MUST watch videos

I watch quite a few videos, George Gammon does a great job of breaking down financial forces and keeps it entertaining.   I recommend watching all the videos he has on this list here:  

This video explains the situation America is in, it should start at 18:00.  IF it doesn't skip to that time.

This video does an EXCELLENT view of the forward next 3-10 years.  I don't agree with all conclusions for market valuation targets, as people will react.

The Central Banks will try to capitalize on the crypto revolution and put out their own.  Bitcoin valuations will take a massive hit, but from the ashes I think Bitcoin as a value store will prevail.

Market Cracking on target

 Finally, FINALLY the markets are going to revert back to true value.  As I posted in December "Resuming the March decline Ahead" on December 2nd, I gave at most 3 months until the last bull blowoff ends when I emailed friends.  We are close to the 3 month mark, and the downturn has finally started.

Over the last year we have kept the bull running, but I FINALLY think the top is in for a while, potentially years.  Why? Because as I posted in "Resuming the March Decline Ahead"  President Trump pressed every last easy button  to get "the worlds strongest economy" in January 2020 with a 1 trillion a year deficit.   There is no easy road ahead, which will not play well with stocks.

The bond market is losing control, now the FED and the US government has to convince the world we won't continue the reckless finance.   Its going to be a hard cell.

How do I know I am wrong? Its simple, if the S&P 500 closes a mere 4% higher then I am wrong.  We need a closing print above 3,951.  If I send this to you, I recommend you dump it all, and on a closing print for a solid week (to avoid a fake new bull), and buy back.  If not cash is best.  Since bonds rates have gone up, you can buy bonds ASAP and hold watching your bonds rise in value as the bond market reverses.

So how far does this market fall?  It of course, like everything in life depends on the actions of countries and institutions.  However using history as a guide, and all easy buttons pressed,  I think a 50% cut is in our future in the years ahead before a final bottom.  Some of the Hedge fund manager I respect target as much as 80%.  Although this should happen, I don't think it will.  The governments and the FED will do anything to stop that from happening.

Given what I said above, calculate 33% loss as the target.  Why? As I posted on January 25th "I am tapping out", the leverage using loans to buy equities is at materially higher all time highs.  Quite a bit of this leverage is being used by Millennials who have not experienced a bear market.   Many will get squeezed out with margin calls with forced losses, and this will cause a cascade problem.

I am not convinced another 2008 crash is in the cards, but I do think a trend change of new lower lowers in the year ahead is here.  One of the reasons NOT for a 2008 crash is the new free money the Democrats will give to people.  Many will gamble in the market, and the best way to take that money is to have a long drawn out loss.

I think there will be many reversals in the months ahead, as most will think we are going to resume a bull.

So for short term trading, you can buy into the markets at S&P 500 of:

3700 - around the previous dip level.

3600 - around first Fibonacci level, 
3300 - strong resistance due to past market action.

After that its pretty murky, next major level is March 2020 level of 2200.  I'd expect a minimum bottom around 1900.  We would need a capitulation moment, and going lower than March 2020 would do it.

What about Bitcoin? Unfortunately I think it cannot escape the deflationary downturn.  The exception could be once again , the Millennials.  At some point, they will give up on the market (SPX 22000 break?) and just buy Bitcoin in disgust for a buy and hold.

Since Bitcoin is a pure wildcard, its harder to say how low it may go.  I am looking for a low of 22,000, maybe piercing 20,000 in a day.  Thats my level to rebuy.

What tells me I am wrong? A new bitcoin high for more than 1 full day.  I will start to get optimistic at Bitcoin over a day at 53K.

When this market route ends, I will be looking to buy into India, Bitcoin, some gold miners, global index funds, emerging market funds, and a little bit of a US ETF (TBD which).

The markets may resume the rally, but we are close to a terminating end with the borrowing and debt.

Good luck!

If you want to learn more, learn about the bond market, although its not in favor, it drives everything in USA as a debtor nation.  Here is a good video:

https://youtu.be/fNwd-UuE3Dg

BitCoin Charts

 Chart of last 6 months, notice once Bitcoin broke the first red trend line on Feb 22nd, it went down quickly.

Zooming in since Jan 22nd, when I went suddenly bearish in post "I am tapping out", we can see over night it violated 46k briefly over night. (orange into green area)  we also broke slightly lower than the Feb 23rd low.  If we go through the 45K then next target is 42k-38K for support.  If we violate 38k, then we can return to 32K, from Jan 22nd.

A material print above 53K starts to turn me bullish, and a new high is obviously bullish.

When investing, think, when can the big money make more money from the small guy?  When the small guy is piled up onto the same side of a trade.

Dont get trapped, but also if we bottom, also get brave.  My target is 26-22K, but at 29K I may start to add or if we go above 53K.   The stock market is weak, and I expect to go much lower, all assets usually get pulled with it.

NASDAQ at a critical level

 I am very unsure if the top is in, once democrats give free money to 'everyone', my concern is that free money makes it way to gambling in the market.

With that said, it could also be the good news was built in, so the markets will fall as the 'free money' enters, meaning, they catch the downside. 

In any event, today the NASDAQ is at a critical level, on a market CLOSING basis.  Breaking intra-day doesnt count.

The support line below dates back to Biden getting elected.

Downside of a market pullback is 10-30% before a counter rally ensues.  We could very well bounce today and kick this to a future retest.

Parabolic blow off?

 It looks like we may be entering into a historic parabolic blowoff.  The stock market indexes made new highs, and the futures look promising for more advancement.

Therefore it is likely we will continue to see various parabolic gains on a variety of fronts.

I am going to put my $ into these items and yes, I am going nervously bullish.

But the charts don't lie, we are going up, until it doesn't.

if DJI breaks below 30,000 or SPX breaks below 3890 on a closing basis, that raises alarms that all bets are off.

The overall market is not yet in solid 100% bull mode, but its pretty close to it.

Areas I'll deploy in are:

GBTC - I have a bit already, not sure if I'll add from here.

ETHE - Ethereum I won't go in as heavy as bitcoin, it promises higher % return in the short term.

AGC (2x etf at 52) or SLV (at 25) - Silver buying continues at a record pace, inventories are expected to be exhausted soon.  if there is continued buying, the silver shorts are notorious, and we may have another GameStop situation here.

Silver is at 30, and 45 is the all time high, i have to believe a 50% gain is in the future.

MJ - the sector is hot, individual stocks will do better, but I can't afford to get cut in half overnight.

If I want to go short, the ETF of choice for me is DOG, simply because the loss over time is much lower than other options.

I am not buying more GDX/GDXJ, GOLD, but not going to zero either,   Bitcoin is the new gold, I am only doing silver due to the heavy purchasing.

I am going to minimize picking individual stocks, simply because when this cracks, a random stock could get cut in half over night.

The ETF's will have a milder hit.

If this parabolic blow off gains steam this all ends very badly, but its all a game of chicken now.

Good luck!!