You can tell how strange the investment world is becoming by examining the price chart action recently in 3 different markets. We’re seeing the kind of movements and patterns you didn’t used to see everyday but which have come to pass for normal lately in most of the financial/business media.

Nouriel Roubini says Bitcoin is a modern-day tulip bulb mania-style phenomenon. That is, in his words, the price no longer has any relation to the reality of the underlying asset. Cryptocurrency enthusiasts reject the notion claiming that it’s a whole new world misunderstood by old school guys like Roubini.

This Forbes blog post from mid-December, 2020 shows that a move above the previous resistance of 14,000 would likely mean a breakout to higher levels. That level where, if buyers overwhelmed old sellers, price would be free to take off again. Looking back, it’s clear that new buyers were indeed ready to pile in.

The monthly Bitcoin price chart looks like this:

Once it crossed the previous resistance from late 2017 at 20,000, buyers have been unable to restrain themselves. You don’t find many monthly price charts with these kind of long, hollow candlesticks.

Next: how the price of Hecla Mining moved before, during and following an attempted short squeeze. Some traders thought they could do to silver (and silver stocks like $HL) what Reddit folks did to GameStop a few days earlier. As you can see by this daily chart, it didn’t quite work out for most participants.

That spike up came on a Monday following a weekend of Twitter hype where “#SilverSqueeze” became a trending topic. Note how quickly the price gapped up and then gapped down to return to old levels. This is the type of move you might see with a false one-hour, then denied, buyout rumor. It’s a rare, longish type of abandoned baby doji to put it in candlestick terms.

Yet, some traders had been primed for it on social media. Many stocks involved in metals and mining had this kind of a look for that week. It almost felt like an experiment to see how much and how fast money could be made using Redditt Wall Street Bets-style tactics.

Finally, here is the monthly chart of the Pro Shares Ultrashort Financials ETF.

It’s designed to benefit from drops in the prices of bank stocks and related financial institutions. The designed-by-derivatives fund makes it possible to amplify gains (or losses) by a factor of 3. Some sophisticated traders use this for intraday-only trading. Some do not.

In a sense, this is the upside-down version of the Bitcoin chart. Incredibly hot and heavily traded back in 2009 and today it’s widely ignored and avoided. A price of the fund near 9000 back in that year now trades for a measly 12.70. They call it the boom/bust cycle because boom seems to have a way of tracking toward bust.

I do not hold positions in these investments. No recommendations are made one way or the other.  If you’re an investor, you’d want to look much deeper into each of these situations. You can lose money trading or investing in stocks and other instruments. Always do your own independent research, due diligence and seek professional advice from a licensed investment advisor.

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