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Well done mole-man.
I was miles out last week but I'm going to stick with my strategy of being overly optimistic and go for 134p next week.
Just be careful out there. Earnings season so far is a bit worrying. 80% of US companies are still beating forecasts, but not by quite as much, and misses are getting punished far more heavily than beats are getting rewarded. That’s a classic sign of the end of a bull run/start of a bear market.
Markets have to drop around 30% at some point to get back to their long term trend lines. I didn’t think that would happen for another year or so, but with inflation showing no immediate signs of slowing down and the Fed getting increasingly hawkish by the day, there’s a good chance that could happen sooner rather later, and whatever happens in the US markets will be replicated over here.
If good earnings reports aren’t pushing the markets up, then the only things that can are a sudden drop in inflation figures or peace in Ukraine, and neither of those look likely over the next few months.
VOD also haven’t delivered any major deals and seem to be running out of options. They might pull a rabbit out of the hat but if they don’t I can see this dropping back to at least 120 next week, and if markets continue to decline it could easily be testing the lows of 2021 or even 2020 again.
Nothing is certain of course, but too many downside risks for me at the moment. I’ve made some good money on VOD and other shares/indexes in the last year but I sold out of nearly everything (including VOD) last week and will wait and see what happens over the next few weeks/months. Nothing looks particularly cheap to me at the moment and I’ll wait until it does.
Sorry if that’s sounds a bit doom and gloom, but that’s just how I see things at the moment. Good luck all whatever your strategy.
"Markets have to drop around 30% at some point to get back to their long term trend lines."
Compound, I respect your views and I also understand the saying, "when the US sneezes the world catches a cold", but the FTSE hasn't seen the same overvaluations seen within the US markets over the last 10 years.
https://www.google.com/finance/quote/UKX:INDEXFTSE?comparison=INDEXDJX%3A.DJI%2CINDEXSP%3A.INX%2CINDEXNASDAQ%3A.IXIC&window=MAX
It isn't written in stone that the FTSE will follow the US down, and various stocks may benefit from a rotation between markets, sectors and categories of stocks. You could be right, but jumping out now doesn't guarantee success since the FTSE is currently undervalued anyway.
Nothing is ever written in stone with financial markets - all you can do is look at the balance of probabilities and have a strategy where the balance of probabilities and/or the risk/return are in your favour. The only thing that has been consistently true from the time markets began to date, is that economies keep growing and equity markets go up over the long term. Different sectors/countries will fair better or worse during different market conditions/cylces. Total returns on US markets have been significantly higher than UK markets for the last 13 years, but that hasn't always been the case, and may or may not be the case going forward. Valuations are higher in the US for variety of reasons, but it's mainly due to the US having had higher economic growth during that period so investors are buying on anticipated future profits, and also the perceived 'flight to safety' in buying mega cap stocks denominated in US dollars. If you remove one or both of those factors, then US stocks could take a right beating. The FTSE has much lower valuations as they are bought closer to current profits with not much growth factored in. If the US and UK economies both flatlined, then from a valuation perspective the US should take much more of a beating that the UK, but if sentiment turns in the US, it turns globally so I don't think we'll see the markets going in opposite directions. FTSE has been far more resilient that the US since January, but that's mainly due to the US markets having a much heavier weighting towards tech which has done badly and the FTSE being much more weighted towards energy and basic resources which have done well with soaring commodities prices.
My decision to sell was a personal one based on my own circumstances and I did it last week before the big drops Friday and this morning. That move by no means guarantees me greater success over the longer, but it did lock in a lot of profit that I didn't want to risk losing. I'll still keep adding to funds every month in my pension as I won't be touching any of that money for a while and I know that strategy has the highest probability of being profitable over the longer term, even if it it doesn't have the highest probability of being the most profitable. My trading capital is different story and most of that is in cash now. I'll wait until there's blood on the streets before I deploy too much of that, even if that means waiting a while. They are two very different strategies, but between them other aspects of my situation, it means I'm covered for all eventualities although some will be more profitable for me than others.
I know people like binary answers and some of what I am saying may sound contradictory, and it is, but that's the whole point - none of us know exactly what's going to happen and when. We need to accept that and build that uncertainty into our long term plans.
Anyway, best of luck to all of you - I need to get some work done!
Well I must confess my Friday prediction smacks of desperation, but at least vod is beating the f.t.s.e. today. Can we end up today?