Correlation, Or No?
Bitcoin goes through periods of being strongly correlated to the stock market, and is in one of these periods now. But fundamentally, Bitcoin is patently NOT correlated to the stock market. It's inversely correlated to the stock market over long periods, and to infinity.
Today, many many many believe the stock market is poised to crash, or in 2022 rebalance significantly, say + or - 50% to be on the conservative.
Where To From Here?
For now, Bitcoin is retracing and will dip significantly from today's $43k to under $20k, and possibly as low as $12k-$15k before it moons to new all-time-highs. But when it does, this next time it will moon even more quickly than ever before, and this next time will go past $200k.
At present, global monies are in a flight to safety, as many will wait for the potential Fed's interest rate debacle to play out. Also, the dollar's schema tells us it will continue to feed off of itself by printing more of itself.
So in the short-term, Wall Street will flow to more "sound" forms of a store of value (SoV), and of course these SoV's will be discovered as the greatest number of people choose what is the most valuable.😎
This process will continue in the mid-term while the Bitcoin market edges closer and closer to the next Bitcoin Halving in April, 2024. The next Bitcoin halving will halve its block reward from the present 6.25 BTC/block to 3.125 BTC/block. Since a new block is mined and added to the Bitcoin blockchain roughly every 10 minutes, this means that at Bitcoin's next halving, the supply rate of Bitcoin will reduce from 900 BTC p/day to 450 newly mined bitcoin added to its circulating supply each day.
Anticipation for this event will be so broad this time around that it'll likely lead to an earlier run-up in Bitcoin's price than we saw in the pre-halvings of 2012, 2016, and 2020. 2023 will be feverish, as a perfect storm of Bitcoin mania will form.
Bitcoin's a teenager this year, and up until now has enjoyed a reliable and reasonably predictable price pattern because of it's "halving" cycles and historical charting.
At present, Bitcoin's price predictability is more complex than in the past because of three factors:
1) A two-year Black Swan Event with its unpredictability (ahem!)
2) A dynamic change in its market due to the influx of massive institutional monies into Bitcoin since Q3 2020
3) A much broader awareness of Bitcoin's halving cycle, as Bitcoin has become the most widely held investment in recorded history, with likely more than 100,000,000 individual market participants reached during 2021
It's clear that #NumberGoUp, but how high and exactly when is anybody's guess.
A Propped Up Stock Market
It's also clear that more and more prognosticators see the stock market as no longer an indication of the U.S.S.A.'s economic health, but rather how propped up and overvalued the largest corporations are. In other words, their "valuations" are estimations as to how much more rich the "rich" are over the rest of America, which is seeing its middle-class being squeezed out of existence.
Who knows one single family with a house, two kids and a dog, a picket fence, with only one income-earner‽
The U.S.A.'s economy is at a tipping-point in 2022 for massive volatility. Four significant factors driving this volatility are:
1) Price Inflation. Recently released C.P.I. data reports historic year-over-year % hikes in price inflation. Plus, vastly growing numbers are realizing that true price inflation is waaay higher.
The global markets have signaled this reality clearly by downgrading corporate and sovereign credit ratings of those holding large currency reserves on their balance sheets.
This is further proved out by the recent 3+ year trend of historic gold-buying-binges by the largest central banks of the world.
Even further, since Q3 of 2020, there's been a meteoric rise of institutional investors and even sovereign wealth funds purchasing significant portfolio allocations of bitcoin for the first time in history. This of course, is because bitcoin is viewed by them as an asset and as digital gold.
2) The Transition To The Dollar CBDC. Wait, what? (CBDC = central bank digital currency.) Even if you've never heard of this before, or very little about it…it's coming…to a country near you. Absolutely, positively, for real. Whether or not a dollar CBDC becomes fully operational is yet to be seen but, it's on it's way here.
But what does this have to do with volatility in the financial markets for 2022? It's almost too simple. A transition into a dollar CBDC during a great market crash will be advertised as more inclusive, secure, efficient, faster, a simple way to pay your taxes, and how to take out all those money launderers, crack dealers, gun runners, and terrorists. But there will be no mention about how this makes every dollar a surveillance tool. Bye-bye privacy. As the dollar loses it's luster, this will be its “fix.”
A dollar CBDC's potential reality will drive a tidal wave of the plebs to exit the dollar to Cryptos so they can still buy a cup of coffee or a tank of gas without giving their longitude and latitude and timestamp and i.d. #.
3) Censorship. Verifiably active censorship of free speech by nation-state operatives is rising in the consciousness of the plebs globally. This sentiment is translating into the rocketing growth of decentralized social medias touting anti-cancel-culture platforms. These are havens for the alt cult, which is shrugging off the shackles of the dinosaurus bankasaurus industry, and going pro Bitcoin & Crypto.
4) Civil Discontent. There's an evident global great awakening due to social media technology, and the proliferation of multiple million person demonstrations in plethora countries. The plebs are opening up their media gaze to include waaay more than the major media outlets which are owned by a very few conglomerates.
The wider the net of media outlets, the greater the catch of solutions to choose from. And naturally, the plebs will choose for themselves what's best.
Wait for more dip? i know what i'm gonna do. But since i know nothing about your finances, this post is 100% my opinion and not your advice. i'm just some guy ranting on The Interwebs. But i hope this helps you with your financial choices. If so, 😎 you can help me for free by subscribing for free, and to my other medias linked below👇
Carry on, but watch out for the dip in the road. btw, he's harmless.
i wish you well, i wish you wealth, i wish you health, and until next time, Peace!
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