Trumpcoin? Will the "Trump Bump" follow Bitcoin?

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iGoddard
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Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Sun Feb 11, 2018 3:41 am

Notice a similar parabolic rise in the Dow Jones and Bitcoin, followed by sudden intense turbulence.

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Such a parabolic upward sweep is not to common in the stock market, wherein peaks usually form humped-over convex curves, rather like puffy clouds. But the post-Trump bull run seems to be concave upwards, or parabolic. Here's a hypothetical future model inferred from the shapes of recent past trends...

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Of course that's just a guess that might be wrong, but to a fool like me it seems a plausible hypothesis. The fact that since 2009 the average growth of stocks has been 12.8% while that of GDP has only been 2.7% suggests stocks are in fact overvalued relative to real-market value and thus are arguably overdue for a correction. The idea that stocks can just keep rising at the pace they have been despite less robust economic growth seems like pie in the sky... a parabolic pie in the sky!

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby TJrandom » Sun Feb 11, 2018 4:04 am

Whew! From the thread title, I thought maybe he was getting ready to issue a new coin bearing his likeness... maybe a 3-cent piece, made of yeller plastic... :?

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Sun Feb 11, 2018 8:57 am

Couple nice graphs showing the parabolic trend...

Here's a slice and dice review of the Parabolic Dow trend correcting.

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@ twitter.com/_the_archer/status/961943714800181248

The Dow's parabolic upturn suggest this is turning into a FOMO market (fear of missing out) as investors chase price. Parabolic uptrends usually do not correct with shallow pullbacks, when they are broken. Bitcoin recently broke its parabolic uptrend.

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@ twitter.com/markminervini/status/957996255472480261

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby Gord » Sun Feb 11, 2018 9:56 pm

I don't understand the part about "Trump bump". Is someone [other than Trump] saying that the rise in the stock market was due to Trump?
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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Mon Feb 12, 2018 12:32 am

Gord wrote:I don't understand the part about "Trump bump". Is someone [other than Trump] saying that the rise in the stock market was due to Trump?

Ya, it's certainly open to debate and is at best a 'simplistic explanation' for the parabolic climb. But "Trump Bump" isn't a term I made up. Here's an example of its usage from The Washington Post, hardly a Trump-friendly paper:

The ‘Trump Bump’ in the stock market is real. But it’s not helping Trump.

To evaluate these claims, we examined three major market indexes (the Dow, the S&P 500 and Nasdaq) from Jan. 5, 2009, to Dec. 22, 2017. We constructed a statistical model that captures the general upward trend in stocks since early 2009 but also examines whether there were changes in that trend that occurred after Trump’s election victory. (Details about the model are here.)

The results do show a change after Trump won: The pace of the upward trend in the three market indexes increased. And the estimated impact of Trump’s victory is sizable. Nearly two-thirds of the increase in the Dow since the 2016 election can be attributed to the “Trump” component of the upward trend that began in 2009. The S&P and the Nasdaq also show significant upward moves.


If it collapses, as it sure looks likely to do, both on commonsense and what's begun to happen, it won't look good for Trump. Right or wrong, presidents tend to 'own' the economics that unfold during their terms.

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby Gord » Mon Feb 12, 2018 2:04 am

Cool. I get my market analyses these days from watching bits and pieces of Washington Week over the shoulders of old men. This is the first I've heard of the "Trump bump". Usually I hear it's just the continuing upward trend of the market since around 2008.
"Knowledge grows through infinite timelessness" -- the random fictional Deepak Chopra quote site
"Imagine an ennobling of what could be" -- the New Age BS Generator site
"You are also taking my words out of context." -- Justin
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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Mon Feb 12, 2018 11:32 am

Gord wrote:Cool. I get my market analyses these days from watching bits and pieces of Washington Week over the shoulders of old men. This is the first I've heard of the "Trump bump". Usually I hear it's just the continuing upward trend of the market since around 2008.

Right, I hear that too, typically from those who want to deny Trump's claim of credit. But as the WaPo analysis I cite above found, since Trump took office there has been a statistically significant increase in the stock market. While even that isn't proof of cause, it's not unlikely that people who are inclined to invest overall lean conservative, and, right or wrong, they see Trump's win as a harbinger of tax cuts and economic growth, and so they're investing in an expectation of a booming economy. Given that causal model doesn't seem too far-fetched, the 'Trump bump' seems a plausible hypothesis.

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby OutOfBreath » Mon Feb 12, 2018 5:20 pm

It looks like the "Trump bubble" will soon be the correct term. Driven by exaggerated conservative faith in deregulation as the goto answer...

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby OlegTheBatty » Mon Feb 12, 2018 10:38 pm

It seems too soon for another Minsky Moment, but considering that nothing was fixed in the US financial system, maybe not. If the bump is consistent with Minsky's Instability Hypothesis, the Trump Bump may be nothing more than coincidental to a bump that was building anyway.
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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Sat Feb 17, 2018 9:58 pm

So far the unfolding course of the parabolic concave-up "Trump Bump" is compatible with a convex-down collapse, which typically come down with in a jagged saw-tooth-edged fashion often with the upswings of the teeth demonstrating a continuity of the parabolic rise of the bubble it's on the dying side of, exactly as seen in this week's DJI.

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Here's a collection of several concave-up bubbles in recent history showing similar jagged-edged convex-down formation...

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What goes parabolic up will probably go jagged-edged convex down.

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Wed Feb 21, 2018 5:50 pm

Using the Elliott wave principle, this technician called the top of the DJI just days before the parabolic climb cracked up. He posted this daring prediction on Jan 30, and the peak crack-up started three days later on Feb 2:

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In an earlier post, seven days before the peak crack-up, he described the Elliott-wave principles he applied to predict the crack-up even when only a long bull climb existed:

The DJI looks to have completed an Elliot 5 Wave Extension. This is typically followed by a loss of equal magnitude to the gain of Wave 1.


So the virtical line he's placed to the right reflects the magnitude of the growth during Wave 1, and by EW theory, that should be the magnitude of the correction. Whatever truth there might be in that, his top call was an amazing bullseye! In contrast, if my guesses above prove right, I just made them after they seemed obvious, after the peak crack-up had struck. In contrast, this guy looked at a long green bull run and calls for a sudden bear pivot out of nowhere. And bang! It happens, as if on cue! However, there was some reason to suspect it aside from EW theory... the parabolic climb. That by itself is a red flag for an impending down-turn pivot. The only open question is the magnitude of the correction...

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Sat Mar 03, 2018 8:36 pm

While the course of the Dow continues to follow a path fitting my prediction above, there might be some signs in the post-peak shapes that suggest a recovering continuity of the prior bull run. At the same time I'm somewhat skeptical we can infer future market trends from past trend shapes and am suspicious that methods used to do so, as for example the "Elliot wave principle," might be nothing more than modern tea-leaf reading. At the same time, it seems obvious that buying Amazon shares is a better decision that buying Sears shares. So there must be a path of reasonable, even if not perfect, prediction in the realm of market soothsaying.

All that aside, the rising peaks and troughs within the post-peak turbulence might seem to suggest this possible course (here I used the S&P 500, which pretty much matches the Dow I used above):

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And close-in on the Dow...

Image

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Re: Trumpcoin? Will the "Trump Bump" follow Bitcoin?

Postby iGoddard » Sat Mar 24, 2018 3:40 pm

The optimistic alternatives fall to the wayside as the Trumpcoin collapse proceeds apace.

Here I've updated the "Trump bump" in my graphic above to closing bell, Mar 23, 2018:

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