We broke out of the rising wedge a couple of
weeks ago and we will have to wait if we can
break back into the rising wedge. A head and shoulders could be forming on the chart.
•Almost every
indicator suggests that we are overvalued.
94% correlation between the Nasdaq 100 in the 15 years to today, and the 15 years to 2000. The S&P500 shows a 95% correlation.
shiller PE ratio is at 38.49 on the day of writing this. The mean is at 16.88 and the median is at 15.86. This means that we are 128% overvalued.
The warren buffet indicator is telling us that we are strongly overvalued. We are currently at 213%. The exponential trendline
suggests that a Market Value to
GDP ratio of 120% to be
fairly valued.
long term trendline warren buffet indicator:
We are 71% higher then the long-term trend line.
•We printed a ton of money during the
COVID-19 period. When we had the 2020
march crash, the stock market recoved
insanely fast, even when the economy was
falling. The recovery happened because we
printed so much money to support the
company's (not because the businesses were
performing great.
1 million+ people dead? No
problem the market goes up 30%.
Millions of people getting unemployed in the
US and the rest of the world? Not a problem,
the market goes up another 30%. Almost
every business was experiencing massive
losses while their stock price was
skyrocketing.
•The inflation of the USD is at its highest point since the 90s (also higher then in 2008) (5.4% at the moment)
•evergrande is already starting to miss their
payments. They have missed 3 payments so far. When
evergrande defaults, the everything bubble
could definitely burst. A gigantic flash sell will
happen when Evergrande defaults.
Evergrande still has to pay 305 billion USD.
They haven't even paid of 1% of their debt.
So who are the biggest bagholders of the
$305B in bad bonds? -->
There are several American and Canadian
banks that Evergrande ows money to:
First we've got the Royale Bank of Canada
which has $46B in evergrande bonds with a
market cap of $144B.
If you were wondering why there was that
weird after hours - the stock dropped 64%
during AH in one day, but then they fixed the
"glitch" and the price went back up.
RBC looked worthless and this was just the
real view of the bank's financial state when
the bonds hit zero.
•A lot of people think that China will help evergrande but most of the bagholders are in the US or Canada so why would China help them?
•canadian tv reminding people that bank
deposits are ensured. (The Royale Bank of Canada made this advertisement as well)
•billionaire investors have a lot of cash on
their hands.
•Michael Burry and a ton of other famous investors predict that the markets will collapse.
•palantir warns people of a black swan event.
energy crisis in China and Europe
•historic records amount of margin.
•Eliotte waves suggest that a big crash is
going to happen.
•October 25th looks really bad and could very well be the date the crash is going to start.
We can easily go down 35-50% to big support
levels but I don't think these support levels are going to hold a crash like this.This crash could be a very big one. 75% or more is not even unrealistic at this point. We messed up so now its time to pay for our mistakes...
Conclusion: the TA looks bad and so does
everything going in the world right now. If this
ends up happening it will be a fantastic
buying opportunity. The S&p500 could go 20%
higher to arround $5000, but a crash is
inevitable. If it doesn't happen this year, then it
will probably happen in the next 2 years. And
do you really want to risk a 20% return when
the market could fall 50% or more? You can
cash out now and buy back 2x the amount of
the shares after the crash. And get 2x the
amount of shares that you could buy now.
weeks ago and we will have to wait if we can
break back into the rising wedge. A head and shoulders could be forming on the chart.
•Almost every
indicator suggests that we are overvalued.
94% correlation between the Nasdaq 100 in the 15 years to today, and the 15 years to 2000. The S&P500 shows a 95% correlation.
shiller PE ratio is at 38.49 on the day of writing this. The mean is at 16.88 and the median is at 15.86. This means that we are 128% overvalued.
The warren buffet indicator is telling us that we are strongly overvalued. We are currently at 213%. The exponential trendline
suggests that a Market Value to
GDP ratio of 120% to be
fairly valued.
long term trendline warren buffet indicator:
We are 71% higher then the long-term trend line.
•We printed a ton of money during the
COVID-19 period. When we had the 2020
march crash, the stock market recoved
insanely fast, even when the economy was
falling. The recovery happened because we
printed so much money to support the
company's (not because the businesses were
performing great.
1 million+ people dead? No
problem the market goes up 30%.
Millions of people getting unemployed in the
US and the rest of the world? Not a problem,
the market goes up another 30%. Almost
every business was experiencing massive
losses while their stock price was
skyrocketing.
•The inflation of the USD is at its highest point since the 90s (also higher then in 2008) (5.4% at the moment)
•evergrande is already starting to miss their
payments. They have missed 3 payments so far. When
evergrande defaults, the everything bubble
could definitely burst. A gigantic flash sell will
happen when Evergrande defaults.
Evergrande still has to pay 305 billion USD.
They haven't even paid of 1% of their debt.
So who are the biggest bagholders of the
$305B in bad bonds? -->
There are several American and Canadian
banks that Evergrande ows money to:
First we've got the Royale Bank of Canada
which has $46B in evergrande bonds with a
market cap of $144B.
If you were wondering why there was that
weird after hours - the stock dropped 64%
during AH in one day, but then they fixed the
"glitch" and the price went back up.
RBC looked worthless and this was just the
real view of the bank's financial state when
the bonds hit zero.
•A lot of people think that China will help evergrande but most of the bagholders are in the US or Canada so why would China help them?
•canadian tv reminding people that bank
deposits are ensured. (The Royale Bank of Canada made this advertisement as well)
•billionaire investors have a lot of cash on
their hands.
•Michael Burry and a ton of other famous investors predict that the markets will collapse.
•palantir warns people of a black swan event.
energy crisis in China and Europe
•historic records amount of margin.
•Eliotte waves suggest that a big crash is
going to happen.
•October 25th looks really bad and could very well be the date the crash is going to start.
We can easily go down 35-50% to big support
levels but I don't think these support levels are going to hold a crash like this.This crash could be a very big one. 75% or more is not even unrealistic at this point. We messed up so now its time to pay for our mistakes...
Conclusion: the TA looks bad and so does
everything going in the world right now. If this
ends up happening it will be a fantastic
buying opportunity. The S&p500 could go 20%
higher to arround $5000, but a crash is
inevitable. If it doesn't happen this year, then it
will probably happen in the next 2 years. And
do you really want to risk a 20% return when
the market could fall 50% or more? You can
cash out now and buy back 2x the amount of
the shares after the crash. And get 2x the
amount of shares that you could buy now.