{"id":62258,"date":"2025-08-09T02:49:16","date_gmt":"2025-08-09T02:49:16","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=62258"},"modified":"2025-08-09T04:05:35","modified_gmt":"2025-08-09T04:05:35","slug":"asx-stock-pricing-climbs-to-a-new-extreme","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2025\/08\/09\/asx-stock-pricing-climbs-to-a-new-extreme\/","title":{"rendered":"ASX Pricing climbs to a new extreme"},"content":{"rendered":"
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\"Bull-Bear<\/div>\n
\"Stock<\/div>\n<\/div>\n

The gauge on the left indicates bull or bear market status, while the one on the right reflects stock market drawdown risk.<\/p>\n

Bull\/Bear Market<\/h2>\n

The fall in the US leading indicator dragged the ASX Bull-Bear Market indicator down to 56%, back into a bear market, from 64% last Friday. The decline is due to the US index’s 40% weighting in the ASX Bull\/Bear indicator.<\/p>\n

\"ASX<\/p>\n

Two of the remaining six indicators, from Australia and China, signal risk-off, with a combined weighting of 60% in the ASX Bull-Bear Index.<\/p>\n

Australian private dwelling approvals jumped to 16.7K in June, lifting the 3-month moving average above its long-term signal line and reversing the risk-off signal from last month.<\/p>\n

\"Australian<\/p>\n

However, China’s National Bureau of Statistics Manufacturing PMI retreated to a bearish 49.3 in July from 49.7 in June. A fall below 49.0 would signal risk-off.<\/p>\n

\"China<\/p>\n

Stock Pricing<\/h2>\n

ASX stock pricing climbed to a new high of 91.23 percent from a low of 67.85 in April.<\/p>\n

\"ASX<\/p>\n

We use z-scores to measure each indicator’s current position relative to its history, with the result expressed in standard deviations from the mean. We then calculate an average for the five readings and convert that to a percentile. The higher that stock market pricing is relative to its historical mean, the greater the risk of a sharp drawdown.<\/p>\n

The All Ordinaries climbed to 18.0 times highest trailing earnings in July, a level only exceeded during the Dotcom bubble and the boom before October 1987.<\/p>\n

\"All<\/p>\n

Conclusion<\/h2>\n

The ASX is back in a bear market, while valuations climbed to a new extreme, increasing the risk of a significant drawdown.<\/p>\n

Acknowledgments<\/h4>\n