Last year has become a paradox for many markets, where the whole world has spent fighting the pandemic and the crisis that it caused. For example, in the foreign exchange market, we have seen the growth of the British pound for more than a year, although it is very difficult to find good reasons for this, given the complexity of the economic situation in the UK and the Brexit that happened. The growth of bitcoin quotes is already 1500% in a little more than 12 months. Also, many experts note a strong increase in real estate prices. The stock market does not ignore the paradox. Shares of many companies, especially tech giants, have increased in value much more than their profits. Therefore, more and more experts believe that the entire world economy is on the verge of a new crisis, which will be provoked by the destruction of "bubbles", of which there are several this time. Moreover, experts note that the collapse of the "bubble-2021" will be much more painful for the economy than similar incidents in 2000 and 2008.
The new recession that will be caused by the crisis will be comparable to the "Great Depression" of 1929 in the United States. And the effect of the bubble bursting will be multiplied since the economy has not moved away from the crisis of 2020. Ray Dalio, head of the world's largest hedge fund, Bridgewater Associates, believes, however, that the stock market has not yet reached its limit. However, according to Dalio, he is already very close to this level. The main problem of the modern stock market is that the movements of its indices and individual stocks are less and less dependent on specific market factors. As it was before and as it should be: the company shows good financial results, expands its activities, profits grow and, as a result, the value of its shares also increases. Like everyone else now: Tesla shares are worth more than the combined value of the shares of the ten largest automakers, each of which makes more profit on car sales than Tesla.
Tesla shares have risen 8-fold since the start of the pandemic. Based on what? Based on the fact that the profit increased by 8 times? No. The same goes for other tech companies. The price of their shares rises simply because there is a demand for them. Roughly speaking, the capitalization of any such company shows simply crazy growth rates, which in principle contradicts the current state of the world economy. Moreover, the demand cannot be constantly increasing. Although the governments and central banks of the world have been pumping money into their economies throughout 2020, it should also be noted that many people have become much more inclined to save rather than invest over the past year. In other words, the demand for "hype" stocks cannot grow constantly. Sooner or later there will be a landslide. Thus, we do not claim that this year the "bubble" will necessarily be punctured, but the situation that now reigns in the stock and cryptocurrency markets makes us think and tense up.
Shares of the company Tesla in the last two trading sessions have increased by $ 60, so they again show the desire to start a new upward trend. Recall that at the beginning of 2020, there was a "mini-collapse" as a result of which the shares fell from $ 890 to $ 540. However, now the price has started to rise again and the key resistance remains around $ 702 per share. Overcoming this level will trigger a new round of upward movement with the goals of $ 738 and $ 777.
