Capitulation. Flight to quality will go right into crypto.
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I shorted the S&P instead and made a 12% return on that position today, protecting my long positions.
Bitcoin is down 12% today with no sign of stopping it's movement downwards, and all crypto prices are tied to bitcoin.
Traders more conservative than myself moved into bonds today. Other traders chose gold. Very few chose cryptocurrencies.
Friday before last I moved 70% out of stocks and bought PUTs in July as insurance on the rest. However, as my history has shown me - one doesnt assume this makes them smart. Could just have been lucky, this time.
I like to think that you can't time the market, but you get lucky sometimes.
> However, as my history has shown me - one doesnt assume this makes them smart.
No doubt. In my case, I still need to close out my short position so I'm only halfway there.
When did you short S&P? Was it because you saw it starting to go down, or did you have some way of telling ahead of time this was going to happen?
Around noon, there were 2 days of losses in a row going into Monday and the S&P was moving down after being up slightly at the start. I figured it'd be another losing day with possible losses continuing into the week, so I made a move.
The move in crypto is tied to the move in the markets.
The SP500 has much more to fall yet.
I think it has always been a reasonable assumption that a fall in the real economy would cause cryptos to fall. Play money gets liquidated first when real money (in 401k and stocks) evaporates. And the lack of liquidity in cryptos would cause it to fall faster.
Bitcoin dropped from a $19k all time high to around 6.5k recently. Most other cryptocurrency are doing about the same.
Then why aren't we seeing a parallel run-up in cryptocurrency?
Wait until the 14th
Why would people selling stocks now hold cash until the 14th, and only then move into cryptocurrency?
In market conditions like this maybe you've heard that some subscribe to the financial maxim that "cash is king".
Sure, the maxim exists. What I'm interested in is the reasoning beyond the suggestion that the 14th is a magic date on which money that has moved to from stocks (and, in point of fact, cryptocurrency!) to cash for stability will suddenly decide, en masse, to move into cryptocurrency because “quality”.
Bitcoin is on a far bigger nosedive. Why would anyone want to buy now?
Because people might think this is (close to) the bottom.
They're fleeing into bonds.
That’s a bad idea. Yields can’t exactly go much lower.
"The yield on 10-year U.S. Treasury debt hit a four-year high of 2.885 percent, having jumped almost 7 basis points on Friday."
https://www.nasdaq.com/article/wall-st-opens-lower-on-rising...
Tax cut stimulus + already stimulated economy = inflation.
Inflation concerns = higher bond yields.
Higher bond yields = people dumping stocks for bonds.
People dumping stocks for bonds would increase the price of bonds, pushing yields lower.
Inflation is higher than 2.885%. Anyone buying bonds now is A) causing yields to drop B) still losing money to inflation.
> Inflation is higher than 2.885%
Official BLS has had it at a 2.0% annual rate for the first half of 2017 and a 1.7% for the second; some citation would be welcome on the claim that it's jumped to something above a 2.885% annual rate since...
Sorry, inflation in the price of things people actually want to buy. The government has every incentive to lie about real inflation.
> Sorry, inflation in the price of things people actually want to buy
And still, actual evidence that the rate of inflation “in the price of things people want to buy” is 2.885% or higher is missing.
Trying to blur the topic is not a substitute for supporting your fact claims.
No, it isn't. Inflation hasn't event hit 2% (Fed goal) yet.
https://www.thebalance.com/current-u-s-inflation-rate-statis...
It's better to hold onto your money than to lose it.
+2 beats -12.
As more people flee to bonds the price rises, sending yields even lower. Also, inflation is higher than 2%, so you’re still losing money. Bitcoin is the only safehaven in times like these, the market just hasn’t realized it yet.
>Bitcoin is the only safehaven in times like these, the market just hasn’t realized it yet.
So it doesn't work?
Can we stop calling these cryptocurrencies "crypto"? That shorthand belongs to the people developing cryptographic encryption technologies.
Words don't belong to anyone unless you register a trademark or some equivalent. People refer to cryptocurrency far more frequently than cryptographic algorithms lately; it's inevitable that they would start appropriating the shorthand word.
I think most people stopped caring a month ago, this stupid name is going to stay.
You are correct, but that battle is lost.
cryto = cryptocurrency now... the masses say so.
You can start using the full term "cryptographic encryption" instead.
Gatekeeping detected.
Please don't do this here.
Is your issue specifically that I posted a link to urban dictionary or that I posted an accusation of gatekeeping?
The GP comment was already off topic and predictable—in the sense that it gets repeated all the time these day—but your response was further off topic, borderline uncivil because of the accusation aspect, and the internet trope thing is definitely not something to practice on HN. I understand the temptation to post these things, but it's a temptation that needs to be resisted if we're to have higher-quality discussion here.