I made a complete blueprint on how SPECIFICALLY I m going to take advantage of this 2023 market
crash.
But not just by a measly 7%.
I m talking gains.
Something like 50x you re money.
(meme) Now this plan is a 10 step plan and each step
is just as important as the next.
So, you cant skip any of these steps.
If you take out one of these steps, the whole plan collapses and fails.
So what s the first step you may ask?
Well to figure this out, we have to take a deep dive into what s currently happening
in the market.
There are two sides.
Some investors say this is the bottom.
We are in the bottom as we speak, and the market is starting to reverse.
Then there s the other side.
Where they think this is simply just the beginning and we have another year or two before the
market starts moving upwards again.
So who s really right?
Well instead of just going off pure feelings on if this is the bottom or not, why not use
factual data and statistics to see when the bottom is most likely to occur.
Because if you find bottom, you re going to be a pretty wealthy individual.
So which side is right?
The bulls or the bears?
To find that out, we have to know why the market is falling in the first place.
You can blame, this guy.
Sorry Jerome.
Jerome Powell is the chairman of the federal reserve.
Which means, he s in control of the interest rates.
Now interest rates are a huge part of the market.
and funny enough, we can use these to our advantage.
Now I want you guys to look at this graph.
In this graph you can obviously see, every time interest rates increase throughout history,
the stock market goes down.
Now, right now we are in a downtrend throughout all the markets.
The stock market is down, crypto is down, and real estate is down.
I completely understand that rising interest rates are not the only reason for why the
market is moving downwards.
We had the corona virus, massive amounts of inflation, the Ukraine war, and so many other
massive black swan events.
But with that said, you can not deny the fact that throughout history, more often than not,
interest rates have a correlation with market movement.
So interest rates are currently around 4 and a half percent.
Which means investors are demanding a premium for investing in anything that s slightly
more risky.
So in turn, stocks and real estate look a lot less appealing.
Look at it this way.
If I came up to you on the street and said hey, ill give you a risk free guaranteed return
of 6%.
OR you can take your chances in the stock market for a maybe average of 7%.
What would you pick?
I think the answer is pretty obvious.
So that s why the market for the most part is currently going down.
Which means, there s an incredible opportunity right in front of our eyes.
Which brings us to the first step of our magical plan.
Interest rates start to rise.
Now like I said before, the fed has already started to increase interest rates, so technically
our plan has already begun.
(meme) So that s step one complete.
Now look at this.
One study from harvard analyzed investor behavior when risk free returns were low and compared
those to the same investors when risk free returns were high.
And the results ..they re pretty interesting.
Low risk free returns caused significantly more risk taking for higher yielding investments.
Then its starts to level out once the risk free interest rates are higher.
Even when the riskier investments still pay the exact same amount.
So you might be confused right about now.
That s alright.
Let me show you what this means as simply as I can.
This study found if interest rates are at 0%, 70% of the average investors portfolio
went into riskier investments, driving up the price.
So for example remember when all the fun stuff was happening?
Like doge, gamestop, amc, etc.
But what this study found, is that if the interest rates go to 5% the risky investments
went down to 50%.
So this means, most of the risk taking (like investing in stocks or crypto) occurs when
there are low interest rates.
Which if you look at these last few years.
This study holds incredibly true.
Now remember this, because we are going to come back to it later.
So going back to the plan.
The first step is interest rates start to rise.
Which means, when interest rates are rising they are pulling money out of the market.
Which makes the value of assets go down.
And when they lower the rates, they are putting money back into the market, and the value
of assets go up.
So we can watch what the fed does closely and predict what the market will do next,
or even better try to predict the exact bottom of the market.
Now its time to go into the actual nut and bolts of this operation.
How to actually time when the market is most likely to bottom.
This is including stock, crypto, and forex.
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Okay, back to the plan.
Realistically its only a matter of time before they start cutting interest rates because
they can not just keep raising interest rates forever.
In fact, they cant even keep interest rates high for a prolonged period of time.
Because they are going to force debt markets into substantially lower liquidity and that
is going to cause the price of assets to continue plummeting.
This is not good, because this is when recessions and depressions start happening and nobody
is happy.
So eventually, they are going to start cutting interest rates.
And according to all of the data and history, it is fair to assume that the bottom of financial
markets will follow reasonably soon, once the fed starts cutting interest rates.
Which bring us to next couple steps of our plan.
One, is interest rates start to rise.
Two, interest rates start to slow down.
3, Interest rates freeze.
4, interest rates start heading downwards. 5, The market creates a bottom and starts
to reverse.
So we just knocked out a lot of the steps from our plan.
Now, I want to make this extremely clear.
There are points in history where interest rates go lower, and the market keeps falling.
Which if this happened, this would ruin our plan.
So it s not a complete fool proof plan, atleast yet if you watch till the end of the video,
I ll give you some extra tactics to look for to raise the chance of predicting the market
bottom substantially.
So to be fair, the fed probably isn t gonna start cutting interest rates for awhile.
Then even once they do, its not like the market is instantly going to start reversing the
day they make the announcement.
It will probably be another 3-6 months of lag after they announce they will cut interest
rates.
So realistically, we probably won t see the actual bottom till the later half of 2023
or even 2024.
But, as you ll find out soon.
That s actually fantastic news.
So bitcoin, as you may know.
For the most part follows what the rest market does.
If the stock market falls, crypto falls.
If the stock market goes up, crypto goes up.
Pretty simple.
So if interest rates start getting cut down around 2024 and the stock market starts to
bounce back from the bottom.
That s lines us up Perfectly, for this The bitcoin halving.
A bitcoin halving is an extremely important event in crpyto.
Because it basically marks the point at which the rewards for bitcoin miners decreases.
So every 210,000 blocks that are mined from bitcoin which generally takes around 4 years,
miners get half the reward they were previously getting.
This means less bitcoin will be created and sold by miners into the market.
So less supply, for a very in demand asset will cause the market to go up.
And you guessed it, the last halving was in 2020.
Which means, the next halving is going to happen in 2024.
Now hopefully the little hamster in your head is starting to spin.
As it looks now, all of these things are going to happen in around the same time.
Creating almost a once in a life time opportunity.
So, lets go back to our plan.
Once the interest rates start going back downwards this is essentially when the bottom has been
hit.
This is when we start buying.
Stock market starts going bullish, right around when the bitcoin halving happens.
Then we get a massive crypto bull run.
Now I want to go back to that study that we were talking about before.
Remember how I said people start to invest in riskier assets when interest rates go lower.
Well, see how this comes into play now?
Once the interest rates lower people are going to start getting more risky.
Investing into things like crypto.
Just adding more fuel to the fire.
Now of course this plan is NOT bullet proof.
There are events that can happen that can completely turn this plan on its head.
Like if a country invades another country or a deadly disease spreads throughout the
nation.
That would be a perfectly good example of completely delaying the plan and we would
have to restructure it.
So my point being, there are things that can happen that will prolong or speed up this
plan.
But as promised, I m going to over some extra juicy tactics you can use right now in correlation
with what we just went over to substantially increase your chances of timing the market.
1st tip.
Yield curve.
The yield curve is a graph that outlines how much investors could expect to earn throughout
one month to 30 year terms.
And the longer you invest your money for, the more you should get paid.
Makes sense right?
Well when the yield curve inverts short term rates begin paying more than long term rates
and this signals that investors seek more risk investing in the short term than they
do in the long term.
So one study found that since 1993 the spx bottom has never occurred until the yield
curve was non inverted.
And today, we are extremely inverted.
So that s one way you could predict the bottom of the market.
Next tactic we can use is the put to call ratio.
If you aren t aware.
A call is a bet that the stock price will increase.
A put is a bet that the stock price will decrease.
And throughout history, once the market sees 1.8 puts for every call, on average the market
reversed there.
At the making of this video, we are currently at 0.69.
Yes, 0, 6, 9.
Another way you can predict the market bottom is with the Vix.
This quote came directly from Morgan Stanley.
Generally speaking, we do not see bear markets bottom without panic selling, similar to what
was seen in 2001 and 2020.
Historically speaking, no bear market has ever bottomed without a VIX reading of 45
or more.
And sure enough, If you look at every time the vix went over 45, the market bottomed
and reversed.
Then finally the last tactic you can use to predict the bottom of the market is by using
the good ol 200 day moving average.
When less than 20% of companies are trading above that 200 day moving average.
The market is mostly likely bottomed.
Today, we have approximately 30% of companies above the 200 day moving average.
But if you look at this chart, this statement holds pretty damn true.
Every time it went below 20% the stock market boomed right after that.
Now sure, using just one of these tactics by itself, probably wouldn t work so well.
BUT if you use all 4 of these tactics in correlation on top of the interest rate plan we had before,
it will give you absolutely great odds of finding the bottom.
So if everything goes to plan, we can move to our last step of the blueprint which is
to sell everything and make a shit ton of money.
In no way am I telling to use this plan.
Im just sharing how my mind works during times like this and what im going to be looking
for.
So that s my plan, in 5 years from now your either going to look at this video and think
god damn that tradinglab guy is an absolute freak of nature as im in my lamborghini orrrrrr
the plan went terribly wrong and ill be working at Wendy s.
Only time will tell.