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Assetbubble

NASDAQ Bubble Bust DXY CorrelationThe market peaked in Nov and is in Bubble-Bust-Mode. DXY is breaking out upwards from a multi-year consolidation. Looking back to the DotCom Bubble and comparing NASDAQ to DXY, DXY broke out near the equity peak and reached its peak when NASDAQ was near bottom of the crash. It's not a perfect correlation in shorter time-frames, but close enough that it may be useful on the macro time-frame. If the current Asset/Big-Tech Bubble rhymes with history, look for DXY to continue upward into 110-120 range or higher over the next year or so as NASDAQ plummets back down to reality, e.g. somewhere around the 200 Month Moving Average. Then whenever DXY is crashing back down towards ~100 that may be a good signal that the bottom is in for equities.
TVC:IXIC
by RobBiddle
Is it TIME to BUY GOLD?Since the breakout of the pandemic, the gold, which has gained 40% during its peak, has shed off about 26% of its gain and 19% of its value when it reaches its lowest in early March. If we look back from the beginning of the pandemic breakout, gold, along with Nasdaq and bitcoin were on-demand until early August 2020 where gold took a sharp reversal into a selling spree. While gold continues to trade lower, Nasdaq and bitcoin continued to surge. Demand for gold has been robbed away by fast-growing assets and what else could be better than the US stock market and bitcoin? During early December 2020, the gold took a sharp turn from a bear market and managed to regained 60% of its losses, only to spiral into another bear market with the same magnitude Somewhere 2 months ago in February, rising treasury yield threw a spanner into the gears of the extremely bullish asset prices. The Nasdaq which represents mainly the Tech companies, as well as companies that held the most bitcoin such as Tesla, took a hit along with bitcoin, and so is gold. As of now, what's interesting is that, while gold has found strong support at 1680, both Nasdaq and bitcoin have also faced strong resistance at their February high. It's worth noting that the gold is very discounted and asset prices have ballooned way too much. While this is not a strong enough sign for some major reversal in the entire market trend, how about some major correction in Q2 2021?
TVC:GOLDLong
by AlgoVenture
2
Bitcoin and Reflexivity: a step back from the chartsGeorge Soros' general theory of reflexivity states that investors don't base their decisions on reality, but rather on their perceptions of reality. I will attempt to apply this theory to the Bitcoin asset bubble. First, assume that Bitcoin is in a positive reflexive feedback loop. There are two components to this: an underlying trend that prevails in reality, and a misconception relating to that trend. Here, the trend and the misconception positively reinforce each other and the trend tends toward a dynamic disequilibrium. In the case of Bitcoin, the trend is its inflating value and the misconception is its public perception as a viable store of value (SoV). The relationship between Bitcoin's inflated market value and its perception as a SoV is reflexive, so they positively reinforce each other to further drive up the price of Bitcoin. I think this narrative is driven largely by inflation expectations. If the fear of hyper-inflation eases, this trend and misconception will positively reinforce each other back toward equilibrium. If inflation expectations continue to rise, bitcoin will continue to inflate in value indefinitely. Reflexivity also suggests that it is rational to invest into an asset bubble in a positive reflexive feedback loop. I, therefore, think it is well justified to be in Bitcoin (and crypto assets as a whole) until the trend shows signs of reversing.
BITSTAMP:BTCUSD
by otis_bagshots