President Black Swan Slithers into the Year of the Snake, Chaos Rules!

Stock-Markets / Stock Market 2025 Feb 02, 2025 - 05:20 PM GMT

Dear Reader

Did you enjoy Monday's black swan panic event that caught everyone by surprise? MSM needed a reason to explain why to it's audience and so plucked deepseek as a likely reason for the sell off in stocks and crypto's despite the R1 model having been released a week earlier!

It's amazing how MSM focuses on nothing burgers to try and explain that which they don't understand. Mondays drop in stocks and crypto's was due to two black swans - Yen carry trade unwind and Trump firing tariff threats, the problem with most analysts is that they go looking for a reason AFTER the event has happened, hence 1+1 = 3 such as Deepseek which is a nothing burger! I started warning of the emerging risk of a black swan panic event early last week as I could see the Japanese Interest rate black swan swimming fast towards us in addition to the big Black Swan generator in the White house.

The reason why Nvidia took such a big dump is because that is where the carry traders had been stuffing their borrowed Yen and when Nvidia falls it pulls the sector down with it! I mean what has crypto got to do with Deepseek? Nothing but it dumped because of the CARRY TRADE UNWIND! Yes deepseek has some impact in terms of it's 'openness' but is far more marginal than what Chat GPT was to Google which was a nothing burger.

It's all there on the charts!

Yen Carry Trade Unwind = Dollar down - Yen up - Tech stocks down!

Meanwhile President Black Swan continues to spit black swans in every direction, it's becoming chaotic in how his signature tends to negatively effect the lives of so many ordinary Americans.

Apparently at the stroke of a pen Trump suspended medicaid?

President Trump is the agent of chaos, one only need look to Greenland that is preparing for a possible invasion prompting Europe to unite against the emerging common threat.

Happy Chinese New Year of the SNAKE!

Ones definitely slithered into the White house (Musk). Apparently chaos reigns supreme during year of the snake, tends to be worst year for stocks resolving in an average S&P gain of less than 1%, 2025 is definitely going to be a much more chaotic year than 2024 which was the year of the Dragon that implied a 11% gain, 2023 was the year of the rabbit +12%, whilst 2022 was Tiger +10%.And 2026 will be the year of the Horse +6%. So this year according to the chinese zodiac will be a bad year for the S&P.

All of the snake years: 1929 -12%, 1941 -18%, 1953 -7%, 1965 +9%, 1977 -11%, 1989 +27%, 2001 -13%, 2013 +30%.

It's does not look good for 2025, the pattern suggests a down year! Though I am sticking with my trend forecast as per previous article.

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By Nadeem Walayat

http://www.marketoracle.co.uk

Nadeem Walayat has over 35 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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