Wednesday, January 22, 2020

Waiting For Tech Super Implosion

The only stocks making new highs in Trumptopia are the ones Trump hates the most...

The MAGA fantasy bubble is leveraged to the dumb money index bubble. The dumb money bubble is leveraged to the Y2K 2.0 Tech Super Bubble. The Tech Super Bubble is leveraged to end of cycle short covering.

In other words, the entire world of denial is now massively leveraged to Tesla. By FAR the best performing large cap stock in Trumptopia, is the largest manufacturer of electric cars. You can't make this shit up...

Semiconductors are in parabolic blow-off top mode:

The two most shorted stocks are Apple and Tesla, both of which go up every single day. Whoever is shorting these stocks is overdue for psychiatric evaluation. Nevertheless, I find it hard to believe that hedge funds are shorting anything given that the concept of "risk management" is a relic of a pre-Central Bank bygone era.

Here we see the most overowned hedge fund names are in vertical mode, as overbought as they were two years ago:

Momentum Factor also two year overbought. This entire delusion being solely about momentum. How fast useful idiots can shovel money into Trump Casino. 

Before it explodes.

The Tech sector is exhibiting the same overbought pattern it did earlier in 2019 when it topped. This time the distance back to support at the 200 dma is much further:

That's the good news.

The bad news is that reflation is rolling over hard:

As is oil and Energy stocks:

Ironically, the MAGA ETF - consisting of the most corrupt industries in the United States, failed to confirm the all time high:

Politically Responsible Investing®

"The innovative strategy behind the MAGA ETF that allows you to invest in companies that align with your Republican political beliefs. The MAGA Index is made up of 150 companies from the S&P 500 Index whose employees and political action committees (PACs) are highly supportive of Republican candidates"

This is a minor preview of how this farce ends...

As I said recently, comparisons to Y2K are entirely specious.

Whereas that bubble explosion did not immediately impact the economy. This bubble IS the economy...