Michael Burry has gone on a Big Tech selling spree

This is a MAJOR warning signal for the economy

A thread 🧵 2/ Michael Burry recently sold about $50 million worth of his stock portfolio

This is the same investor who foresaw the housing market collapse in 2008

And made millions by being on the right side of it

Labor market is weakening

Trouble is coming for the US economy

A thread 🧵 2/ Prior to the 2008 recession, initial jobless claims had begun trending higher

This was an early recessionary signal

Which also happened before the 2001 and 1990 recession

Yield curve steepening from an inversion is THE recession signal

This is exactly the stage we’re nearing

Quick thread 🧵 2/ Despite rising initial jobless claims, the yield curve hasn’t been steepening yet

History tells us it’s about to get ugly

More inversion days = deeper drawdown

We’re already at +700 days

This ONLY occurred in 1929

A thread 🧵 2/ The yield curve has now been inverted for the longest period since 1929

This signal has accurately predicted every economic downturn

And also reflects the condition of the labor market

Rising claims have accurately predicted EVERY economic downturn

But if history repeats, the market could still rise for another 100 days

A thread 🧵 2/ In the months leading up to the 2008 recession, initial jobless claims began to trend higher

This was an early recessionary signal

Which also happened prior to the 2001 and 1990 recession

Major warning signs are flashing

Which last happened before the 2008 & 2020 crash

A thread 🧵 2/ Between Jan and Dec 2007, the banking sector dropped by 25% relative to the rest of the market

Even the consumer discretionary and homebuilding sectors saw a big decline

Recession is closing in

This won’t end well

Quick thread 🧵 2/ Major market corrections usually coincide with a rising unemployment rate

Market rally is blinding investors to the dangers of sector weakness

It’s a MAJOR economic warning signal

A thread 🧵 2/ Between Jan and Dec 2007, the banking sector dropped by 25% relative to the rest of the market

The same pattern appeared in the consumer discretionary and homebuilding sectors

Big divergence between Bitcoin and S&P 500

What does history point to?

A thread 🧵 2/ In Feb 2024, Bitcoin brokeout above its rising channel

Alongside the S&P that was making new highs

In just 30 weeks, the market gained 4x the avg annual return

Is there more upside left in this melt-up?

A thread 🧵 2/ Seeing such a large move up in a short time is rare on the S&P 500

In the last 40 years, this has only happened 6 times

Some led to major rallies, while others preceded market peaks

You can view all our market positions at:

bit.ly/GameofTrades

Gold has broken to new all-time highs

History shows this is a BIG warning signal

A thread 🧵 2/ 1st Oct 2007: Gold broke made ATH for the 1st time in 1.5 years

Thereon, the unemployment rate began rising rapidly

And economic growth slowed down

Which ended in the 2008 Financial Crisis

Don’t be afraid to buy stocks breaking to new highs

Nicolas Darvas turned $10k into $2 million

He traded ATH breakout stocks with the Darvas Box Method

A quick breakdown of how it works 🧵 2/ Main Elements:

- Used as a trading strategy
- Defined risk management system
- Maximizes profits, limits downside
- Can be used in all timeframes

US government debt market collapse has started

This has MASSIVE implications for the economy

A thread 🧵 2/ US government bonds have broken below a 40-year uptrend

After experiencing one of the most aggressive bear market since the 1980s

The S&P 500 is at all time high

But only a few stocks are pushing it

This is a MAJOR signal

A thread 🧵 2/ Today, 20% of the S&P 500 is made up of 3 companies: Apple, Nvidia, and Microsoft

These 3 have posted incredible returns over the last few months

Driving the majority of the recent rally in the S&P 500

US economy is yet to fully feel the impact of the hiking cycle

Rates indicate continued economic weakening until June 2025

Quick thread 🧵 2/ Flipping the interest rates chart and adding the ISM New Orders Index shows a strong relationship

Interest rates predict economic trends around 1.5 years in advance

Massive divergence between Bitcoin and S&P 500

What is happening?

Quick thread 🧵 2/ In Feb 2024, Bitcoin broke out of its rising channel

Alongside the S&P that was making new ATH

This is about to change everything

Quick thread 🧵 2/ It all begins with the Fed

They control the "price of money" by adjusting interest rates

Which in turn influences borrowing costs

US economy is yet to experience the full impact of rate hikes

High rates point to economic weakness until June 2025

Something is bound to break

A thread 🧵 2/ The ISM New Orders Index has plunged to its lowest level in over a year

What seemed like the beginning of an economic recovery in 2023 now appears to be reversing

Potentially signaling an economic downturn similar to 2008 and 2001

Consumer defaults have hit the HIGHEST level since the Financial Crisis

This won't end well

A thread 🧵 2/ Rising consumer defaults typically signal a weakening economy

Which causes stock market volatility to rise

Hindenburg Omen has just been triggered

This is a MAJOR warning signal

A thread 🧵 2/ The Hindenburg Omen was developed in 1937, giving us almost 100 years of data to evaluate its effectiveness

It has signaled important peaks on the NASDAQ 100, including 1987, 1999, 2007, and 2021

A MAJOR bullish signal has just flashed

When the MOVE index drops, markets rally

A thread 🧵 2/ The MOVE index, which measures interest rate volatility, is dropping from levels not seen since 2009

This trend presents a significant opportunity in the coming months that many are overlooking