Because of the Fed's retarded policies and politics over the last few years, we live in a bizarro world where stocks are actually inversely correlated to the health of the economy. If the economy starts to even nominally recover, stocks actually sell off. Speculators in the stock market know that the entire thing is overvalued, and they are prepared to pull out the second that the Fed stops printing free money, lending it out for next to free, and requiring banks actually hold money.
Congress recently announced capital controls on banks, and the Fed announced numbers that point to economic recovery. That's the reason you see the selloff. Market participants actually believe this shit, and they are driving up bond yields. When bond yields go up, stock prices go down. If the Fed doesn't purposefully drive down these bond yields, then stocks continue to go down.
And of course, crypto moves with stocks. Somehow. Whatever. I don't make the rules.
If you listened to the recent Fed meeting though, Money Printer Powell is doing everything he can to tell market participants that everything is not ok. This is even as he announces numbers that would ultimately signal a recovery and make him look good. It's a tight line. Powell, as the only real arbiter of his success, wants to cover his own ass by telling everyone his policies worked. But he knows they're not working. So right after he announces positive numbers in unemployment, housing prices, blah blah, he turns right around and says some retarded shit like, "we have a long way to go."
"We have a long way to go" means "I'm stalling." Dig a little deeper and actually, you'll see Powell tries to tell the truth, however. He masks it behind financial lingo, saying that the increase in business will only cause a temporary rise in spending/inflation. He tries to hint to market participants that they don't really need to be drinking the kool-aid he just spiked with his fudgy unemployment numbers. They don't listen. So we get a sell off in stocks because these market participants actually believe in the recovery in our bizarro world where recovery means sell-off.
The crypto space currently acts like a really techy tech stock. So what we're about to see is a small deleveraging in the riskiest stuff, namely the NASDAQ and crypto. I'm responding by selling some of my ether to buy back later at a lower price and to increase my leverage ratio in my defi banks.
Whether this drop for bitcoin and ether will jumpstart another alt season or drag down the market remains to be seen. I don't know. That's something you have to react to, not try to predict. But buying good alts is a decent bet right now. If bitcoin escapes the market's gravity well, alts will take off. If bitcoin goes sideways, alts will take off. Even if bitcoin can hold a downward slope that's not steep, alts are ready to take off.
The crypto market mostly had this right in February, saying that March and April might be rocky. Most people were saying it would be because of a temporary rise in the strength of the dollar. That's kind of accurate. Dollar strength will increase with increased bond yields. That is, until the Fed lowers those yields because it doesn't want to see what happens if it doesn't (street riots and other forms of social unrest).
Crypto's also safe long term because bond yields, even the temporarily heightened ones we see now, still don't outpace inflation. They're being bought up by idiots who still believe in the US system and don't really understand that they're losing money. But the Fed knows. And they know this loss of capital will eventually lead to some bad stuff, like old people being unable to afford medicine and health care, pensions defaulting, etc.
We've also got tax season coming up in the US. You can bet that a lot of idiots will be selling top crypto assets to (over)pay tax bills. More Boomer retardation. Bottom line is the top assets in crypto may be in for a rocky road. That doesn't mean altcoin season is cancelled; play that by ear. And if Ethereum actually gets it shit together and does something about these fees, it could reinvigorate things. But these are the reasons that everything is happening as it is. Prepare accordingly.
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Gems I'm investing in:
NFTs - Doki Doki
Gaming - Abyss
100X Gem - YieldGoat
