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Bubbleburst

Be Warned: The Crypto Crash Is Coming**Be Warned: The Crypto Crash Is Coming** It won’t happen today, and it won’t happen tomorrow, but it *will* happen probably at the top of this cycle. Be warned, stay aware, and get ready. Have you lived through the dotcom crash of 2000? Back then, I was the European Director for one of the top 10 internet companies, poised to go public. Our IPO paperwork, courtesy of Deloitte, was ready to roll in March 2000. Now, I’m in crypto, and I see history repeating itself. We are in a massive bubble, and it’s going to burst. In 2000, countless companies—including ours—were making absurd amounts of money through advertising. It defied logic. Many of these companies had little to no real value apart from "eyeballs" or page views. Compared to traditional businesses like manufacturing, their valuations—often in the hundreds of millions—were nonsensical. At that time, Altavista was the leading search engine, while Yahoo, About.com and Lycos were internet giants. When the dotcom bubble burst, the internet sector lost 99% of its value, and the NASDAQ plunged by 78%. The biggest names, the safest investments, were wiped out. Everyone—*even the so-called holders*—suffered. --- ### The Current Crypto Market: Déjà Vu What’s happening now is eerily similar. - Ridiculous projects are being valued at billions, even though most aren’t being used for anything substantial. - Worse, crypto hasn’t gone mainstream; most people only use it for speculation or gambling. **Reality will strike again.** When? Likely at the peak of this cycle. It’s crucial to sell before the crash because many "big names" like Polkadot and Cardano could completely collapse. Around 99% of all altcoins will go bankrupt or get delisted. --- ### Why This Might Be a Good Thing After the dotcom crash, legitimate companies like Amazon, Google, and Facebook emerged stronger. The noise of scams and Ponzi schemes was wiped out, allowing real innovation and better investment opportunities. --- ### How the Crypto Crash Will Happen Do you think giants like BlackRock love crypto? They don’t. Their profits come from gold, USD, and owning over 50% of NASDAQ companies—not to mention their stake in military manufacturers. They’re not here to "save" crypto. Instead, they’ve launched a Trojan horse strategy. By purchasing BTC and ETH—the most valuable assets—they’ve positioned themselves to control the market. Once they’re ready, they’ll crash the rest of the crypto space. Bitcoin and Ethereum will survive, and BlackRock will profit enormously, as funds from worthless altcoins flow into their solid holdings. --- ### What This Means for You I love crypto, but when meme coins hit $20 billion in valuation, you know something is wrong. And guess what? You’re right. Mark my words. Be prepared. - When your altcoins have made you money, **sell.** - Move your USDT to your bank account. - Wait for the next cycle. This strategy won’t just help you avoid the next bear market—it could save you from the looming crypto crash entirely.
CRYPTOCAP:TOTAL3
by CryptoNikkoid
1
Is Palantir in a Danger Zone? We will see after the report... Palantir is about to announce its quarterly report. As we analyzed in the last report, the price reached its highest point after several years, but after reaching this liquidity zone, it had a pullback as we announced before. However, Palantir is showing strength in this area, and we ended on the last candle where it will attempt again to surpass this liquidity zone with strongly. Will it succeed? I believe Palantir has the volume to continue moving a bit higher, but at this point is entering an area where the upward momentum is slowing significantly. On one hand, we’re seeing a double-top forming, and the candle hasn’t fully formed yet. We need to wait and see if the next candle shows liquidity. If so, we should be cautious about the wick length, as that could signal trouble for Palantir. so with the earnings report approaching, there is a lot of uncertainty, which may make it difficult for the price to break this liquidity zone. We should stay alert this November 4th. Palantir has excellent fundamentals, but its recent reports have barely exceeded analysts' expectations. If this report misses even by a small margin, I think we could see a significant drop due to the stock being heavily inflated. Here are Palantir's latest results: Nov 02, 2023 2023 (Q3) Analysts = 0.06 / Reported = 0.07 (BEAT) Feb 05, 2024 2023 (Q4) 0.08 / 0.08 May 06, 2024 2024 (Q1) 0.08 / 0.08 Aug 05, 2024 2024 (Q2) 0.08 / 0.09 Nov 04, 2024 2024 (Q3) 0.09 / (Mon, Nov 4) Thank you for supporting my analysis. TRADE SAFE! Best regards!
P
by RocketMike111
Teleperformance : Bubble about to pop.Ladies and gentlemen, i'm trying a new format here. Please let me know what you think about it. What is Teleperformance ? Teleperformance is an omnichannel company headquartered in France. Company revenue totaled US$5.258 billion in 2018. The action outperforms most of the french assets during the last 8 years with an increase of more than 1200%. Type of trade : Reversal. Type of market : irrational (bubble). My view : People who follow me know something : "Trees don't grow to the sky".And i'm the woodcutter. The chart has make a nice parabolic structure which is about to end. Let the crash begin. Stop-loss : Over/= 221. Please tel me in the comment section which asset you would see me to analyse. DISCLAIMER : I'm not financial advisor. You trade at your own risk. CONTACT : If you want more information, please send me a pm.
EURONEXT:TEPShort
by KassandrA_dotcom
4
Long term indicator to identify Bubble territoryBollinger bands applied on the 1M Log chart create this fjord/valley forms that signal in advance that the peak is arriving and that we are in a big bubble territory. This won't tell you the exact month when to sell, but it signals when we are entering the bubble territory, so you can know whether or not it's still safe to enter, and start selling going up hill. Vertical lines are halving dates just for reference. The red circle is an approximate when the peak will probably take place.
INDEX:BTCUSD
by ecairol
Rate Cut 1930 - Pattern Recognition: 30s vs Today In 1930, when the Fed cut interest rates, the market crashed further. In today's tutorial, we will be comparing the 30s and today’s market to identify some of their similarities. Where exactly are interest rates’ direction pointing us? As we may have read, many analysts are forecasting that there will be a few rate cuts in 2024. Is this the best option? My work in this channel, as always, is to study behavioral science in finance, discover correlations between different markets, and uncover potential opportunities. Micro Treasury Yields & Its Minimum Fluctuation Micro 2-Year Yield Futures Ticker: 2YY 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 5-Year Yield Futures Ticker: 5YY 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 10-Year Yield Futures Ticker: 10Y 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 30-Year Yield Futures Ticker: 30Y 0.01 Index points (1/10th basis point per annum) = $1.00 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
TVC:DJI
by konhow
40
Bitcoins bubble about to burst?Its possible bitcoin has finished 5 waves up on the macroscale. If it has we have entered a long and devastating bearmarket that Will last years. Watch out for break out of the wedge to the downside. If we dip below 20 k it could get ugly. We will have to see how the waves develop. Im not sure if the red wave 4 in the blue wave 5 is still ongoing( I doubt it). If it is we Can expect one more high. For now we watch if the move Down from top unfolds in 5 waves and how deep it goes.
BNC:BLX
by WaveNerd
1
📌Stages of a bubble (LUNA)📈🔘📉Fear has a far greater grasp on human action than the impressive weight of historical evidence.” — Jeremy Siegel. The stages we have seen recently for Luna are very similar to the stages of an Economic Bubble no matter what the market is necessarily , whether it is stock, or cryptocurrency , and other asset classes, It usually happens . Markets rise and fall, and they can fall quite a bit too—this is what you signed up for. Good times don’t last forever, and neither do the bad time sit’s a cycle. So don’t draw conclusions from the past and project them into the future. Usually Bubbles can only be observed after they happened, as there are not always clear signs of them visible. But there is strong evidence that almost every bubble was going through the same stages. The Economist Hyman P. Minsky was the first one to outline these 5 stages, and so we will explain them in a little more detail. Bubbles (financial manias) unfold in several stages, an observation that is backed up by 500 years of economic history. Each mania is obviously different, but there are always similarities; simplistically, four phases can be identified: Stealth >> Those who understand the new fundamentals realize an emerging opportunity for substantial future appreciation, but at risk since their assumptions are so far unproven. So the “smart money” gets invested in the asset class, often quietly and cautiously. This category of investors tends to have better access to information and a higher capacity to understand the wider economic context that would trigger asset inflation . Prices gradually increase but often completely unnoticed by the general population. Larger and larger positions are established as the smart money starts to understand better that the fundamentals are well-grounded and that this asset class is likely to experience significant future valuations. Awareness>> Many investors start to notice the momentum, bringing additional money in and pushing prices higher. There can be a short-lived sell-off phase taking place as a few investors cash in their first profits (there could also be several sell-off phases, each beginning at a higher level than the previous one). The smart money takes this opportunity to reinforce its existing positions. In the later stages of this phase, the media starts to notice with positive reports about how this new boom benefits the economy by “creating” wealth; those getting in becoming increasingly “unsophisticated”. Mania>> Everyone is noticing that prices are going up, and the public jumps in for this “investment opportunity of a lifetime”. The expectations about future appreciation become a “no brainer,” and a linear inference mentality sets in; future prices are an extrapolation of past price appreciation, which of course, goes against any conventional wisdom. However, this phase is not about logic but a lot about psychology. Floods of money come in, creating even greater expectations and pushing prices to stratospheric levels. The higher the price, the more investments pour in. Fairly unnoticed from the general public caught in this new frenzy, the smart money, as well as many institutional investors, are quietly pulling out and selling their assets. Unbiased opinion about the fundamentals becomes increasingly difficult to find as many players are heavily invested and have every interest to keep asset inflation going. The market gradually becomes more exuberant as “paper fortunes” are made from regular “investors,” and greed sets in. Everyone tries to jump in, and new intrants have absolutely no understanding of the market, its dynamic, and fundamentals. Prices are bid up with all financial means possible, particularly leverage and debt. If the bubble is linked with lax sources of credit, then it will endure far longer than many observers would expect, therefore discrediting many rational assessments that the situation is unsustainable. At some point, statements are made about entirely new fundamentals implying that a “permanent high plateau” has been reached to justify future price increases; the bubble is about to collapse. Blow-off>> A moment of epiphany (a trigger) arrives, and everyone roughly at the same time realizes that the situation has changed. Confidence and expectations encounter a paradigm shift, not without a phase of denial where many try to reassure the public that this is just a temporary setback. Some are fooled, but not for long. Many try to unload their assets, but takers are few; everyone is expecting further price declines. The house of cards collapses under its own weight, and latecomers (commonly the general public) are left holding depreciating assets while the smart money pulled out a long time ago. Prices plummet at a rate much faster than the one that inflated the bubble. Many over-leveraged asset owners go bankrupt, triggering additional waves of sales. There is even the possibility that the valuation undershoots the long-term mean, implying a significant buying opportunity. However, the general public at this point considers this sector as “the worst possible investment one can make”. This is the time when the smart money starts acquiring assets at low prices. Economic Bubble Summary With many kinds of economic bubbles in history, we see that there is always a potential for growing a bubble due to our nature. Behavioral economics shows that we follow the herd, we only look at information we like, and we tend to oversee facts because we are gamers by nature. This will lead also in future to many more economic bubbles which will spur interest from a new technology, new paradigm and finally lead to a new economic cycle which starts after the contraction after a bubble. We will see what bubble will form in the future, and most likely we will only see it coming when it is too late. Especially with leveraged bubbles we will see even bigger impacts on our economy, not just for the specific niche the bubble was built in as the (financial) economy is more interwoven and interdependent globally. We should also not forget that fast spreading media news, social media filter bubbles and increasingly more extremist society, we will have a lot of amplifiers what will help spur new bubbles. sources: Wikipedia - transportgeography.org-morethandigital.info-zerodha.com -------------------------------------------------------------------------------------------------------------------- 👉This article is for informational purposes only. 💜 if you're a fan of my Ideas PLZ follow me and give a big thumbs 👍 OR drop comment 🗯
L
by PRO_SMART_Trader
2
Serious Risk For Microstrategy & Bitcoin (MSTR + BTC)This is a short post. Over the last few months, I've written and spoken about why Michael Saylor's entrance into Bitcoin has contributed to my skepticism about the valuation of the market, since the MSTR chart eerily echoes the bubbly behavior from the dotcom boom. As leverage and profit come out of the market, I think MSTR will be severely impacted. Saylor himself has said that holding MSTR is the closest you can get to holding a Bitcoin spot ETF. I think this is all going to backfire, and result in a precipitous drop for both. If MSTR declines back to $160 per share, I expect Bitcoin also to fall at least 50% and break the $20k line. As shown on the left, Bitcoin can bounce at this trendline to begin the next month and perhaps make an attempt at the $50k level. This is seeming less and less likely, but you never know! I always acknowledge the alternate possibility. We'd need to see a dovish shift from the fed and/or student loan cancellation for that to occur, in my opinion. Immediate Bearish targets for Bitcoin: $17.2k $13.4k $9.7k MSTR: $227 $165 $121 This is not meant as financial advice. This is meant for speculation and entertainment only - this represents my opinion. There are plenty of other opinions out there :) -Victor Cobra
NASDAQ:MSTRShort
by VictorCobra
8
HGX Realestate Housing Bubble 2008.2Here's the monthly chart on this housing index. I have no idea what I am charting but it looks like the index is moving with the recent major events such as FED increasing rates finally, everyone is FOMO into buying a house and everyone and their grandmother are becoming real-estate agents haha. FED are supposedly cutting back on MBS purchasing also. With that said.. This isn't 2008! Buy now before your priced out. Stonks/Hoomz prices only goes up! Great investment, a hoom is your piggy bank!! LOL
NASDAQ:HGXShort
by legcramp89
Do it like GreeceStudy the greek economy & politics from the period 1990-2012 and you might find a lot of similarities with that is currently happening in the US. Greece experienced a credit boom from 1990-2008, people however were living above their means. We faced the biggest bubble in Greece's economic history during the 1999 when everybody was playing the stock market! and i mean everybody! i remember my father telling me that the biggest sign he saw that the bubble was about to pop was when his mother in law (late 99) came and told him that she wanted to play the stock market as well! When he asked her why she replied: because the other granny across the street is making money... That was the sing! who the hell was left to buy???? Then the bubble popped together with the .com bubble but people were not selling in the contrary in 2003 they start borrowing and selling their houses,farms whatever they had and played all in! because in their mind and in the media that was the bottom! The ultimate buy the dip!!!then we had the golden age of modern Greece! Various outstanding sports events wins! like the Euro 2004, beating the US Basketball Team, and the cherry on top hosting the Olympic Games of 2004, oh boy euphoria was back in the game and this time for good! We were borrowing more and more money to live a life we could not support! our debt got bigger and bigger but when the 08 housing market popped it was time for us to pay our debts! You know what happened next! check the graph here (www.capital.gr) but only till 2012 because then we had to recapitalize our banks 4 times so the graph is not representative of the whole market. From a political perspective the 2 biggest political parties left and right had to form a government together in order go through this tough period. Our debt was restructured and taxation went sky high! especially for the middle class who paid the majority of the bill! How are things now? well we sold almost all our assets to foreign investors/countries for peanuts! we got used after 10 years to a -50% income and prices are something like 100%-200% higher than 2000...
SP:SPXShort
by Philoslother
SPX Printing A MASSIVE Bubble. Be Very Careful !!On the left side of the chart i've compared a chart from 1891 - 1935 to show the similarities between chart back then and todays after the dot-com bubble. The orange chart is not stretch out or anything. It is there to show that when the bubble popped, price did eventually fall below the bottom of the previous sideways range (orange box). In '29 chart also reached above all the fib. extension levels, just like it is doing right now as it is preparing for the final blow of top which is in my opinion only a few % away. I did the same price comparisment with DJI index in one of my ideas, where the price behaves almost the same as it was from 1915-1929. Really scary stuff if you think about it. Wonder how will that effect the crypto market as it has never experienced a REAL stock market crash. I am not a financial advisor so non of this should be taken as a financial advise. Be well. SP:SPX
SP:SPX
by AVA37
DRV - Long Feb 2022 $7 callsReal Estate starting to feel the pain in China as Evergrande implodes - How much longer before the contagion spreads? Weeks? Months? Clock is ticking. DRV x3 Real Estate short ETF has a couple nice Gaps to fill at ~$12 and ~$20. Stoch and RSI appear to be confirming a potential bottom/turn back up here on the weekly. AO also predicting a move up sooner than later. Last few times the RSI got this low on the weekly - DRV spiked hard soon thereafter. Adding to Feb 2022 $7 calls. Not financial advice.
AMEX:DRVLong
by Akksujean
1
How The Everything Bubble Will Burst...And How To Profit From It I also created a video about my post for those that prefer to watch it here it is: www.youtube.com It also contains all the graphs and charts which unfortunately I can not post here. More and more market participants are talking about rising inflation and the everything bubble being the buildup to an epic crash. But is this really true? Can markets go anywhere but up? So far since the beginning of 2020 Oil is up 103% Gas 94 % copper which is key in all our electronics is up 126% iron the most used metal is up 150% coffee is up 101% corn is up 78% wheat 49% and sugar 87% The housing market is up, the collectible market is up and the stock market does not look any different. The S&P 500 has recovered above pre covid levels and gained 100 % from the bottom all the while setting 43 all time highs year to date literally a new all time high every 3.5 days in 2021 and on track to beat the record of 77 yearly all time highs in 1995. Running hot? Maybe a little... Or maybe the economy is just growing at a really fast pace? Looking at the ratio of market value to GDP however the markets are extended over a large margin to where they should be in relation to GDP. So whats going on here? Are we really in an everything bubble that is going to pop and if so how can you invest so that you make money? Before we can answer these questions we need to understand what a bubble is. Whats a bubble A bubble is defined as an economic cycle characterised by a rapid increase in market value particularly of asset prices. It is commonly accepted that bubbles arise due to the psychology of investors. They can appear across single assets, asset classes or entire markets. Bubble Cycles Bubbles always follow more or less the same pattern as we will see when we look at some bubbles that have occurred throughout history. At first things start slow as the smart money and early adopters get in on the trade. More and more professional investors start to pile in as the price starts to increase leading to awareness of the opportunity to rise until it breaks into the public. As more and more people learn about the trade and jump in because of greed and fear of missing out price starts to really take off and run away from fundamental valuations. It is this stage where mass psychology gets more and more amplified feeding into itself leading to enthusiasm turning into greed and delusion as prices reach higher and higher. The stock market is a zero-sum game the profits of one market participants are anothers losses. The more retail is buying the more profits the smart money are taking. This then is one of the most telling signs of a bubble: retail investors coming in and pushing prices ever higher left to hold the bag when the smart money ultimately leads the market lower in taking all their profits. Famed investor Jim Chanos is warning about exactly this and just said in an interview with CNBC “The problem with getting more people, retail, involved is that it always seems to happen toward the end of every cycle. Retail wasn’t there at ’09 at the bottom. They weren’t there in ’02 after the dot-com bubble collapsed. They were certainly there at ’99,”- (Buying at the top that is) He goes on to say: “(So) the problem in the last few cycles as I see it is that we get promotors and insiders and people who have done very well cashing out as retail is buying.” Past bubbles and crashes Lets take a look at some of these past bubbles to see how they stack up to where we are today. What is widely considered to be the mother of all bubbles became known in history as tulip mania. It is one of the prime examples showcasing how irrational behaviour leads to asset prices rising to unsustainable levels before they finally collapse. In 1630 tulips which had only been introduced to Europe in the 1600's were starting to be perceived as special and rare. This prompted speculation in the tulip market shortly after leading prices to increase by 2000 % between November 1636 and February 1637 before plummeting by 99 % in May 1637. During this period of time some tulips were costing as much as a house clearly showcasing the disconnect from fundamental values and the greed and mania involved which are key characteristics of bubbles. One can't help but see the parallels in looking at prices that some digital or physical collectibles are commanding these days. Cryptopunk and Axie Infinity are just two examples of NFT's that can cost much more than even the most lavish of mansions. The most expensive crypto punk so far has been sold for 8 million dollars. The most expensive NFT so far Beeple’s, Everydays ” The First 5000 Days” sold for a staggering 69 million dollars. But also many physical collectibles are commanding hefty premiums with the most expensive Pokemon card having been sold for 369.000 dollars. Almost a bargain in comparison to some NFT'S. Well to be fair though at least when the price of NFT's approaches its fair value somewhere closer to zero you will always still be the proud owner of your virtual good whereas the tulip will not only have lost its value but have withered away completely. Japan In our modern time many speculative bubbles have been attributed to overly lax and stimulative financial policies of central banks. Japan's economic bubble of the 1980's is a prime example for this. After Japan entered a recession in 1986 the government countered with huge monetary and fiscal stimulus. The resulting free and abundend liquidity led to rampant speculation in the japanese stock and real estate market with prices increasing by 300 % between 1985 and 1989 and retail going all in. The bubble burst when the fiscal stimulus was withdrawn in 1991 ushering in what is now known as the lost decade due to slow economic growth and deflation. Today 30 years later the Japanese market is still trading below its 1991 highs. Dot com bubble In the 90s the internet was a rising star and with it many companies trying to commercialise its tremendous potential. Venture capitalists caught on early and in easy monetary conditions were throwing money at dot com startups. The public started catching on in 1995 and retail trading became more and more popular. Everybody was sure that there was nowhere but up for internet stocks no matter what they did or whether they even had revenues. In 1997 record amounts of capital flowed into the NASDAQ. New online brokers were making it more accessible for the average Joe to buy and sell shares and everybody was buying into the trade of a life time. At the height of the bubble their advertisements were showing that trading is an easy way to riches. Between 1995 and 2000 the NASDAQ rose by 500% from below 1000 to over 5000 points. When nobody was left to buy the bubble finally burst and the NASDAQ lost nearly 80%. At this point even blue-chip tech stocks like Intel were down by 80%. What followed was an extended bear market and a slow recovery. It should take until 2015 for markets to recover to previous levels. The dot com bubble actually spawned another bubble on its own as investors fleeing stocks piled into the real estate market. This became known as the US housing bubble which in the mid 2000s collapsed leading to a worldwide economic crisis today known as the great recession. To support the world economy during this time the central banks of the world started implementing quantitive easing basically increasing the money supply by lowering interest rates and purchasing assets in order to help the economy recover. At this point unprecedented amounts of money were newly created and injected into the economy. Shockingly this actually continued until 2018 when the US Fed started to taper its asset purchases which caused a liquidity crisis in the markets that after 10 years of a non stop FED powered rally were not prepared to come back to reality. As we have seen these bubbles develop and burst over and over again following the same pattern. The reason for this is that financial markets like the whole bubble dynamic are entirely driven by human psychology which is best illustrated in the different phases of bubble or market cycles. Where are we in the cycle Fast forward to today. We have been in a central bank induced bull market since we came out of the last recession in 2008. In 2020 COVID hit and as result the markets collapsed and millions of people lost their jobs as the world battled lockdowns that led to stores and factories closing. The worlds central banks jumped in swiftly - injecting more liquidity into the system than ever before. They cut interest rates to zero and started large asset purchase programs in addition to the government relief programs handing out money to everybody. Just between March and June 2020 the money supply in the US increased by 300 % the largest spike ever. 40 % of all dollars in existence were printed within the last 12 months. This flood of new free money quickly found its way into the stock markets since due to low interest rates lower risk assets are not yielding returns. Leaving investors no alternatives but to rotate to riskier higher yielding assets which today is known as TINA: there is no alternative. As we have seen earlier this flood of money combined with supply chain shortages caused by Covid lead to rampant price inflation throughout different asset classes within a short amount of time. It sure looks like we are in bubble territory but where are we within the cycle? One key characteristic of any bubble nearing its peak is the involvement of the general public or retail crowd. Therefor the degree to which retail investors play a part in the current boom cycle plays a key role in understanding where we are in the bubble. So what does the data tell us Retail participation in bubbles Since the beginning of the pandemic the amount of retail brokerage accounts opened has skyrocketed. Rxxbin Hxxd now has 18 million users almost doubling their amount of users before the pandemic started. They introduced fractional shares allowing you to start investing with as little as 1 dollar. Their advertising message is everybody is an investor and I guess in a bubble everybody is. The interest for trading has spiked online and offline. You know its getting sketchy when your little niece asks you for stock tips. But there is not only more retail trading the new traders are also younger and more inexperienced. A large part of todays market participants has never even seen a market correction of more than 10 % let alone a true recession. It is no surprise than that these investors are overly optimistic and can not believe the market can go anywhere but up. (It sure seems though that history is set to repeat and most of the retail crowd will be left holding the bag instead of taking home the tendies. As an old saying on wallstreet goes: “A man with money meets a man with experience. The man with the experience leaves with the money, while the man with money leaves with experience.”) The only thing more telling than the growing number of retail traders is the amount of money that has been flowing into the market. Over the last 25 years global equities had inflows of 727 billion USD cumulatively. Now hold on tight because this is truly crazy. Global equity inflows for 2021 annualized amount to 1.015 trillion USD. Yes thats right trillion not billion almost 300 billion more than have been flowing into the market over the last 25 years combined coming in in just one year. Over 80 % of these flows have gone into passive funds, ALL US, ALL LARGE CAP. At the same time margin debt has risen to historic highs as well. Market participants have never been this leveraged before. These days in the light of the FED support there is only one mantra driving the crowd: buy the tulip uhhh... dip. Crash scenario It seems then that retail is indeed all in or at least getting pretty close. Looking at these unprecedented huge inflows into equities and the retail trading frenzy it sure looks like we are in the last cycle of the bubble but how and when is it going to pop? There are currently many challenges ahead that might trigger a bigger correction or crash leading to these bubbles to burst. Lower vaccine efficacy and the spread of the delta variant are impacting supply chains putting more pressure on already elevated prices and slowing down the Chinese economy. The FED starting to taper into a slowing recovery might as well be a recipe for the crash that we have been waiting for. But whatever event is going to trigger the sell off every day margin debt is growing the resulting margin call avalanche that will ensue is getting bigger and bigger making sure that whatever correction we will see will not be a small one and might even trigger a recession. How to profit from this It sure seems like the central banks are running out of options and it will be very interesting to see how they respond to this. So when is this going to pop? It is very difficult to time market tops or bottoms due to the psychological nature of market cycles. As we have seen when looking at historic bubbles they can stretch on for years before they reach their peak. As they say on wallstreet: the market can stay irrational longer than you can stay solvent. In the past the yield curve has been a great leading indicator to detect a recession ahead. Of course there is no guarantee this will be predictive again but there is a good chance since ultimately it is down to smart investor behaviour. In any case watch out for the yield curve inverting as a warning signal. Nobody knows what event or chain of events will cause enough market participants to panic sell and trigger a crash. However being aware of these cycles and roughly what part of the cycle we are in allows you to manage your portfolio in a way that you can make money instead of loosing it. As promised lets look at how to do exactly that. Lets assume that your portfolio is already well diversified. Now your goal is to maximise your profits and minimise your risk therefor you want to have liquidity available to buy into a crash and at the same time protect your existing portfolio from losses. There are different ways to do this but my preferred way is to keep taking profits on a regular basis on all my positions. The resulting profits are partly held in cash or liquid inflation protected assets and the other part is used to build a position that is going long volatility. The current market has very low volatility. The only way is up and there are only minute corrections to the downside that are immediately bought up. This means the VIX a measurement for volatility is trading at relatively low levels. A big correction or crash in the overall market will lead the VIX to spike up. Thus going long volatility while buying the VIX with futures, options or ETF's earns our portfolio excellent protection from the crash. If you balance the VIX position and your portfolio out correctly you can easily cover all losses with the VIX position all the while being liquid enough to buy into the crash in order to profit from the recovery that inevitably will ensue.
TVC:VIX
by TradingPit
2
BTC BUBBLE EXPLAINED.Swayzepunkz is short on BTC/USD . This is what a bubble looks like. It started at the beginning of COVID and took off again in the $GME frenzy. Many players made this huge. However, bubbles pop, and people suffer. I believe this to be true with Crypto 110%. . As you can see, the bubble began the pop, about 49 days ago, and dropped a whopping 50%. . I know you’re all very excited about the money in crypto, but consider this bubble in your own due diligence as it’s a possibility. The lines you see are supports being hit after a massive drop. Roughly 36000 is where this symmetrical triangle ends which is in about 3 days. . This is a consolidation triangle which happens after large price movements and hits a level of general confidence. But we just need to look at the chart to know if this will recover. AND SWAYZEPUNKZ doesn’t think it will. . The next support is at 18,000, and a CONTINUATION wedge will do exactly that, as far as we are concerned. Always consider zooming out, as the macro scales will always determine the micro scales. Please comment below if you have questions. @cryptopatel
Short
by SwayzePunkz
6
What is the best hedge against stock market during Crash?In this chart you see TVC:SPX to TVC:GOLD ratio. It is crystal clear during the stock market bubble burst, Gold is the best place to store the value! In the past 2 Bubbles, the market corrected between 50-57%: According to the Warren Buffet indicator, this bubble is even bigger than the previous ones! on the other hand in the last 7 weeks we see a bullish trend in gold with a +11% gain and today it breaks above its bearish trend after 9 months. I think this presentation provides enough information to make a good decision..! how you handle it, depends on your art and technique of investment..!
TVC:SPX
by Moshkelgosha
2