated with increasing scepticism especially in relation to their relative valuation. The market is also ambiguous in its reaction to announcements whether to consider it positive or negative - and only if there is a spurt of buying then the sp reacts positively as more buying start to follow the lead. This shows the market has loss confidence somewhat and only takes cue from positive buying behaviour instead of conviction.

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I get you 1ron, do you think the loss of investor confidence you heighlight is related to the practices described in this youtube clip?

https://www.youtube.com/watch?v=lpNDjSEaYW0&feature=youtu.be&t=51

It seems that retail investors big and small sometimes feel like they are out of the info loop in regards to what seems to be crazy illogical price action on the ASX (and all other markets) that you point out in your post, I thinjk you are right that ASX trading weirdness is sapping the confidence to invest into companies that we all have done our own research on and would like to suppport (and profit from...lol), but after watching this clip I realise that we retail investors may not be out of the loop at all, the clip points out the retail investors might be right in the middle of that loop and the clip makes that loop look more and more like a noose...lol...

GLTASH's and MXMAS
1 Upvote

0 Great analysis

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