Basically, we start at optimism, which builds in bull markets to Euphoria, then turn all the way down through anxiety and denial to fear and panic before capitulation and despondency set in. And then, after the storms clearing up, there will be some hope and relief, hence optimism starts again once more.
But as the ASX has now officially fallen 51% since it reached a closing all time high of 6828.7 in November last year, the question is: where are we now in the cycle?
The good news is, I do think we passed anxiety, denial, fear, desperation, or even panic. From my own experience, I guess not many things in the market could shock me anymore. We are possibly somewhere between capitulation, despondency and depression. For a contrarian, probably the bottom is very near, if it's not in. We are nearing the point of maximum financial opportunity!!
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