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.
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### 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.
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### 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.
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### 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.
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### 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.
Dotcombubble
Market Psychology: Why the Wall St. Cheat Sheet Still WorksI decided to apply the Wall Street Cheat Sheet to a chart of the S&P 500 during the Dotcom crash. It is impressive that it still works and holds so many lessons.
The question you should ask yourself is, where are we now?
Let me know your thoughts in the comments below.
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Understanding the implications of the Wall Street Cheat Sheet can be crucial for investors and traders looking to navigate the markets more effectively. It serves as a reminder of the recurring nature of market sentiment, highlighting that investor psychology tends to repeat itself in a cyclical pattern.
Recognizing these patterns can help traders anticipate market movements and improve their decision-making processes. Although it's not a fail-proof guide to predicting market trends, the Wall Street Cheat Sheet is a tool that, when combined with other strategies and risk assessments, can provide insightful context to market indicators and behavior.
The Wall Street Cheat Sheet encapsulates the variety of emotions investors go through during market cycles. Recognizing emotional cycles can inform risk assessment and trading strategies.
The Wall Street Cheat Sheet serves as a roadmap for navigating the emotional highs and lows investors face during market cycles. Each phase reflects a collective sentiment that can influence financial markets and, subsequently, the price movement of stocks.
Market cycles represent the recurrent fluctuations seen in the financial markets and can be identified through the price movements of stocks. These cycles are driven by a variety of factors such as economic indicators, corporate performance, and investor sentiment.
The Wall Street Cheat Sheet encapsulates the typical emotional journey of investors through the different stages of a market cycle. The following phases are included:
Hope: A period when optimism starts to grow, and investment decisions are made with the anticipation of future gains.
Optimism: The phase where confidence continues to build, often leading to increased investments.
Belief: This stage marks a commitment to the bullish trend, with many investors convinced of their strategy.
Thrill: Investors experience a high, often accompanied by a sense of triumph.
Euphoria: The peak of the cycle, where maximum financial risk is actually present but overlooked due to extreme optimism.
Complacency: After reaching peaks, the sense of euphoria shifts to a state of denial once the market begins to turn.
Anxiety: As market correction sets in, anxiety starts to replace complacency.
Denial: Investors hold onto hope that the market will bounce back quickly, failing to acknowledge changing trends.
Fear: Acknowledgment of losses sets in, and panic may ensue.
Desperation: A feeling of helplessness might prevail, with investors looking for a way out.
Panic: Rapid selling occurs, trying to exit positions to avoid further losses.
Capitulation: Investors give up any previous optimism, often selling at a loss.
Anger: The reality of financial impact hits, and investors question their decisions.
Depression: Coming to terms with the financial hit and reflecting on the decisions made.
Disbelief: Skepticism prevails even as the market may begin recovery, with many wary of another downturn.
BITCOIN TF 1M LOOKS BEAUTIFULMy Point of View about Bitcoin still Same. I looks a Bubbles Condition at TF 1M, I saw a Double Top Pattern Which mean Price can be Drop significantly. Please use a free money for buy a bitcoin or another altcoins. I Believe Bitcoin will Hit 100K$ it just a matter of time. At this moment we must follow the news from US about Inflation. THE FED still Hawkish about USD. Stock, Crypto will be suffering again.
REMEMBER !
" NEVER INVEST MONEY THAT YOU CAN AFFORD TO LOSE "
Thats All For me Cheers :)
We’ve been here before. 2000’s Nasdaq vs Today.The Nasdaq's formidable recovery from the October 2022 bottom resulted in an impressive 42% surge, a rare feat for a major index. However, as it grapples with resistance at the 15250 level this past week, we are compelled to question if this upward momentum is running out of steam. Notably, historical instances where the Relative Strength Index (RSI) soared past the 70 level have often been followed by a downward shift for the index.
We diligently monitor the Nasdaq's ratio against other major indices to gauge its relative value. At its current level, the Nasdaq seems to be trading at a premium compared to several other major indices.
When we consider this ratio, the Nasdaq appears to be near its all-time highs. In fact, it's trading close to or above the levels seen during the dot-com bubble of the 2000s in all comparisons. When juxtaposed with the S&P and Dow, we find that this level is not unprecedented; each time the ratio has previously reached this level, it was swiftly corrected.
Drawing a parallel between the economic conditions of the 2000s and now, it seems that we are in familiar territory, or as they say, ‘we’ve been here before’.
To illustrate the similarities, let's consider the dot-com peak in March 2000 as a reference point.
The current economic indicators closely mirror those from the 2000s, as reflected in measures such as Dollar strength, inflation, unemployment, and interest rates. In particular, the US 2Y-10Y spread indicates an inversion of the yield curve that surpasses even the extent seen during the 2000s. Simultaneously, the other indicators nearly align with their respective levels from that period.
This begs the question: What has been propelling the Nasdaq higher? Could it be the hype surrounding AI and technology, or is it the liquidity in the market?
We posit that it's a combination of both factors, as the tech rally and increased reserve balance seem to coincide with the ratio’s upward movement. Although we don't foresee a tech bubble bursting as it did in the 2000s, there's undeniable enthusiasm for the Nasdaq. Given the current setup's striking resemblance to the 2000s, we can glean lessons from that period to position ourselves optimally.
One potential strategy could be to short the Nasdaq 100 Futures on CME outright at the current level of 15086, with the take profit at 13900 and a stop loss at 15600. Alternatively, investors expressing a bearish view on the Nasdaq 100 ratio could consider shorting 2 Nasdaq 100 Futures and going long on 3 S&P500 Futures.
In the second setup, the dollar value of the position is equal, as the contract value of the Nasdaq 100 Futures and the S&P500 Futures is approximately the same, at roughly 600,000 USD for the full-sized contract at the current price level for both index. The same setup can be replicated using the micro Nasdaq 100 and S&P500 futures at the same ratio, where the position value is now roughly 60,000 USD.
For each 1 point move in the standard size E-MINI S&P 500 Futures contract, the equivalent value is 50 USD and 5 USD for the Micro contract. Similarly, each 1 point move in the standard-sized E-MINI Nasdaq 100 Futures contract equates to 20 USD, and 2 USD for the micro contract.
Trading this spread could potentially benefit from a margin offset of up to 70%, meaning that the capital required to initiate this trade is significantly reduced. This setup could be particularly attractive for traders seeking to optimize their capital usage while gaining exposure to these major indices.
The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. 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
Disclaimer:
The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description.
Reference:
www.cmegroup.com
www.cmegroup.com
www.cmegroup.com
www.cmegroup.com
DXY to crash soon?Please read entire description!
Bearish Wolfe waves forming inside an ascending wedge on the daily timeframe charts of the dollar currency index.
We have entered the monthly resistance band of the ascending parallel channel on the monthly charts and we have reached the top of a channel that we have been trading inside on the daily chart. We are approaching the top formed right before the "dotcom" bubble burst causing all markets to crash (late 90's - early 00's) as well.
I think a decent correction is overdue especially with The Federal Reserve hiking interest rates steadily and with CPI (and inflation rates) reaching high numbers that haven't been seen for over 40 years.
I don't think is it really possible to pinpoint the top for this run but we are certainly getting closer imo.
We could start the downtrend from the top of the daily channel, monthly channel, or reach all the way to the top of the dotcom crash (which relatively isn't too far away).
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Monthly chart channel (resistance band marked in red):
Daily chart channel:
The bigger picture (daily support levels marked in teal):
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Thoughts and opinions appreciated.
Crypto as a MarketHello Birdies,
After a long time I did some fractal analysis and this time its between dotCom bubble and Crypto Market.
The fractals are pretty clear and yesterday we post Crypto MCap idea which also pointing towards 957B-997B area. Which is exactly where we are standing in fractals right now.
I am just waiting for the drawdown to buy BTC and enjoy the last bull ride before SUPER CRASH
DJI - God Help Us All... Welcome to the Great depression 2022 Dow Jones industrial average index has lost its February 2020 support. As this support did not hold i am convinced that the oldest US index has begun the great depression, not recession but depression. You can already see what fiat pairs with the USD are doing.
The run up was just phenomenal to say the least. We've been essentially parabolic since 2009, with the total run up since 1987 flash crash. Since then economy was on steroids.
The first sign of realism came with the dot.com bubble. It was especially hard on the S&P 500 index which lost more than 80% back then. Then came 2008 financial crisis which was seen predominant in the DJI. After that it was just up up up, sideways and up.
Covid dump just showed how laveraged this market is and sparked asset inflation on steroids. .... NOW ... Will see what happens.
DJI could still drop by 1k points, but not much lower for now as it is expected to go into a retracement first, if it doesn't go already. This retracement could drag out for year or two before continuation down. Where you might think?... below 2008 bottom is quite realistic, but for that it can take 10-30 years to play out. Again its a depression not recession, remember that. We are clearly not dropping like in the 1929-1932, therefore i think we will bleed slower.
Aftermath could be ... who knows... 20-30% of people out of job.... in 1930s there were around 25-30% of them on the streets.
During DJI retracement there could still be a rotation in the stock and crypto market, with little projects reaching new ATHs, but still lets not expect to much, and rather realize that the US economy has POPPED.
DISCLAMER:
I am not a financial advisor so non of this should be taken as a financial advise. Be well.
TVC:DJI
The 5 Crashes That Shook The Markets.A very brief look at 5 of the most significant market crashes to date, using the Dow Jones Index.
Content taken from various online sources.
Great Crash 1929
Many factors likely contributed to the collapse of the stock market. Among the more prominent causes were the period of rampant speculation (those who had bought stocks on margin not only lost the value of their investment, they also owed money to the entities that had granted the loans for the stock purchases), tightening of credit by the Federal Reserve,
the proliferation of holding companies and investment trusts (which tended to create debt), a multitude of large bank loans that could not be liquidated, and an economic recession that had begun earlier in the summer.
During the mid- to late 1920s, the stock market in the United States underwent rapid expansion. It continued for the first six months following President Herbert Hoover’s inauguration in January 1929.
The prices of stocks soared to fantastic heights in the great “Hoover bull market,” and the public, from banking and industrial magnates to chauffeurs and cooks, rushed to brokers to invest their liquid assets or their savings in securities, which they could sell at a profit.
Billions of dollars were drawn from the banks into Wall Street for brokers’ loans to carry margin accounts. The stock market stubbornly kept on climbing. That is, until October 1929, when it all came tumbling down.
Catching on to the market's overheated situation, seasoned investors began "taking profits" in the autumn of 1929. Share prices started to stutter.
They first crash on Oct. 24, 1929, markets opened 11% lower than the previous day. After this "Black Thursday," they rallied briefly. But prices fell again the following Monday. Many investors couldn't make their margin calls.
Wholesale panic set in, leading to more selling. On "Black Tuesday," Oct. 29, investors unloaded millions of shares — and kept on unloading. There were literally no buyers.
The rapid decline in U.S. stocks contributed to the Great Depression of the 1930s.
The Great Depression lasted approximately 10 years and affected both industrialized and non industrialized countries in many parts of the world.
When Franklin D. Roosevelt became President in 1933, he almost immediately started pushing through Congress a series of programs and projects called the New Deal. How much the New Deal actually alleviated the depression is a matter of some debate — throughout the decade, production remained low and unemployment high.
But the New Deal did more than attempt to stabilize the economy, provide relief to jobless Americans and create previously unheard of safety net programs, as well as regulate the private sector. It also reshaped the role of government, with programs that are now part of the fabric of American society.
Black Monday 1987
Many market analysts theorize that the Black Monday crash of 1987 was largely driven simply by a strong bull market that was overdue for a major correction.
1987 marked the fifth year of a major bull market that had not experienced a single major corrective retracement of prices since its inception in 1982. Stock prices had more than tripled in value in the previous four and a half years, rising by 44% in 1987 alone, prior to the Black Monday crash.
The other culprit pinpointed as contributing to the severe crash was computerized trading. Computer, or “program trading,” was still relatively new to the markets in the mid-1980s.
The use of computers enabled brokers to place larger orders and implement trades more quickly. In addition, the software programs developed by banks, brokerages, and other firms were set to automatically execute stop-loss orders, selling out positions, if stocks dropped by a certain percentage.
On Black Monday, the computerized trading systems created a domino effect, continually accelerating the pace of selling as the market dropped, thus causing it to drop even further. The avalanche of selling that was triggered by the initial losses resulted in stock prices dropping even further, which in turn triggered more rounds of computer-driven selling.
A third factor in the crash was “portfolio insurance,” which, like computerized trading, was a relatively new phenomenon at the time. Portfolio insurance involved large institutional investors partially hedging their stock portfolios by taking short positions in S&P 500 futures. The portfolio insurance strategies were designed to automatically increase their short futures positions if there was a significant decline in stock prices.
On Black Monday, the practice triggered the same domino effect as the computerized trading programs. As stock prices declined, large investors sold short more S&P 500 futures contracts. The downward pressure in the futures market put additional selling pressure on the stock market.
In short, the stock market dropped, which caused increased short selling in the futures market, which caused more investors to sell stocks, which caused more investors to short sell stock futures.
A key consequence of the Black Monday crash was the development and implementation of “circuit breakers.” In the aftermath of the 1987 crash, stock exchanges worldwide implemented “circuit breakers” that temporarily halt trading when major stock indices decline by a specified percentage.
For example, as of 2019, if the S&P 500 Index falls by more than 7% from the previous day’s closing price, it trips the first circuit breaker, which halts all stock trading for 15 minutes. The second circuit breaker is triggered if there is a 13% drop in the index from the previous close, and if the third circuit breaker level is triggered – by a 20% decline – then trading is halted for the remainder of the day.
The purpose of the circuit breaker system is to try to avoid a market panic where investors just start recklessly selling out all their holdings. It’s widely believed that such a general panic is to blame for much of the severity of the Black Monday crash.
The temporary halts in trading that occur under the circuit breaker system are designed to give investors a space to catch their breath and, hopefully, take the time to make rational trading decisions, thereby avoiding a blind panic of stock selling.
The Federal Reserve responded to the crash in four distinct ways: (1) issuing a public statement promising to provide liquidity, as needed, “to support the economic and financial system”; (2) providing support to the Treasury securities market by injecting in-high-demand maturities into the market via reverse repurchase agreements; (3) allowing the federal funds rate to fall from 7.5% to 7.0% and below; and (4) intervening directly to allow the rescue of the largest options clearing firm in Chicago.
Dotcom Bubble 2000
The dotcom crash was triggered by the rise and fall of technology stocks. The growth of the Internet created a buzz among investors, who were quick to pour money into start-up companies.
These companies were able to raise enough money to go public without a business plan, product, or track record of profits. These companies quickly ran through their cash, which caused them to go under.
The Internet bubble, grew out of a combination of the presence of speculative or fad-based investing, the abundance of venture capital funding for start-ups, and the failure of dotcoms to turn a profit.
Investors poured money into Internet start-ups during the 1990s hoping they would one day become profitable. Many investors and venture capitalists abandoned a cautious approach for fear of not being able to cash in on the growing use of the Internet.
With capital markets throwing money at the sector, start-ups were in a race to quickly get big. Companies without any proprietary technology abandoned fiscal responsibility. They spent a fortune on marketing to establish brands that would set them apart from the competition. Some start-ups spent as much as 90% of their budget on advertising.
Record amounts of capital started flowing into the Nasdaq in 1997. By 1999, 39% of all venture capital investments were going to Internet companies. That year, most of the 457 initial public offerings (IPOs) were related to Internet companies, followed by 91 in the first quarter of 2000 alone.
The high-water mark was the AOL Time Warner megamerger in January 2000, which became the biggest merger failure in history.
As investment capital began to dry up, so did the lifeblood of cash-strapped dotcom companies. Dotcom companies that reached market capitalizations in the hundreds of millions of dollars became worthless within a matter of months. By the end of 2001, a majority of publicly-traded dotcom companies folded, and trillions of dollars of investment capital evaporated.
The bubble ultimately burst, leaving many investors facing steep losses and several Internet companies going bust. Companies that famously survived the bubble include Amazon, eBay, and Priceline.
The US government would date the start of the dot-com recession as beginning in March 2001. And by the time of the economic shock from the terrorist attacks of September 11, 2001, there was no longer any doubt. In that tragic month of September, for the first time in 26 years, not a single IPO came to market. The dot-com era was over.
Global Financial Crisis 2008-2009
The crisis, often referred to as “The Great Recession,” didn’t happen overnight. There were many factors present leading up to the crisis, and their effects linger to this day.
The foundation of the global financial crisis was built on the back of the housing market bubble that began to form in 2007. Banks and lending institutions offered low interest rates on mortgages and encouraged many homeowners to take out loans that they couldn’t afford.
With all the mortgages flooding in, lenders created new financial instruments called mortgage-backed securities (MBS), which were essentially mortgages bundled together that could then be sold as securities with minimal risk load due to the fact that they were backed by credit default swaps (CDS). Lenders could then easily pass along the mortgages – and all the risk.
Outdated regulations that weren’t rigorously enforced allowed lenders to get sloppy with underwriting, meaning the actual value of the securities couldn’t be established or guaranteed.
Banks began to lend recklessly to families and individuals without true means to follow through on the mortgages they’d been granted. Such high-risk (subprime) loans were then inevitably bundled together and passed down the line.
As the subprime mortgage bundles grew in number to an overwhelming degree, with a large percentage moving into default, lending institutions began to face financial difficulties. It led to the dismal financial conditions around the world during the 2008-2009 period and continued for years to come.
Financial stresses peaked following the failure of the US financial firm Lehman Brothers in September 2008. Together with the failure or near failure of a range of other financial firms around that time, this triggered a panic in financial markets globally.
Many who took out subprime mortgages eventually defaulted. When they could not pay, financial institutions took major hits. The government, however, stepped in to bail out banks.
The housing market was deeply impacted by the crisis. Evictions and foreclosures began within months. The stock market, in response, began to plummet and major businesses worldwide began to fail, losing millions. This, of course, resulted in widespread layoffs and extended periods of unemployment worldwide.
Declining credit availability and failing confidence in financial stability led to fewer and more cautious investments, and international trade slowed to a crawl.
Eventually, the United States responded to the crisis by passing the American Recovery and Reinvestment Act of 2009, which used an expansionary monetary policy, facilitated bank bailouts and mergers, and worked towards stimulating economic growth.
Covid Crash 2020
The 2020 crash occurred because investors were worried about the impact of the COVID-19 coronavirus pandemic.
The uncertainty over the danger of the virus, plus the shuttering of many businesses and industries as states implemented shutdown orders, damaged many sectors of the economy.
Investors predicted that workers would be laid off, resulting in high unemployment and decreased purchasing power.
On March 11, the World Health Organization (WHO) declared the disease a pandemic. The organization was concerned that government leaders weren't doing enough to stop the rapidly spreading virus.
Investors had also been jittery ever since President Donald Trump launched trade wars with China and other countries.
Under both the Trump and Biden administrations, the federal government passed multiple bills to stimulate the economy. These included help directed at specific sectors, cash payments to taxpayers, increases in unemployment insurance, and rental assistance.
These measures further soothed investors, leading to additional gains in the stock market. Investors were also encouraged by the development and distribution of multiple COVID-19 vaccines, which began under the Trump administration.
The driving forces behind the stock market crash of 2020 were unprecedented. However, investor confidence remained high, propelled by a combination of federal stimulus and vaccine development.
2000 vs 2022Some similarities between 2000 vs 2022
1. Before reaching ATH the index did a very sharp decline of 33%
2. It took the index 17 bars to reach an ATH vs 20 now
3. Found support on 40SMA after 9 months from ATH vs 7 now
4. Mass retail participation
5. .com mania vs crypto mania? (did luna just popped the bubble?)
6. Interest rates were falling back in 2000 vs rising now (tradingeconomics.com)
7. Inflation was not even close back then to what is is now (tradingeconomics.com)
What to wait for
1. Holding or not 40SMA!!!
2. Where RSI, MACD & DMI will head towards next months
3. The index went -18.35% lower than the previous big decline which equals Nasdaq declining just above where the previous wave ended
4. It took the index 23 months by the time it touched for the first time the 40SMA to bottom which means April 2024 just 6 months before the elections
When the bubble burst in 2000 nobody really blamed the "system" like in 09 simply because everybody participated in it. It's like blaming yourself! How many people have the courage to do that? Could the same be told about the current situation? Yes, governments printed trillion of money but they did not put a gun in your head telling you, it's either you invest in crypto/stock market or you are done. We participated because our friends and family did, we participated because we were greedy, we participated because we believed in a fairytale and we participated because we wanted an"exit" from the system but all we did was feed the system!
I cannot really find any really strong arguments to support that the same will not happen again in the not-so-distant future. I am only thinking that if it is that obvious maybe the markets can stay irrational longer than we can stay solvent!
I stand by the Tradinview's motto LOOK FIRST/THEN LEAP
Only Some Will Survive !!!History repeating itself as bitcoin is clearly resembling the patterns from the 2008 dot com bubble. I personally believe that the total crypto market cap will come down to the 500-600 billion range and many Alts will get absolutely reckt!!!
Not a financial advise, not a financial advisor either :))
Using the Keltner and Gaussian Channels to prepare for another NTLDR:
If we see the NASDAQ enter the Gaussian Channel or NDX/SPX enters the Gaussian Channel it is a time to start looking for long term investments. If you see something you like (and maybe that includes giving you dividends) you would buy the base of the keltner channel.
Analysis
I think Have done a good job of putting the information on the main chart in an easy to understand way. One thing I have tinkered on in the past but am not going to detail in this post is how I often see a lot of curious price action occur within important wicks or candle bodies. You cannot always guarantee what kind of price action that you will get in one of these wicks. After all, they could be continuation or reversal. Either way, if you are doing this analysis on a monthly chart or something similar you might be looking for a pattern to develop on that time frame. And if you are on a monthly chart looking for at monthly candle sticks to make a pattern that can take years to develop. Another thing I am not digging into is other indicators looking for bearish divergence. They are there, but I am kinda time bound right now.
A look at the weekly chart of NQ1!/SPXUSD shows after price went above the last monthly wick of NDX/SPX that price formed a double top and price is right at the valley low. Sure, they may be a bounce, for some odd reason, but I am not betting on it. I use the NASDAQ Futures versus SPXUSD because that gets me the most time based data but the inclusion of SPXUSD prohibits me from using any volume analysis, but that is fine for some pure charting technical analysis. I use the fib tar getting on that is pretty solid and while price may zigzag down on NDX/SPX the target shows that NDX is going to take a slagging compared to SPX. If you are familiar with your US indices, then you know generally that NDX is going to take the biggest hit, then SPX, then DJI.
If this is similar to the dot Com bubble pop then Gold should be looking pretty good. And after Gold looks good, silver and the other precious metals should get a run. Here is a look at NDX and Gold. We might be in a decades long bull run of Gold against NDX.
A look at GoldFutures/NDX seems to have a lot of bullishness in the monthly chart with your classic bullish divergence on the monthly.
Gold versus Ethereum also looks very bullish divergence on the MACD and the Stoch picking up.
What I am doing (for now)
My crypto account is either in Tether, PAXG, or taking shorts. My normie employer restrictive retiremnet fund is poised for interest rates to rise. My own trading account is building a portfolio around precious metals and miners.
Repeat of the 2000 dot-com bubble? Some dubious speculation...I took the bar pattern of the 2000 bubble pop and subsequent bear market and copied it to the present day to see what it would look like.
I did adjust the shape a little to make the H&S look more symmetrical, just like the H&S in 2000.
You can see it fits rather well.
- The RSI is topping and expected to trend lower.
- The bottom of the breakdown lines up with the market top in 2000 and 2008.
- It bottoms at the lower support of the megaphone pattern.
- Finally, the length of the move is proportional to the one in 2000.
Despite how 'perfectly' it all fits, extrapolating 2 years out to find the bottom is dubious speculation. It goes without saying, but it most likely will not go down like this.
Disclaimer: I am not bearish nor am I bullish. I don't hold a macro outlook. I simply react to what the market tells me. This was just a fun hypothetical.
The 2022 Tech Bubble Fractals and Sentiment AnalysisIntroduction
I was inspired by CryptoKaleo's post (original post below) on the "Next Tech Bubble", where he predicted a tech bubble to take place in the coming years based on the fractals of the 1998-2002 Dot com bubble market price action.
Disclaimer: This is not investment advice. This is for educational and entertainment purposes only. I am not responsible for the profits or loss generated from your investments. Trade and invest at your own risk.
Analysis
I myself have been also thinking about the probability of another 2000-esque bull rally for the Nasdaq index for a while now.
You can check out my analysis on the comparison between the market in 2020 and the Dot com bubble, which I posted last year:
My goal for this post was to not only compare the price action of the two periods through fractals, but also to research the headlines of financial news from the past, in order to more accurately research the sentiment that was reflected on the media. The quotes in red are direct quotes from 1998-2002, and the quotes in black are recent news that reflect the current market sentiment.
We can see a clear shift in sentiment; optimism > euphoria > fear > surrender.
The most notable parts of the cycle is the euphoria at the absolute top of the market, and sense of despair at the bottom of the market.
This figure will further help you understand the structure of a market bubble, and the market sentiment according to the price action of the market.
What's extremely interesting is that the Dot com bubble demonstrated a textbook pattern of a market bubble structure.
Conclusion
There may be multiple news that could potentially trigger the next market bubble. If one were to occur, it's highly likely that we see it happen in the tech/bio sector this time, where insane multiples are given based not on the current financials of the company, but the prospect of it. While there is also a probable case where we don't see a bubble at all, if it we were to see the market make parabolic moves up to overbought levels, referring to fractals of the past, and comparing the market sentiment of the past, could provide a guideline for us to refer to.
If you like this analysis, please make sure to like the post, and follow for more quality content!
I would also appreciate it if you could leave a comment below with some original insight.
bear case s&palways good to contradict ourselves for perspective sake. this is a a possible bear case scenario if the capital S really hits the fan with the coming eviction news and corona variants mixed in with more lockdowns or other new black swan. the govt is low on dry powder for stimulus and protections. many of you might agree the downtrend is overdue. this is all for fun not financial advice.
2021-05-29 DJIA Birdseye view 1929 till 2021Sometimes one needs to take a step back to see the bigger picture on what is going, to learn from the past and start making plans of actions on what to do next ✌
1929 Crash (Wikipedia article)
en.wikipedia.org
1987 Black Monday Crash (Wikipedia article)
en.wikipedia.org(1987)
1999-2000 Dot-Com Bubble (Wikipedia article)
en.wikipedia.org
2007-2008 Subprime Mortgage Crisis (Wikipedia article)
en.wikipedia.org
TESLA in 2020 vs APPLE in 2000, what if..I tried to compare the 2020 Telsa bull run vs apple during the dot com crisis
what if we are in an EV bubble that is comparable to the dot bubble?
could we predict how it will go this time?
as we saw in 2000, the internet was intended to become a great thing, but not yet.
what if the EV is intended to become a great thing, but not today? maybe in 20 years from now?
I suggest you look for other stocks related to EV, green energy, and all the trendis right now, and by comparing those with the FAANG in the dot com bubble.
CSCO Bubble PatternFollowed a common 5 phase pattern
Phase 1: Trending breakout of basing formation in a strong up-trending move
Phase 2: Trending high-volatility drawdown (usually not related to stock or index itself).
Phase 3: Trending recovery - stock or index shrugs off the high volatility event as it recovers quickly and stronger than before.
Phase 4: Upwards & & sideways non-trending consolidation. Typically choppy trading, but slightly upward move.
Phase 5: 3 Phase blowoff top - breakout of non-trending consolidation followed by a smaller upwards consolidation into final blowoff breakout top.