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Ewan

Member
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4,525
If you believe the pundit that thinks a Bitcoin will be $500 in 3 years time, tuck in today while it’s “only” £40. On the other hand, if you believe it’s as unstable as Musk, go more steady. A punt on Bitcoin might turn out very well indeed, but it’s just that - a punt. I don’t see the genuine economic science behind the investment, it’s just a gamble based on even more people jumping on the train behind you.
Remember, loads of people got in to Bitcoin at £15 or so, only to bail out at £5. As with (virtually) all investments, up is not the only way.
 

allandwf

Centenary Club
Messages
9,493
Well I'm worried now. Just seen etoro adverts on the TV, usually in my opinion this bodes badly. I've been using this for a few years and it manages keeps me in pin, (wine,) money lol. I can normally make around 4k a year just muddling around with a 1k pot. Too scared to play big stakes. Time to leave?
 

breezer

Member
Messages
155
Well my brother took a punt on Bitcoin in 2017 and invested £20k and bought 7 Bitcoins. At today's price they are now worth £274k!! I asked him are you going to cash them in to which he said, "no this is a 10 year investment". Jesus, I would have taken the money now...However, some pundits are suggesting that Bitcoin could go to $500k per coin in the next 2-3 years.
There are several Crypto's you should be keeping a close eye on....it may turn 'traditional' investing on its head. Watch this space.
It’s hard to say this when the current evidence is thst “everyone is making money” but I really do think crypto as an asset class is utterly pointless and nobody has yet been able to give me a reason for it to exist.

That said, in a bubbly market environment like we are in at present there’s minimal harm in apportioning a small part of one’s portfolio to pyramid schemes (sorry, crypto) and other bizarre schemes. If nothing else this provides a bit of an option on participating in the bubble and helps reduce FOMO.

But to invest more than 1% or so into these things is crazy and will likely end in tears. It has all the hallmarks of a classic investment bubble.

Disclosure: I have followed this advice (but much more conservatively than 1% of my portfolio!) and bet (note: not invested) a TINY (sub-£1k) position in Monero, which seems to have about the only use I can find - being private enough that nobody (read: tax and drug authorities) can see who holds what. Unlike BTC which people believe is private but isn’t.

I thus believe it’s the closest to useful of any coin, yet has a smaller market cap than DOGE coin, which, as the inventor has repeatedly said, is literally a joke/meme coin he set up (DOGE = Doggy) and not a real currency. But in this market nobody listens.
 
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CatmanV2

Member
Messages
38,563
IME the entire block chain thing (of which Bitcoin is something of an exemplar) is a solution looking desperately for a solution, and has been for years.

Yes there are lots of places where people say it could be used, data integrity, ledgers and audits but to the best of my knowledge no one is actually using it in large scale deployments. Happy to be corrected but I know none of the FCA companies that I've worked with are using it.

C
 

Froddy

Member
Messages
696
Well I'm worried now. Just seen etoro adverts on the TV, usually in my opinion this bodes badly. I've been using this for a few years and it manages keeps me in pin, (wine,) money lol. I can normally make around 4k a year just muddling around with a 1k pot. Too scared to play big stakes. Time to leave?
Brilliant, allandwf - love that!

Aside from the adverts, there are many reasons to be cautious as there are red flags everywhere, and this cat must surely be running out of lives.

The trouble is that the Fed's actions have skewed the market to such an extent that price discovery has been destroyed, and exuberance promoted. This chart of M1 money flow (basically the Fed's money printing) tells it all:

82195

When that money supply is cut back, there will be big trouble.

There are other red flags. Bond yields are rising and have just poked their head above where they were in March 2020 (10 year yield below):
82198

And the S&P weekly chart is at +2ATR (the uppermost wavy blue line) away from the mean (the thick purple line). Price ALWAYS reverts to the mean:
82199

Big Money is worried too as the SKEW index reading is above 135, indicating that they are hedging.

As regards Bitcoin, on any view it is over-extended - I can't even measure how may ATRs above the mean it is. It will revert, it's just a matter of time. There is classic bearish divergence showing on the RSI (relative strength index) reading:

82200

That does NOT mean that a reversal is imminent - just that the red flags are there.

My personal view is that the markets are running up a tightrope; we only need one gust of wind (in the form of bad news) to topple them. Alternatively, we just need one last, big exuberant push (a "blow off top") to trigger the selling. If/when the S&P hits 4,000 points, a nice round number, how will the markets react?

Will the Fed just print more to maintain the bubble?

Who knows!
 

D Walker

Centenary Club
Messages
9,252
Well I'm worried now. Just seen etoro adverts on the TV, usually in my opinion this bodes badly. I've been using this for a few years and it manages keeps me in pin, (wine,) money lol. I can normally make around 4k a year just muddling around with a 1k pot. Too scared to play big stakes. Time to leave?
What’s your handle on etoro then, I’ll follow you, as I’d like 4K a year to spend on wine.... :)
 

allandwf

Centenary Club
Messages
9,493
What’s your handle on etoro then, I’ll follow you, as I’d like 4K a year to spend on wine.... :)
Oils mostly, doubled my money on MRO, up 33% on BP and 14% up on USO at the moment. As with everything might not make much if anything this year, but has been good to me so far. Not lost anything since I started , and I know nothing other than I've worked through three Oil price crashes.
 

Wattie

Member
Messages
6,907
Brilliant, allandwf - love that!

Aside from the adverts, there are many reasons to be cautious as there are red flags everywhere, and this cat must surely be running out of lives.

The trouble is that the Fed's actions have skewed the market to such an extent that price discovery has been destroyed, and exuberance promoted. This chart of M1 money flow (basically the Fed's money printing) tells it all:

View attachment 82195

When that money supply is cut back, there will be big trouble.

There are other red flags. Bond yields are rising and have just poked their head above where they were in March 2020 (10 year yield below):
View attachment 82198

And the S&P weekly chart is at +2ATR (the uppermost wavy blue line) away from the mean (the thick purple line). Price ALWAYS reverts to the mean:
View attachment 82199

Big Money is worried too as the SKEW index reading is above 135, indicating that they are hedging.

As regards Bitcoin, on any view it is over-extended - I can't even measure how may ATRs above the mean it is. It will revert, it's just a matter of time. There is classic bearish divergence showing on the RSI (relative strength index) reading:

View attachment 82200

That does NOT mean that a reversal is imminent - just that the red flags are there.

My personal view is that the markets are running up a tightrope; we only need one gust of wind (in the form of bad news) to topple them. Alternatively, we just need one last, big exuberant push (a "blow off top") to trigger the selling. If/when the S&P hits 4,000 points, a nice round number, how will the markets react?

Will the Fed just print more to maintain the bubble?

Who knows!
Ponzi scheme.
 

rockits

Member
Messages
8,398
I've had a very good year and a very bad year for different reasons. I still think the markets have further to go yet but will be aiming to leave the party early.

The PF's I started and have worked hard at since mid March 2020 are about 320% up so doing OK so far.

Navigating through, around, under, over this one has been interesting. So many normal rules don't apply any more as the rules have changed. So much has come into play that never has before.

If anyone says they know what will happen.....they are lying. Nobody knows. We just make our best guess and take a shot. Hopefully it works out OK. It at. east not too badly!
 

allandwf

Centenary Club
Messages
9,493
I've had a very good year and a very bad year for different reasons. I still think the markets have further to go yet but will be aiming to leave the party early.

The PF's I started and have worked hard at since mid March 2020 are about 320% up so doing OK so far.

Navigating through, around, under, over this one has been interesting. So many normal rules don't apply any more as the rules have changed. So much has come into play that never has before.

If anyone says they know what will happen.....they are lying. Nobody knows. We just make our best guess and take a shot. Hopefully it works out OK. It at. east not too badly!
As Steve Miller said, Go on take the money and run. :)
 

Silvercat

Member
Messages
1,134
If you believe the pundit that thinks a Bitcoin will be $500 in 3 years time, tuck in today while it’s “only” £40. On the other hand, if you believe it’s as unstable as Musk, go more steady. A punt on Bitcoin might turn out very well indeed, but it’s just that - a punt. I don’t see the genuine economic science behind the investment, it’s just a gamble based on even more people jumping on the train behind you.
Remember, loads of people got in to Bitcoin at £15 or so, only to bail out at £5. As with (virtually) all investments, up is not the only way.
Well my brother is now sitting pretty so what a punt! Good on him for having the balls to have a go 4 years ago.
( PS But he was the FD for a big Bank in the City for a while so his background may have helped).
;)
 

Silvercat

Member
Messages
1,134
It’s hard to say this when the current evidence is thst “everyone is making money” but I really do think crypto as an asset class is utterly pointless and nobody has yet been able to give me a reason for it to exist.

That said, in a bubbly market environment like we are in at present there’s minimal harm in apportioning a small part of one’s portfolio to pyramid schemes (sorry, crypto) and other bizarre schemes. If nothing else this provides a bit of an option on participating in the bubble and helps reduce FOMO.

But to invest more than 1% or so into these things is crazy and will likely end in tears. It has all the hallmarks of a classic investment bubble.

Disclosure: I have followed this advice (but much more conservatively than 1% of my portfolio!) and bet (note: not invested) a TINY (sub-£1k) position in Monero, which seems to have about the only use I can find - being private enough that nobody (read: tax and drug authorities) can see who holds what. Unlike BTC which people believe is private but isn’t.

I thus believe it’s the closest to useful of any coin, yet has a smaller market cap than DOGE coin, which, as the inventor has repeatedly said, is literally a joke/meme coin he set up (DOGE = Doggy) and not a real currency. But in this market nobody listens.
An interesting read...
An article from someone I read on a daily basis...this one on bitcoin, of which he is definitely an expert: "Bitcoin’s price explosion has the industry asking key questions…
"Bitcoin’s price has exploded over 400% since early October – quintupling in less than five months. As a result, its market capitalization (market cap) has eclipsed $1 trillion for the first time ever.
Market cap refers to the total dollar market value of an asset. In bitcoin’s case, we can roughly think of it as how many dollars are “parked” in bitcoin at any given time.
To put this in perspective, bitcoin’s market cap was just below $200 billion early in October. Yet Visa, MasterCard, JPMorgan Chase, PayPal, and Bank of America had market caps of $430 billion, $343 billion, $304 billion, $228 billion, and $216 billion, respectively, at that time.
In other words, bitcoin was still considerably less valuable than America’s top banks and credit card companies.
Fast forward to today, and it is a completely different story. Bitcoin is more than twice as valuable as each of these companies.
The blockchain community has long anticipated the $1 trillion market cap benchmark as a major milestone for bitcoin. That’s the level at which the community believed institutional adoption would occur.
Silicon Valley insider Jeff Brown says… “If I had to bet my life on one tech investment, this would be it…”
And that’s exactly what has happened.
As we have discussed several times recently, traditional firms are now allocating a portion of their treasury to bitcoin. And the legacy credit card companies are enabling merchants to accept the digital asset as payment.
That said, most in the industry didn’t expect bitcoin to move this far so fast. That’s got the blockchain community buzzing. People are trying to explain what’s going on right now… and they’re forecasting whether or not it will continue.
Some say that this is just a speculative mania. They say that low interest rates are forcing the big firms to “reach for yield” with more speculative assets because they can’t get a meaningful return on conservative assets like bonds.
Others say that the institutions are adopting bitcoin as a store of value and a defense against inflation. They liken it to digital gold because its supply is mathematically limited. Only 21 million bitcoins will ever exist.
I think what happens in the coming months will answer these questions. And I’m watching two specific items closely…
First, I want to see if governments around the world increase their efforts to inhibit or ban bitcoin and cryptocurrencies. It’s no secret that some governments see bitcoin as a direct threat to their own currencies. Will they act on this? And if so, will they be effective?
I am also very interested to see what happens with bitcoin when inflation increases. And make no mistake about it – inflation is going to surge.
The U.S. government has been furiously printing money since February of last year.
According to the Federal Reserve’s own data, $3.4 trillion have been generated from thin air since February 26. That’s largely in response to the economic lockdowns and other foolish policies enacted in response to COVID-19.
And now we are talking about another $1.9 trillion stimulus package to boot. (I recently put together a presentation about the financial “great reset” I see coming as a result of these events. Go right here to learn more.)
Any time we see trillions of dollars being created from nothing at all, we are going to see inflation. It may take longer than we expect for it to show up in our daily cost of living, but there’s no doubt inflation is coming.
How will bitcoin behave when that happens? Will investors and institutions flock to it as a safe haven? Or will they flee it for what they consider more conservative assets? That will be telling.
As for me, I remain long-term bullish on bitcoin. But I think it is overdue for a correction in the short term. What we are seeing right now is pure speculation, and it won’t end well for some."
 

Ewan

Member
Messages
4,525
Well my brother is now sitting pretty so what a punt! Good on him for having the balls to have a go 4 years ago.
( PS But he was the FD for a big Bank in the City for a while so his background may have helped).
;)
I see its dropped about 15% since I commented a few ago about it being a punt. Does that make me as influential as Musk!? ;)
 

Silvercat

Member
Messages
1,134
I see its dropped about 15% since I commented a few ago about it being a punt. Does that make me as influential as Musk!? ;)
Probably....it rises and falls by the hour and considerably so but if Musk has put $1.5bn into Bitcoin then maybe he's on to something which may just be going places....up.
:mock8:
 

Ewan

Member
Messages
4,525
What goes up, may well continue to do so. But might not.
I obviously have absolutely no idea what will happen with Bitcoin from here, it’s an investment I don’t understand, and that’s the only reason it’s not for me. Braver people than I can take that risk.
 

Wattie

Member
Messages
6,907
Yields rising, inflationary should signs are everywhere (check out commodity prices, property etc), terrible US bond auction.
The Fed has no choice but to buy even more- QE to the moon and yield curve control will be here soon or the Ponzi collapses.

This is going to end very badly for us all.
 

Froddy

Member
Messages
696
Yields rising, inflationary should signs are everywhere (check out commodity prices, property etc), terrible US bond auction.
The Fed has no choice but to buy even more- QE to the moon and yield curve control will be here soon or the Ponzi collapses.

This is going to end very badly for us all.
Yes, everybody’s needs to be on high alert, and be prepared for “Margin Call Monday” if we have another selling day tomorrow.

“Buy the dip” is over for now - be prepared to “sell the rip” instead!

And watch that US$ index (DXY) - if that begins to rip with a collapsing bond market, we’re really in trouble ...
 
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