As January comes to a close, the main stock indices plod on, Bitcoin starts to correct, and we start seeing extreme action on some lesser-known counters.
We also conducted a market poll to see what our readers think.
Market Poll on S&P 500 & Bitcoin
Last week, we conducted a market poll on our Telegram channel (https://t.me/synapsetrading), and here are the results!
About 2/3 of those polled are bullish on the stock market, expecting the S&P 500 to make new highs.
In a similar vein, about 1/2 of those polled think that Bitcoin will make new highs.
Historically, the crowd is usually wrong, so let’s see how these predictions turn out! 😄
Let’s take a look at the general market trends:
The stock indices (NASUSD, SPXUSD, R2000USD) and the Pound (GBP) are all very bullish, whereas the Euro (EUR) and US dollar (USD) are very bearish.
Profit-taking on Bitcoin
In last week’s blog post, I warned people that the parabolic move of Bitcoin to $40,000 was not sustainable, and a correction was due.
Bitcoin has corrected about 30% from its recent highs, and now remains rangebound.
I will monitor for an opportune moment to enter.
GameStop (GME) Saga – What Exactly Happened?
As a business, GameStop, which primarily sells video games and gaming consoles, has been on a slow decline for some time.
That is why many large funds have huge short positions on this stock, giving it one of the highest short interest.
The r/WallStreetBets community on Reddit, which has more than 2 million subscribers, decided to come together to buy up the stock and push up its price.
As the price of the stock increased, this caused more funds to close their short positions (by buying the stock), thus further pushing up prices.
This is called a short squeeze, and it can cause prices to spike up.
Here is the daily chart:
And here is the 15-minute chart:
Elon musk also joined in the fun:
The GameStop stock jumped more than 60% after hours as Elon Musk tweets out the Reddit board that’s the hyping stock.
I wonder how this will end. 🤡
Stay tuned for next week!