[Discussion] How Do You Tell When a Market Armageddon Is Coming?
Some say that a market crash is the best opportunity for ordinary people to make money. Most retail investors have small capital and average trading skills, so they rarely make significant profits in normal markets. But a crash is different — after a major plunge or even a 50% wipeout, going all-in can lead to outsized gains.
But how can you tell whether something is truly a market crash? And when should you start bottom-fishing?
For most investors, the biggest question during a downturn is when to buy the dip.
If you buy too early, the volatility will shred your nerves; buy too late, and you miss the bottom — or hesitate to buy during the rebound. Either way, you end up making nothing.
Some say sentiment is the key to judging whether it’s time to bottom-fish and whether the situation qualifies as a crash.
Today, the fear index for the market has already reached 7 — extreme fear. But back in April, extreme fear dropped as low as 4. So does that mean we haven’t bottomed yet?
If we really repeat April, the downside could be much worse. And for now, $NASDAQ(.IXIC)$ is only down about 8% from its high and still up 14% year-to-date, which hardly counts as a crash.
Others say you can judge it by watching your friends or your stock-trading groups.
At the start of a decline, everyone still blames the CEO or curses at the market. But once most investors are deep in losses, out of cash, and too defeated to complain, that’s when the bottom is in.
So some believe you should always keep at least 50% of your funds available — ready for the next real crash.
Although the market is dropping sharply right now, the scale of the decline still doesn’t look like what we saw in April.
So how do you know when a true market crash has begun?
And which indicators can help you pick the bottom?
Leave your comments to win tiger coins!
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I also watch the mood in stock groups. Early in a decline, people still rant and blame CEOs. The real bottom often appears when everyone goes quiet — when losses are deep and no one has energy to complain. That kind of silence is a stronger signal than any index, and we’re not there yet.
So at this point, I don’t think this is a true crash. The drop is sharp but lacks clear signs of capitulation. To find the real bottom, I look for extreme fear, investor silence, forced selling, and irrationally oversold prices. Until those show up, I stay patient.
@Tiger_comments @TigerStars @Tiger_SG
While our fear is valid, history - that relentless teacher whispers a different story. It reminds us that the markets always go up in the long run.
Our goal isn't to perfectly time the market armaggedon or to pinpoint the absolute bottom. The futility of that task would shred anyone's nerves. Buying too early feels like a gut punch. Buying too late means missing the opportunity.
The good news? We don't have to choose.
Wisdom lies not in the timing but in the process. Our mission is to focus on what we can control - our emotions & our actions.
This is where the quiet, consistent power of dollar cost averaging comes in. Our patience & discipline will be the things we look back with pride when the sun shines on the market again.
@Tiger_SG @TigerStars @Tiger_comments @TigerClub @CaptainTiger
Key indicators of a market crash include overvaluation, rising debt levels, interest rate hikes, yield curve inversions, extreme investor sentiment, and weakening economic fundamentals, such as slow GDP growth, rising unemployment, and falling corporate earnings
To identify a market bottom, watch for extreme fear, high trading volume signaling capitulation, and signs of recovery in key stocks or indices
The most effective approach is not to try to time the market, but to use these indicators for risk management, recognizing when the warning signs point to a risky top and when bottom indicators suggest capitulation
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@Huat99
@Snowwhite
Indicators that can help to pick the bottom:
- RSI below 20
- VIX above 30
- Price action shows the trend touching previous resistance level.
Phase 2: Dropping of another few days of -1% to -3% after the 1 st technical rebound..
This time round, it seems like market sentiments have cooled and everyone is slowly following to trend to cash out, and likely some are done in panic to try and catch whatever profit they still have.
It can be a good time to keep buying as the dip happens, speculating it feels silly lest you miss out on a good deal.
第一，情绪是否麻木。不是恐慌，而是“连抱怨的力气都没有”。
第二，是否出现被迫卖出。比如 ETF 折价、融资断头、基金被赎到崩。
第三，优质股是否被无差别砍价。龙头公司跌到估值极端，这通常是末段信号。