The dial on the left indicates bull or bear market status, while the one on the right reflects stock market drawdown risk.
Bull/Bear Market
The ASX Bull-Bear Market indicator remains at 54%, with three of six leading indicators signaling risk-off, while the US bull-bear index (a 40% weighting) is at 60%:
The ASX 200 continues in a strong downtrend relative to the gold price in Australian Dollars.
The ASX 200 Financials Index (XFJ) is retracing to test resistance at 8500, but remains in a primary downtrend.
Stock Pricing
ASX stock pricing increased to the 76.18 percentile compared to 74.05 two weeks ago, and a high of 85.83 in February.
Conclusion
The ASX bull-bear indicator at 54% indicates a mild bear market.
We are entering a bear market, and the risk of a significant drawdown is high.
Acknowledgments
- NAB Monthly Business Survey: January 2025
- ABS: Private Dwelling Approvals
- Trading Economics: China Business Indicators
- Morningstar: ASX All Ords & ASX 20 Statistics
- Market Index: ASX Statistics
- ABS: National Accounts
- ASX: Historical Market Statistics
Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He founded PVT Capital (AFSL number 546090), which provides income and growth strategies to wholesale clients.
Colin also co-founded Incredible Charts and writes the popular Patient Investor newsletter.
Using a top-down approach, Colin identifies macro trends in the global economy and then combines fundamental and technical analysis to evaluate opportunities in sectors that stand to benefit.
Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.