Its Over, page-375

First it was AMP's close to 30% single day drop last week, today it was Kogan's 30% fall after revealing a lower expected gross margin following entry of competition (Amazon). Then there was an AFR article disclosing a hedge fund questioning the integrity of Corporate Travel's accounting and operational practices.

Sounds like the times we had with BIG and GSW.... these revelations surely impacts what little confidence investors have in the market at this point.

If you had followed Covered Stocks, most of the closing of positions were done on 5 September, the day the ASX200 closed at 6230 points, about 1.9% off from its 30 August high of 6352. It was a recognisable turning point. Now, the ASX200 is about 628 points off from the high of this year, off 9.9%. It wouldn't surprise me if it retraces down to 5600 in the short term about a zig zag between 5700-5800 and if it crosses 5600, then 5200 would be possible, very close to bear territory of 20% drop.

Some newsletters e.g Equity Story have been positioning folks to start bargain hunting but I think it would be a bit too soon...I'd like to see the outcome of the Nov 6 mid term elections. And I wouldn't underestimate the programme trading in Wall Street that could add a lot more volatility in the days ahead.

But my question is ...if the Big Kahuna is on the horizon, max 2 years, why would you be buying stocks to keep for the longer run. No, you would buy just to trade for months, holding longer would be at your peril. Everything is to trade now, forget dividends (look at banks, TLS) , don't get to keen on growth stocks trading on huge multiples. The APT, WTC, APX may be great stocks like FAANG but as FAANG gets re-rated down, I'd expect the same to happen to our local tech counters as well.