Cliff jumping is jumping off a cliff as a form of sport. When done without equipment, it may be also known as tombstoning.
I may not be the best person to talk about this sport when we have world-class athletes on the platform, but let's see my observation about the markets' situation in the past 3 weeks and see if it has any similarities with Cliff jumping!
To eliminate the noise I use monthly charts:
NFLX:
AMZN:
AMD:
NVDA:
Disney:
SHOP:
PYPL:
BABA:
PTON:
COIN:
ADBE:
CRM:
MRNA:
RBLX:
SQ:
LRCX:
NOW:
SBUX:
AFRM:
UPST:
ROKU:
SNAP:
TWTR:
PINS:
OKTA:
NKE:
CRWD:
BLK:
PLTR:
RIVN:
DOCU:
TOTAL:
Bitcoin:
Ethereum:
After these 35 examples, you should have no doubt about what we are dealing with in the Tech sector!
While everyone is waiting for important financial data and interest rates this week, I think the market has already jumped off the cliff because of the fear of QT (Quantitative Tightening) and the possibility of rate hikes!
The big question is if markets have a parachute, is it working? and how would be the landing?
In the past 3 weeks, Big names like Apple, Microsoft, Google, Amazon, and Tesla have shown resistance but what would happen if they join the jumpers?
In the past month, 89.5% of stocks traded had negative returns!
Reviewing my 2022 forecast:
1-The Energy and Banks sector could continue their rally in January 2022..!
2-Tech stocks especially those which still burn cash, will experience a hard time in 2022, and any positive must be considered as transitory!
3-Small caps may experience lower prices and even Negative returns in 2022.
4-SPX, NDX, and DJI could have 10-15% returns in 2022.
5-Keep in mind that 12 monthly rates of change decreased by half in the past 10 months for SPX , NDX, and DJI which means expected market ROI should be lower in 2022 in comparison to 2021 and 2020!
6-For small caps this phenomenon is even worse, they lost 85% of their gains, and continuation of this phenomenon could lead to a negative return in 2022. ( Fundamentals also support depreciation of unprofitable business in high inflation era)
7- 2022 will be the year for those who know how to handle high volatility! A year for aggressive portfolio management strategies!
I will provide updates for this analysis as needed.
Best, Moshkelgosha
DISCLAIMER
I’m not a certified financial planner/advisor, a certified financial analyst, an economist, a CPA , an accountant, or a lawyer. I’m not a finance professional through formal education. The contents on this site are for informational purposes only and do not constitute financial, accounting, or legal advice. I can’t promise that the information shared on my posts is appropriate for you or anyone else. By using this site, you agree to hold me harmless from any ramifications, financial or otherwise, that occur to you as a result of acting on information found on this site.
It was pleasure to read first paragraph which is related to climbers,I agree with you about all observations you made.I am expecting 13800 to have support for NDX but not sure they can hold at that level.
@ButterDickinson, As you saw yesterday, NDX bounced from level of 13720 which is almost 13800 but i don't think it will work under these circumstances.(FED,Ukraine - Russia crisis)
So.... what you're saying is there's blood in the streets?! Hmmm.....
Don't forget the biotech ETF XBI. It's a whole sector that's down huge, not just a single security. 50% off of it's high from this past year.
rb675
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Have a good night
digital_precision
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Ford can afford to freefall for a loooooong ways and investors will still be way ahead. F has gone up 553% from the Mar 2020 covid crash to it's all time high. Even now, it's up 351% since then. 351% in less than 2 years? That's called BLING BLING! With that being said, what goes up must come down and I fully expect F to continue a slide for quite some time as people continue to take profits.
@Moshkelgosha, Ford went from being WAY undervalued to being WAY overvalued. This is the very nature of bubbles and the humans who are the cause of them. Markets never know when they've gone far enough until they've gone too far. In this case, way too far. People got caught up in the Electric Vehicle craze similar to a mini Dot.com craze. We bestowed enormous, unwarranted valuations on the likes of Rivian and others who are years and years away from being profitable, if ever. Ford was very, very late to the party so once they finally said "Hey, me too!" to the EV market people blindly piled in. And for any of you actually reading this - NEVER get into a trade without an exit strategy that is etched in stone, not a line in the sand. Drawing stop loss levels with pencil is stupid, and that's how you get trapped into trades as they continue to fall off the face of the earth.
Draw your stop losses in PEN. Better yet, get a permanent marker! Don't change it for any reason as you near it, self-talking all the way to convince yourself that it's just about to bounce and if you just stay in a LITTLE LONGER you'll ride it all the way back up to the high. Get out before you're one of Moshkelgosha's little red cookie cutter guys about to be disemboweled.