Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Stock Market Investor Sentiment - 8th June 24
S&P 494 Stocks Then & Now - 8th June 24
As Stocks Bears Begin To Hibernate, It's Now Time To Worry About A Bear Market - 8th June 24
Gold, Silver and Crypto | How Charts Look Before US Dollar Meltdown - 8th June 24
Gold & Silver Get Slammed on Positive Economic Reports - 8th June 24
Gold Summer Doldrums - 8th June 24
S&P USD Correction - 7th June 24
Israel's Smoke and Mirrors Fake War on Gaza - 7th June 24
US Banking Crisis 2024 That No One Is Paying Attention To - 7th June 24
The Fed Leads and the Market Follows? It's a Big Fat MYTH - 7th June 24
How Much Gold Is There In the World? - 7th June 24
Is There a Financial Crisis Bubbling Under the Surface? - 7th June 24
Bitcoin Trend Forecast, Crypto's Exit Strategy - 31st May 24
Zimbabwe Officials Already Looking to Inflate New Gold-Backed Currency - 31st May 24
India Silver Imports Have Already Topped 2023 Total - 31st May 24
Gold Has Done Its Job – Isn’t That Enough? - 31st May 24
Gold Stocks Catching Up - 31st May 24
Time to take the RED Pill - 28th May 24
US Economy Slowing Slipping into Recession, But Not There Yet - 28th May 24
Gold vs. Silver – Very Important Medium-term Signal - 28th May 24
Is Gold Price Heading to $2,275 - 2,280? - 28th May 24
Stocks Bull Market Smoking Gun - 25th May 24
Congress Moves against Totalitarian Central Bank Digital Currency Schemes - 25th May 24
Government Tinkering With Prices Is Like Hiding All of the Street Signs - 25th May 24
Gold Mid Tier Mining Stocks Fundamentals - 25th May 24
Why US Interest Rates are a Nothing Burger - 24th May 24
Big Banks Are Pressuring The Fed To Losen Protection For Depositors - 24th May 24
Another Bank Failure: How to Tell if Your Bank is At Risk - 24th May 24
AI Stocks Portfolio and Tesla - 23rd May 24
All That Glitters Isn't Gold: Silver Has Outperformed Gold During This Gold Bull Run - 23rd May 24
Gold and Silver Expose Stock Market’s Phony Gains - 23rd May 24
S&P 500 Cyclical Relative Performance: Stocks Nearing Fully Valued - 23rd May 24
Nvidia NVDA Stock Earnings Rumble After Hours - 22nd May 24
Stock Market Trend Forecasts for 2024 and 2025 - 21st May 24
Silver Price Forecast: Trumpeting the Jubilee | Sovereign Debt Defaults - 21st May 24
Bitcoin Bull Market Bubble MANIA Rug Pulls 2024! - 19th May 24
Important Economic And Geopolitical Questions And Their Answers! - 19th May 24
Pakistan UN Ambassador Grows Some Balls Accuses Israel of Being Like Nazi Germany - 19th May 24
Could We See $27,000 Gold? - 19th May 24
Gold Mining Stocks Fundamentals - 19th May 24
The Gold and Silver Ship Will Set Sail! - 19th May 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

What Is The Difference Between Bitcoin, Amazon, Tesla And The S&P500?

Stock-Markets / Financial Markets 2017 Dec 27, 2017 - 01:06 PM GMT

By: Avi_Gilburt

Stock-Markets

Bitcoin has certainly gone much higher than most investors have expected, but so have Amazon (NASDAQ:AMZN), Tesla (NASDAQ:TSLA) and the S&P500. In fact, in 2015, we targeted the 2537-2611 region as our ideal target from the 1800 region. And, the market is now approximately 3% beyond even our upper target region set two years ago for just this wave degree. But, we still expect the SPX to be well over 3000 before this bull market off the 2009 lows completes.


But, I think the title to my article may be a bit misleading. Rather than look at the differences, I think the more informative exercise would be to find out what is similar.

You see, people are quite certain of the fundamentals which drive the S&P500, yet, those fundamental perspectives did not foresee the rally from 1800-2600+. People are less certain about the fundamentals of Amazon and Tesla, as they hit levels which cannot really be supported by any standard valuations. And, that brings us to Bitcoin, which really has no valuation fundamentals of which to speak.

Yet, when I propose that the fundamentals are not what drive all of these “products,” many scoff. But, rather than view them all as being driven by different factors, I view them all as being driven by one and the same factor – investor sentiment. Alternatively, trying to view them as being driven by fundamentals would cause you to perform analysis contortions or to do what is akin to scratching your right ear by using your left hand and going over the top of your head.

At some point, people may have to take their blinders off and recognize how much easier and accurate it would be for them to analyze market sentiment to determine the direction for all markets rather than claim that fundamentals are driving the market some of the time and not others. So, while fundamentals is clearly not the common driver of all markets, market sentiment certainly is.

You see, attempting to apply a form of fundamental analysis for the S&P500 when we were down in the 1800 region did not provide insight into the impending rally to 2600+. However, an appropriate understanding of market sentiment certainly did.

Attempting to apply a form of fundamental analysis to Tesla or Amazon did not provide insight into the heights either of those stocks have attained. However, an appropriate understanding of market sentiment certainly did.

And, lastly, there really are no fundamentals upon which do provide a valuation on Bitcoin. However, having an appropriate understanding of market sentiment has allowed us to safely garner thousands of percentage points in profits trading cryptocurrencies.

Price pattern sentiment indications and upcoming expectations

Many have been calling Bitcoin a bubble for quite some time, yet, Bitcoin does not seem to be listening. While the gyrations of the market are seen in very high percentage moves on both sides of this market, it is not likely that Bitcoin has seen its major top yet. In fact, early 2018 may provide some surprises to the bubble heads, as Bitcoin seems to have a date with 34,000 once its completes this current pullback.

Moreover, those that have been saying the stock market is about to crash for the last who knows how many years will also be surprised when it eclipses 3000SPX in the coming years.

However, in the shorter term, I am still looking for a potential pullback in the stock market. But, the market may still attempt one more extension before that happens. While I noted a potential topping in the XLF last week, the structure developed over this past week that may suggest it can see the 29 region before it begins that wave 4 pullback for which I have been looking. In fact, if the XLF is unable to break below 27.63, and sees a strong break out over this past week’s high, it does open the door to the 29 region before it comes back down to the 27 region.

So, while the SPX has now extended approximately 3% beyond the target I set 2 years ago, and can still see further extensions, I think 2018 will present us with a nice pullback back towards the 2400 region, which will point us up towards 3000 region thereafter.

Avi Gilburt is a widely followed Elliott Wave technical analyst and author of ElliottWaveTrader.net (www.elliottwavetrader.net), a live Trading Room featuring his intraday market analysis (including emini S&P 500, metals, oil, USD & VXX), interactive member-analyst forum, and detailed library of Elliott Wave education.

© 2017 Copyright Avi Gilburt - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in