Guessing the bottom

[JDot]

I think we should use the wisdom of the crowd on here to try to guess the bottom of the FTSE 100.

The idea is once we have enough sample guesses we can find the mean and then with a bit more confidence start getting some serious money in. (Greedy!)

I'll start. 4700 FTSE 100 bottom.
Please add your guesses guys the more we have the better.

[vrdiver]

I think we should use the wisdom of the crowd on here to try to guess the bottom of the FTSE 100.

The idea is once we have enough sample guesses we can find the mean and then with a bit more confidence start getting some serious money in. (Greedy!)

I'll start. 4700 FTSE 100 bottom.
Please add your guesses guys the more we have the better.

Not sure the crowds are going to get this one right: if a "cure" comes along quickly, we will bounce back and the low of around 5000 that we've seen recently will be cited as the golden missed opportunity. if things continue to unravel, with more cases of CV19 and no solution except civilian lockdown, I'd be surprised if the markets hold their FTSE100 head above 3500.

For the purpose of your exercise I'll go with 3450.

VRD

[tjh290633]

The current low in closing value of the FTSE100 is 4993, and the market is always looking ahead.

We have had a brief rebound, and my thoughts are that we might see a double bottom then a sustained rise. I predict that the second bottom will be 4800.

TJH

[Itsallaguess]

If things continue to unravel, with more cases of CV19 and no solution except civilian lock-down, I'd be surprised if the markets hold their FTSE100 head above 3500.

Many of the exponential rises seen in the reporting countries are now beginning to level off, and the next few days will hopefully start to cement the idea that there's at least one 'solution' that works, in terms of the social measures taken in those countries, so even in those areas that continue to see rates of infection rising considerably, they'll at least have some models available to show how they can potentially put a lid on those rises...

At the same time, these lock-downs are only one aspect of the strategy, and part of that is to allow time for the other 'let's get better prepared' part of the strategy to start playing out, whether that's to do with temporary hospital capacity, or the important aspect of critical-care equipment, and that's before we start talking about what might turn out to be the much more important aspects of vaccines or other treatments that are being rushed through development..

So there's a lot of moving parts, and I don't think that just looking at the number of 'current cases' is going to tell the full story for our forward looking markets....

Just my view - I won't try to come up with a figure for the FTSE bottom, but I would add that I dipped my toe into the market last week and will probably continue to do so for the next couple of months as we move into the new ISA year...

Cheers,

Itsallaguess

[bluedonkey]

I'm useless at this. My guess is below 4800.

[thirty06]

Of course I can predict the bottom of the market, I can also predict the top of the market and its daily movement. I've been doing it for years.

If I could only have done it correctly...

3432, for one afternoon, after a narrow Labour election win, followed by a blip up to 3746 at close.

After that "It will fluctuate"

[TheMotorcycleBoy]

My current view is the last low just under 5000 is the lowest one.

I've now been WFH for over 2 weeks, loads of other firms, done similar since, and that plus other distancing measures will result in falling numbers of deaths in next month.

Current view is there will be small dips each monday and if a major geezer dies (BJ).

I think the ftses will recover a bit. But if the lockdowns lift too soon and the deaths rise again, then we'll see 5000 again.

Yours sincerely
Nostradamus

[richfool]

In anticipating Coronavirus statistics and trajectories, one needs to be aware that many infections won't be showing up in the official figures because people were told to self-isolate at home and not call 111 unless they started suffering more serious symptoms.

[Lootman]

For the purpose of your exercise I'll go with 3450.

At the height of the financial crisis in 2008 the lowest closing level for the FTSE-100 was 3,665.

So you must think that this mess is bigger than that mess.

[colin]

For the purpose of your exercise I'll go with 3450.

At the height of the financial crisis in 2008 the lowest closing level for the FTSE-100 was 3,665.

So you must think that this mess is bigger than that mess.

This mess might be bigger than that mess, we don't yet know , it's certainly a lot more serious.

[TheMotorcycleBoy]

For the purpose of your exercise I'll go with 3450.

At the height of the financial crisis in 2008 the lowest closing level for the FTSE-100 was 3,665.

So you must think that this mess is bigger than that mess.

This mess might be bigger than that mess, we don't yet know , it's certainly a lot more serious.

My view is that the "main" mess now is in the States. Over 3000 deaths there now. We have just over 1400, and whilst we have a lower population, our population *density* is far higher than Stateside. For example the population density of Tennessee (I used to have a friend there) is about 10x less than the UKs IIRC.

UK cv19 reported death rate has fallen over the last couple days. So my current view is based on how much effect the damage from the US will have on us in the UK, regards our economy, market prices etc.

[tjh290633]

My view is that the "main" mess now is in the States. Over 3000 deaths there now. We have just over 1400, and whilst we have a lower population, our population *density* is far lower than Stateside. For example the population density of Tennessee (I used to have a friend there) is about 10x less than the UKs IIRC.

UK cv19 reported death rate has fallen over the last couple days. So my current view is based on how much effect the damage from the US will have on us in the UK, regards our economy, market prices etc.

There is something wrong with your calculations. The land area of the USA is far bigger than that of the UK, so the population density must be lower than that of the UK. I just looked it up:

USA 9,833,517 sq km, Population 262.2 million

UK 243,610 sq km, Population 64.4 million

So they have about 4 times the number of people in about 40 times the area. I make than 1/10th of the population density. Your fraction is upside down.

Like in London, the problem seems to be associated with urban dwelling, particularly in apartment buildings, where close proximity is unavoidable. The typical Midwestern town in the USA has low densities of housing, whereas the major cities have a lot of high rise living.

TJH

[JohnW]

I'm useless at this. My guess is below 4800.

Making it hard to find the average.

[zico]

For the purpose of your exercise I'll go with 3450.

At the height of the financial crisis in 2008 the lowest closing level for the FTSE-100 was 3,665.

So you must think that this mess is bigger than that mess.

Doesn't it need to be inflation-adjusted since 2008? I've used 3% inflation, and get the equivalent figure for (3665 in 2008) to be 5225 in 2020.
Am I missing something?

I think this mess is bigger than that mess because the financial crisis was "only" banks over-reaching themselves, whereas this crisis is virtually all industries needing to stop for what's probably at least the next 6 months, if not longer. There are huge amounts of demand (and hence profit) that will be lost for ever, apart from the dislocating effects of shutting down, then re-opening.

On the OP question, I'll hazard a guess at 4,700 but that's for an optimistic lowest-level, if there is such a thing. My worst fear is of food supply problems (real or imagined) leading to a breakdown of society. We've already seen panic buying when there was no need to do it.

[TheMotorcycleBoy]

For the purpose of your exercise I'll go with 3450.

At the height of the financial crisis in 2008 the lowest closing level for the FTSE-100 was 3,665.

So you must think that this mess is bigger than that mess.

Doesn't it need to be inflation-adjusted since 2008? I've used 3% inflation, and get the equivalent figure for (3665 in 2008) to be 5225 in 2020.
Am I missing something?

I think this mess is bigger than that mess because the financial crisis was "only" banks over-reaching themselves, whereas this crisis is virtually all industries needing to stop for what's probably at least the next 6 months, if not longer. There are huge amounts of demand (and hence profit) that will be lost for ever, apart from the dislocating effects of shutting down, then re-opening.

On the OP question, I'll hazard a guess at 4,700 but that's for an optimistic lowest-level, if there is such a thing. My worst fear is of food supply problems (real or imagined) leading to a breakdown of society. We've already seen panic buying when there was no need to do it.

Hi Zico,

My firm are still working. That is, we are still designing software and hardware, and writing enhancements. The various teams are still interacting. (I'm not sure what the implications are for the chips, but they are already made in very clean environments). Energy and utility firms must surely still be outputting, and banks are still processing £££ etc.

As a slight aside from my first para. regards the markets the FTSE350 attempted to rise after it opened and I've been testing buy quotes from time to time and although most times iWeb delivers me a quote, every so often it prints this

Negotiated Order

Your order can not be completed automatically

Your order cannot be completed automatically at this time, but can still be submitted as a negotiated order. Reasons for this could include market volatility, the size of your order, or because there is not enough electronic stock available to match your order.

Because your order cannot be completed automatically we cannot guarantee the share price at the time of your trade.

Your order will be sent directly to our Dealers who will negotiate the best price available for your order in the market at that time. All orders will be completed in fair and due turn as soon as is practically possible.

Once you have placed a negotiated order you do not have the facility to cancel this instruction online.
INVEST £1000 XPP - XP POWER LTD ORD GBP0.01 DI

and gives me the option of setting a negotiated order (which I decline). I guess you ppl will say "we've seen this all before" etc. My interpretation of this is that's symptomatic of low liquidity.

My impression is that market makers are trying to egg the market on in the morning, and but there's a lack of enthusiasm in the rest of the players out there.

Matt

[johnhemming]

It does not look like liquidity is that bad in that stock.

[GoSeigen]

UK cv19 reported death rate has fallen over the last couple days.

At the moment it's moved from disastrous to merely awful. May the improvement continue...


GS

[zico]

Statistically, the latest daily deaths figure is an oddity, showing almost the lowest percentage increase since the epidemic started. There's no reason why the death rate increase should have slowed yet, as typically people get infected for 5 days without symptoms, then days 6-13 are mild symptoms, days 14-21 serious symptoms, then hospitalised, days 21+ deaths. 16 days ago was the last day of Cheltenham gold cup, the day when government scientists were telling us large gatherings posed little health risk, and 4 days before people were advised to avoid pubs and clubs.

[dealtn]

My interpretation of this is that's symptomatic of low liquidity.

In normal times there are joined up electronic systems linking the market makers to the platforms. The platforms have rules that oblige the market makers when quoting electronically with the platform to show an improvement (on their indicative real time quotes to the platform) that they must hold for a small period 10 to 15 seconds - its been a long time since I was a market maker, and not in equities, so I'm not clear. This all allows the "usual" market we see as retail users to operate in a seamless fashion.

In times of stress these rules are lifted/relaxed etc. You may no longer be obliged to quote at all times (which in practice actually meant >90%), NMS is smaller, etc.

So in general things don't operate as easily, and the software interface between you, and your broker, or platform provider, doesn't reflect the "real" market, or the interface between your broker, or platform provider and the Market (and the market makers that speak to it). hence a lot of the types of "errors" you are seeing, and the necessity for "trade intervention".

Yes, liquidity is down also.

Hope that helps.

[TheMotorcycleBoy]

Statistically, the latest daily deaths figure is an oddity, showing almost the lowest percentage increase since the epidemic started. There's no reason why the death rate increase should have slowed yet, as typically people get infected for 5 days without symptoms, then days 6-13 are mild symptoms, days 14-21 serious symptoms, then hospitalised, days 21+ deaths. 16 days ago was the last day of Cheltenham gold cup, the day when government scientists were telling us large gatherings posed little health risk, and 4 days before people were advised to avoid pubs and clubs.

Looks as I spoke too soon

https://www.telegraph.co.uk/global-heal ... ts-latest/
https://www.theguardian.com/politics/li ... -19-latest

367 deaths today. Yikes.