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Coronavirus-bear-market-2020-analysis

Coronavirus Dow Stocks Bear Market Trend Forecast Update - Part1

Stock-Markets / Stock Markets 2020 Mar 09, 2020 - 09:43 AM GMT

By: Nadeem_Walayat

Stock-Markets

This analysis continues from (How Deadly is the Coronavirus - Case Fatality Rate (CFR) Analysis) that seeks to conclude in a probable trend forecast for the unfolding Coronavirus stocks bear market that has caught most market participants by surprise, one where the formulaic mainstream financial press see's a bottom in EVERY BOUNCE! Well the Dow's latest plunge Friday makes a mockery of such expectations of barely a few trading days ago! For as I try and point out from time to time that technical analysis on it's own is NOT enough! Which is why I try and keep my antenna's focused on any outside market influencing factors that could drive stock prices at some point in the future where we have the usual drivers such as population growth, climate change, governments printing money that resulted in driving the Dow from a 1930's low of 40 to the recent high of 29,600. Without money printing there would be no exponential stocks bull market as the indices rotate in new rising corps and eject old dieing corps. Likewise, way back in January when most were shrugging their shoulders to "corona what?" my antenna was focused on what was taking place in Hubei China that was sending alarm bell rings despite art the time the Dow was was busy making a series of new all time highs.


Whilst monitoring the unfolding pandemic in China, I was increasingly struck by the fact that our governments in the West were just NOT ACTING as I though they should be. I am no virologist or scientist, but if I could see the unfolding catastrophic consequences of the Coronavirus then why have our governments been sat on their lazy asses for at least the past 6 weeks and basically done nothing!

They have been shockingly negligent! And my assumptions of early February that the West would do a far better job at containing the Coronavirus than China have all gone up in smoke! INEPT! INCOMPETENT, as it appeared the likes of the CDC and the Public Health England were doing their utmost to BRING the VIRUS into densely populated areas that risked the virus out breaks! I am no conspiracy theorist but various Governments actions were at the very least negligent and at worst CRIMINAL! YOU DON'T FLY IN INFECTED PEOPLE AND THEN DISTRIBUTE THEM ACROSS THE COUNTRY!

YOU DON'T ALLOW AIR TRAVEL FROM REGIONS WITH OUT OF CONTROL OUTBREAKS!

THEY DID NOTHING! Even now as of writing the US has yet to actually begin mass testing for the coronavirus which given it's lethal nature, not because of the 1% to 3% death rate but the fact that infected people can be asymptomatic for as long as 2 weeks! Which means quietly spreading viral particles all whilst the likes of the CDC are sleep to the wheel, unable to even pick up the phone and place an order for coronavirus tests! And only doing so a week ago!

China looks like it has gained a grip on it's pandemic by crippling it's economy even if the figures for the numbers infected are likely still being under reported for political reasons, which obviously the general population do not trust.

Unfortunately, the West has very badly dropped the ball by NEVER ACTING PROACTIVELY to prevent OUTBREAKS, instead the imbeciles continued to let infected Chinese nationals and others fly into our virus free nations spreading their viral particles that have now sparked outbreaks across Europe and the US. Which translated into my unfolding analysis that increasingly warned that this Coronavirus stocks bear market is nowhere near bottom! Where outbreaks outside of Asia such as in the UK and US are only just beginning whilst incompetence continues to rule! For instance the US is still waiting on delivery of 1.2 million tests that the CDC promises will be sent out this week!

This is a recipe for disaster that COULD HAVE BEEN PREVENTED! What we are about to witness in the West was NOT INEVITABLE!

The current tally of 216 infected in the UK and 438 in the US (7th March) is likely under reporting the actual number of infected in both nations by several orders of magnitude as the price paid for gross incompetence bordering on criminal and it does not help having an idiot in the White House!

If I had to put a number on how many are infected in the UK and US right now given the percentage who are testing positive, and taking into account abysmal lack of testing than likely right now then the UK has at least 1000 infected people many which will become ill and get tested and make their way into the official data over the coming week, so this week expect the UK to soon pass 1000 infected people as they ramp up testing because 21,500 tests to date whilst a lot better than the US, is still not enough to contain this virus.

Whilst for the US, with less than 6000 tests to date of which 7.4% have tested positive implies a huge pool of infected people, a number that I can only guess at being at least 4000, most of whom will start showing symptoms over the coming week whilst continuing to infect 3 to 4 others, as was the warning out of South Korea. So a week from now if the US actually starts rolling out tests in significant numbers then the US infected tally could easily increase ten fold to at 4000 during this coming week.

Thus the implied infections trend trajectory for the US is currently running at about three times worse than my forecast as people are not being tested in enough numbers which they should start being done during the coming week, given that the CDC has promised to deliver at least 1 million test kits to the states during the week. Whilst it is too early to speculate on the CFR for the UK and US as the decline from 5.75% (5th March) to 4.34% (7th March) for the US illustrates.

The lack of US testing means that there is a massive hidden unrecorded pool of infected people that continues to quietly expand EVERY DAY until they finally start to fall ill and end up in A&E and go on to infect medical staff. And from what I see the US is still largely in a state of denial with political campaign rally's continuing as though the virus does not exist. So pert haps the US will only truly start to act when the body bags start piling up in their hundreds.

Thus the number of infected looks set to EXPLODE higher, far beyond today's tally of 450 infected and 19 deaths. My forecast is for 13,000 infected by the end of March, that number now could easily double because without knowing who is infected then there are no quarantine and containment measures in place. I will look at updating my forecasts into the End of April for the UK and US at the end of next week.

This rest of this analysis has first been made available to Patrons who support my work. Coronavirus Dow Stocks Bear Market - March and April 2020 Trend Forecast

  • Stock Market Trend Implications
  • Coronavirus Global Recession 2020
  • Short-term Trend Analysis
  • Long-term Trend Analysis
  • ELLIOTT WAVES 
  • Formulating a Stock Market Trend Forecast
  • Dow Stock Market Forecast Conclusion
  • Investing in AI to Kill the Coronavirus
  • AI Stocks Q1 Buying Levels Current State.
  • KIlling the Coronavirus!

So for immediate first access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $3 per month. https://www.patreon.com/Nadeem_Walayat.

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Your Analyst

Nadeem Walayat

http://www.marketoracle.co.uk

Copyright © 2005-2020 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Housing Markets Forecast 2014-2018The Stocks Stealth Bull Market 2013 and Beyond EbookThe Stocks Stealth Bull Market Update 2011 EbookThe Interest Rate Mega-Trend EbookThe Inflation Mega-trend Ebook

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

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© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


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