The Coming Collapse: Charts Speak Louder Than Words (w/ Raoul Pal and Peter Brandt)
RAOUL PAL: Peter, it's great to catch up with you. I've not seen you in a while. Unfortunately, this is electronically and not in person, but it's always brilliant to be able to sit and pick your brains in what you think's going on. None of us have a crystal ball, but we're just all observing things and trying to figure out what the probabilities are of certain outcomes. Look, I really thank you for your time as ever. PETER BRANDT: You bet, it's always my pleasure to be with your wonderful audience at Real Vision TV. You know how much I respect you guys, you know how much I love you and been down there in Cayman with you. I always, always cherish the opportunity to chat with you about the markets. RAOUL PAL: Fabulous. Peter, let's start at the very top level. We've seen some tremendous price action, let's start with equities for the time being as a place to start. What do you think is playing out here? Because the market is trying to grapple with, is this a shorter term thing, or is this potentially a larger thing? I've made my opinion quite clear that I think it's possibly something larger. When you look at the top down picture, what do you think of this in terms of these charts? PETER BRANDT: You're the guy that really understands global macro stuff and fundamentals. I'm not. I look at charts and draw funny little lines and try to make sense of it and think in terms of possibilities, and that's how I'm viewing this, in terms of possibilities that obviously can modify or change or more for the time, but I traded markets for a living since 1974 and I've never really seen anything quite like we've had the last two months. It's unprecedented. I was in the market, some people tease me that they say, how does this compare with the Great Depression market? Because a lot of the older guys are in here. I missed that one by 12 years. This is absolutely crazy. I guess I subscribe to the theory where there's smoke, there's fire, or there's definitely something hot going on. Of course, we all know that it's tough to fade the Fed, you don't want to fight the Fed and the Fed is not only throwing the kitchen sink, they're throwing everything in the kitchen, including a broken toaster at this thing and I'm just surprised that we've seen the rally that we've seen and so I see that type of decline that we had coming off the highs this year as really the possible beginning of a pretty serious decline. It's all pretty much gun to script since this market has rolled over, including this rally that we had. We got overdone on the downside. Taking the S&P back to 2180 or so was a little bit too much for the first big leg down but you look at the volume that has come in here. In my mind, huge slugs of volume is either starting volume or stopping volume, and so we could say all of this huge slug of volume is really just demand coming in off the bottom. It's really difficult for me when I look at circumstances possible 20%, 30% unemployment in the US, lowest retail sales in history, still the threat of a global virus, health virus to think, I go, hey, for the few stocks that I still own, if somebody wants to come in and pay me an all-time high price for them, they can have them. I'm viewing this thing, Raoul, as really the first big leg down and what could potentially be a more significant bear market that this rally that we've had in the S&P is up into this 2800 level, it may be all it is. Last Friday, I wrote a fairly long letter to the people who follow me for the Factor Research Service, and I explained to them why last Friday, I sold every last share of stock that I owned. I managed to ride through some shares all the way down, rode them all the way back and I explained in the letter, I'm getting out of everything. I don't want to own any stock here and I was lucky last Friday, we've taken out last Friday's low or high, but we've now sold off. As a technician, I'm viewing the S&P has a possible massive head and shoulders top that we put in the left shoulder in 2018. That's where the high came in, we dropped down into that December 2018 low, which is the left shoulder low, then we've rallied into the high early this year in this big drop that we've had is the right shoulder low, and now we're rallying back toward that left shoulder high. Somewhere between 2800 and 2950, I really anticipate that you're going to see a right shoulder high, roll over and then really begin the bear move that's yet to come. RAOUL PAL: In assessment, because you reached out to me on Friday and said hey, listen, this is what I'm thinking, and I was like, was it Friday? Whatever day you reached out, I'm like hadn't even really looked at that because I was so intensely looking at the chart in a different way and I looked at it, that makes total sense. It could be an even bigger top pattern than I really had in my head. I thought-- and I was also eyeing this 50% retracement thinking this is an area that you could possibly stop. Now, it actually has stopped around that, maybe it does, maybe it doesn't, maybe it goes up further, but it's really interesting to me and I just don't think people are prepared for that outcome. Now, again, as we've always said, [?] the chart that play out that way, but it just looks interesting. I think there's a really good chance that you're right on this. PETER BRANDT: To strip out dividends, the break that we had in 2008, the S&Ps was down right around 54%, 55%. You apply that to the S&Ps today and say certainly, we can create just as negative global macro scenario today as we could back during the mortgage crisis, that takes the S&Ps back into the area of 1700. Even if we have a 50% correction in the S&Ps from this year's high, all of a sudden, we're looking down in the area of 1700, but we go to 1700, we complete the head and shoulders top and we then potentially go a lot further. RAOUL PAL: What would be the measuring objective of that head and shoulders top you think roughly? PETER BRANDT: Well, I'm going to pump this out because I think to look at it, we can't really do it arithmetically. I think we have to probably look at it, Raoul, on a log chart basis. If we look at it on a log chart basis, it can get pretty ugly. We could be looking at prices potential down in the area of 1300, 1400 on the S&Ps. RAOUL PAL: Wow. When I read a chart that way, I then often start to look around at other supporting evidence that that could be the case. If you're looking at anything within equity world or sector world, are you picking up similar things that's saying, huh, okay, this fits in with that point of view? PETER BRANDT: Not necessarily in terms of sectors, because generally, there's way too many sides. I'm a futures trader. I'm a forex trader. When I try to put together a mini narrative, so to speak, on a more composite basis, for me, I don't wander all the way into sectors because that's just too deep a water for me. Rather, I'll tend to look at what's going on in a composite of other markets. Yeah, I think I can create the story because a significant downside move in the equity market makes sense to me. For instance, when I look at metals, when I especially look at interest rates, all of a sudden, a mosaic comes together that says if this happens, then that would make sense to what I'm seeing, for instance, over and the 10-year, the 5- year, the 30-year, the Eurodollars, all of a sudden, that would tend to line up and then indeed, I think it's what we're seeing. RAOUL PAL: I looked at-- I do a similar process as you by seeing how things evolve across all asset classes, and the CRB index and any of the commodity based index, big, huge top patterns, big, massive monthly head and shoulders tops and stuff like that that I've never seen in my career, I've never seen them on the charts in history before, tops of this size. I look at that and think, wow, oil is obviously playing itself out. How do you see that commodity complex right now? What's interesting to you in how you're reading it? PETER BRANDT: I have mixed emotions there. I started as a corn trader, I understand the corn market, I look at the price of corn, and with the decline that we're seeing in corn as we speak today, we're down in an area that we haven't seen in a number of years. As a matter of fact, when I started trading corn in 1974- 1975, corn was trading not adjusted for inflation, but trading at approximately the same price it's trading today. We're seeing corn prices right where they were in 1975 and 1976. That's almost a 50-year period of time, corn prices haven't gone up and of course, American farmers would be the first ones to remind us all of that. Corn is a perfect example. We have a potential huge head and shoulders top on the weekly continuation chart of corn, but I'm split between what's the basic value or at least value relative to what my experience is and just the pure chart pattern itself. Pure chart pattern itself in corn tells me that corn, that raw material prices can go substantially lower but yes, there's a value investor part of me to that goes, wow, I've a chance to own corn at 50-year lows. That's a pretty cool deal. RAOUL PAL: Yeah, and that's not the same in metals I guess. Metals are still more elevated overall. PETER BRANDT: Yeah, they are. They are, and of course, crude oil is getting back there too. Crude oil is back in areas where I traded crude oil back in the low teens in the past. It's been a number of years, but they're getting back in there, but their raw material prices are very weak. For instance, when we look at data adjusted sugar prices, which go back and adjust prices to take away the role charges we have from going to one futures contract to the next, we're at all-time lows. We have never had sugar prices as low as they are today on a back-adjusted price chart basis. There's a number of commodities that look that way. Same thing with some of the livestock markets, its cheapest can be. There's part of me though, particularly in some raw materials, where I go even on a global macro basis, I can't really become a bear. I think wheat prices are a perfect example. People are going to have to still eat. There is the basic necessity of human beings to consume food. If I'm looking at wheat prices and saying we're already done in the area of the same level of where I traded wheat prices back in the mid-70s, maybe I can just get all buried up. There's a better place to be a bear, I guess is what I'm telling you. If I'm going to be a bear, it's not going to be on raw material prices. I'll be a bull on interest rate futures. I'll be a bear on equities. I'll look to trade the grain. RAOUL PAL: Commodity prices are telling you that it's consistent with the equity market falling further is the fact that commodities look weak, whether they rebound, whether ags rebound or not, okay, but it looks weak as a structure. What are you seeing in the FX market, because I'm mesmerized by the chart of the euro right now? PETER BRANDT: I will tell you, I'm looking for you to share your wisdom on here and let me tell you why. Because, yeah, I'm a technician, but I'm not deaf to everything that's going in the world. I still live here on this planet. I'm looking and going we've got a Fed that just is into QE infinity, the word infinity has now been adjusted by the US Fed. They're throwing everything on here. Part of me goes, wow, that has to lead me to a bias that the US dollar could get really clobbered and I tried my hands here in the last week or so with the long side of the euro, the Euro FX, I got run out on stops for a breakeven trade today, but behind the scenes, I'm thinking, wow, this can't be constructive for the dollar for the Fed to just flood the globe with greenbacks. Then I look at the Euro chart and I go, we ever get under 105, 80 cents, here we come. In the back of my mind, I'm aware of the fact that the 50-year trendline in the euro currency-- now, people will say, well, the euro hasn't been around for 50 years, how do you get that? Well, you get that because prior to the euro, you can put together a trade weighted basket of the old European currencies, and which become a proxy for the euro. You track that back into the '70s, we have a 50-year trend line that has held on a number of occasions in the euro currency. Well, we've tested that hard here this year, we take out 105 in the euro currency, and boy, that's all she wrote. Then I really have to turn and say, I don't know the story of the end the dollar, but I have to be bullish on the dollar. RAOUL PAL: You see, I hear the narrative of the Fed printing. I hear it. I see the Fed doing stuff. I look at the charts and I look at the charts of stuff like the euro, which seems like it's forming this huge and powerful triangle, whichever way it breaks is going to be a massive move. Because of the 50-year trendline, that would be a spectacularly powerful move should it move lower. PETER BRANDT: It's one I don't want to miss. Let me tell you that. RAOUL PAL: I'm looking at that and hearing the narrative, and I love it when the narrative is the opposite of what the charts are telling me. I look at corrective price action of other currencies, have you ever looked at-- you can't trade it, but I don't know if you ever looked at ADXY. It's the Asian currency. That has got this massive multiyear, multidecade head and shoulders top. I look at that, it makes me go, same thing. I look at that. I look at those commodity charts. I look at the head and shoulders in the S&P. I look at that euro chart, and I'm like, it's just like it's got a massive dollar rally and a debt deflation written all over it. If everybody in a debt deflation owes dollars, that's why the dollar goes up simply and you can print as many as you want, but nobody's got the cash flow to pay it back. PETER BRANDT: It's just a good old fashioned short squeeze, is really what you have and you got-- the entire world's commerce system is in the short dollar position. You get the entire global economic system short dollars and all of a sudden, you hit some key trade points and certain things happen on the fundamental side on what's going on in the world and you've got to scramble to cover short dollar positions. RAOUL PAL: I'm going to ask a really hard question because nobody can get this one right. What is the longer term chart of dollar/yen to you, up or down? PETER BRANDT: Confusing because it's a triangle and I hate triangles. Raoul, we talked about that. I tend to like patterns when the breakout of a pattern really is through a horizontal line, diagonal lines tend to give you big false starts, tends to give you further morphine, and will take you out. I'm confused on the on the yen. The yen chart has absolutely been a nightmare to me for a long time, but I do see the coil. The yen is coiling up. Boy, I tell you, it's the old analogy of you take a beach ball and you push it down under the water, and you try to hold it there, hold it there and you hold it there, sooner or later, that thing's going up. RAOUL PAL: I looked at this, and I look at that euro chart. I look at that ADXY chart, and I look at the commodities chart, and I'm like, dollar/yen could get to 200 which is what again, it's the opposite of everybody's narrative. Now, I could be dead wrong. I could be building a false narrative myself, but I just look at it because of that coiling pattern and the fact of it hits low a while ago. It looks like it's building strength for dollar/yen to go higher. PETER BRANDT: I think you're right. We take out this year's existing high in dollar/yen, certainly you want to place your bets on a currency that's got a lot of green ink and that's the US dollar, but we continue to coil and as you know sometimes, coils can be very difficult. You can do all kinds of weird things in coils, you can have false breakouts and do what the old chart masters called an end around or an end run, you can do all kinds of sneaky things. In terms of dollar/yen, I'd rather just sit back and wait, say, okay, let's declare yourself and I'll try to make sense of that. In the meanwhile, there are certain places where I definitely want to be long dollar for instance, in the Mexican peso. A Mexican peso looks to me that no matter what the dollar's going to do, peso looks like it's going to go down, dollar's going to dig in on the peso, as it has really for the last throughout history. Yen, I want to wait. I want to keep my eye on that. It's been in this coil that's done nothing really for last five, six years but my eye is really on the euro currency. That's the chart I want to look at. That five level is going to be key. RAOUL PAL: The other two charts I want to ask you in FX lands before we move on to fixed income is the long term charts that dollar/Brazil is spectacular. PETER BRANDT: Oh, and there's the futures contract there. That's what I love about it. You put me into a world where I've got a futures contract to trade. That's marvelous. That was a really clean breakout and a lot of people were scared of the breakout there because they're looking at the negative carry of the trade. They're looking at the big interest rates down in Brazil, so they're short Brazil. Now, they're loaning dollars so they got to pay the differential, the interest rate differential but when you get a currency to move like that, I don't care what the interest rate differential is, you're going to make money on it. I look at that and I just think that that's a market that's going to go a very long way. I'll tell you, the price level I think that we go down and of course, this is I think we'd go down where the real, a good guide to 10 cents, 15 cents, something like that. I think that's where we're going. This is a big trend. Now, it's late in the game. We've come a long way. We're at 19, we were at 25 not very long ago. Nevertheless, I do not want to own money sitting in Brazil. RAOUL PAL: What about the RMB? PETER BRANDT: I think same thing, you had it same thing with India. You just really want to own the dollar. You want to own the dollar in those particular currencies which really comes back to the fact that I'm split somewhat as you acknowledge in terms of the dollar index, in terms of the euro, there are certain currencies where it's a no-brainer and that is being long dollar against peso, against Brazil, against South Africa. Those are plays that makes sense. As a trader, I always am thinking if I'm going to be long the dollar, I want to be long the dollar against the weakest currency there is. If I want to be the long metals, I want to be the long the strongest metal. I don't want to play catch up. I don't want to think, well, gold has had a big move, but silver hasn't had a big move, so I'll buy silver. No, I want to be long where the strength is. There's already some currencies where the dollar is in a very strong trend. That's really where I want to be. RAOUL PAL: Let's talk about fixed income because you and I were swapping notes about that. I think there are some amazing charts currently. They're slightly shorter term than the big picture of charts you've been looking at, but they look really interesting. What's your thoughts? PETER BRANDT: There are longer term charts and there are shorter term charts, but then there are just some asymmetric trades that are just sweet. You can give me that off of a monthly chart or you can give me that off a $6 chart, but asymmetrical is asymmetrical. The charts indicate to me and they've indicated to me for a very long time that the US is going to join Western Europe with negative interest rates. That's the stories the charts told me. When I look at 5-year yield charts, when I look at 10-year yield charts, when I look at Eurodollar charts, it's telling me we're going to minus 20 to minus 30 basis points. They all target that area. That's where I think we're going. We'll flatten out the yield curve, but perhaps the tail end of the long end will retain some yield to it. Generally speaking, I want to be long 5-year notes. Futures, I'm talking futures now, I want to play the long the 10-year, I want to be long the ultra-notes, I got a buy signal today in the bonds, went with it. We're going to get buy signals in the euro. Again, it's a shorter term play, but hey, I'll take money when they put on the table, whether I have to reach my hand and keep it there for a year or I can put it on the table, grab the money and remove it immediately. RAOUL PAL: Because, look, in simple terms, I see that same, the long term tops don't look like they're going to negative rates. We know that the Fed desperately needs rates to get to zero. They've been a little bit sticky recently after the first bout of stuff and the illiquidity in the system. When I'm looking at the 5-year, it's a perfect chart plan here and it fits the narrative what of the Fed want. The Fed is in your favor here, it's not like shorting stocks where the Fed are trying to do the opposite to you, the Feds are in your favor. We've gone through all of these charts about the potential disinflationary pressures and stuff like the dollar. It just looks like it's an amazing setup. PETER BRANDT: It does, it looks a little bit like it did back in mid-January. We had some wonderful buy signals in the Treasury futures back mid-January. There were extremely low risk spots to get in, there was some significant upside targets that we're looking at. It was an easy play, and then again, in mid-February, we had an easy play, it was a layup. They were layups. You call the euro just wonderfully well in all of the interest rates. Well, I think we have a pretty similar thing right now and we have a lot of people that don't want to believe it. That's what I like about it, you go and put out on Twitter that the charts all look like, we're going to negative interest rate policy in the US. You'll get trolled like crazy. RAOUL PAL: I did exactly that, and I got trolled like crazy. It wasn't, can't you see it's hyperinflation. I'm like, I understand your narrative, but the charts don't tell me that, nor does the dollar, nor do commodity markets, nor does anything, nor does the equity market. I understand why you might think it's hyperinflation, but I don't see it in the charts. It looks like we're going to deflation. PETER BRANDT: Well, it does. I always come back to something I once heard Paul Tudor Jones talk about that is that last leg of the market, where it's easiest to pick up on it, it's that last thrust, and so yeah, they may be right that all of this printing press money is going to eventually take us to higher rates in the future, higher yields in the future. That may be true, but sometimes when you're too early with an idea, the market will punish you. Also, in the back of my mind is the fact that this could be that everyone has talked about the big blow-off, we've been in the big blow-off since the early 1980s toward lower yields and maybe this is now finally the blow-off that takes us from where interest rates were back in '82, '83, '84 to now, finally, where they go with negative interest rates, but the charts all indicate to me that in the short term, the risk is in being short Treasury futures, not in being long Treasury futures. RAOUL PAL: The next two ones are ones that I'm always interested in, as is everybody else. We've now built a chart that's interesting. Everybody goes to the next two things. Gold, Bitcoin. PETER BRANDT: Yeah, I knew where you're going. I just didn't know what to order. That's a logical order, by the way. When you stop to think about it, yeah, you're taking things in a very logical sequential order that here's how dominoes fall. You have to figure out the base of a pyramid before you figure out the top and that sort of thing, so I think it's very logical. RAOUL PAL: To see with goals with me is this divergence, a lot of technical guidance I trust don't trust this rally, but all the fundamentals would suggest it goes further. The positioning is extreme. I feel nervous and I don't know what to do. I feel a bit trapped. What do you think it is? PETER BRANDT: Well, I'm going to go back, Raoul, and make a point that I've made in writing a number of times, going back to June of last year. In June of last year, we had an upward thrust in the price of gold that completed a massive multiyear chart pattern. That gave a target by the way of 1778 met two days ago. The point I'm making is when we started climbing off the bottom in the middle of last year, June, July, August, people were making the point that the commercials were net record shorts, the specs were net record longs in gold. They're going certainly a tad, can't keep going up because the commercials keep selling it. Well, it was interesting they said that because if you went back into history, actually, there was one other time when the commercials had a large net short position, the specs had a larger net long position and that point in time was just at the very start of $1,000 rally in gold that started basically in I think it was August, September 2009, where gold started a massive move going from 1000 to its eventual high, that had a very similar composition of open interest as we have had during this run up in gold now, so I really don't buy the fact that, oh, my goodness, you've got the commercials stacked up on the short side of gold, then that obviously has to be bearish. Because when you get capitulation by commercials in the market, that is when you get the strongest possible moves is when the commercials are forced to capitulate. They've been forced to capitulate an awful lot already, they may be forced to capitulate further. The shakeout in gold that we had, that faked me out a little bit. It didn't fake out my opinion of gold, what it did is fake out my positioning, it faked out my tactics, it created that havoc to my tactics. RAOUL PAL: I had that. Threw me out a bit, and then I've been scrambling on the backfoot since. PETER BRANDT: I think we'd go higher. We're up here. I think the Elliot guys are all bearish gold, which is usually good because the Elliott guys are usually wrong on everything, although they call those stock market decline pretty well. I just think the path of least resistance is off. We have had some really weird things take place within the basis, basis being price differential between physicals in the nearby future, those are a bit erratic here in the last 30 days or so. They've just been completely whacked out due to deliverables, the position of deliverables against the COMEX contract, but I think gold just continues higher. It's probably going to stair step, it's going to climb a wall of worry, but in my opinion, I think we'd go 1950 and then I have to re-judge it from there. Having said that, I also have to have full disclosure that having really turned into a significant bull in gold in June of last year, I covered half my position two days ago in gold when it hit my 1778 target. I definitely would be willing to replace that position should we get back towards 1700. RAOUL PAL: Final one, Bitcoin. PETER BRANDT: That's one where we may find a disagreement in. I have been-- I'm going to call myself a narrative bull in Bitcoin. You know the Bitcoin story well, and by the way, Raoul, for those who don't know, and I've mentioned it before, you're the one that turned me on to Bitcoin, and I want to thank you for that. That goes way back, that goes way back into 2016. You mentioned it to me in March of 2016. You sent me a chart and said, Peter, what do you think of this chart? I looked at it and go, I've heard about this crazy market. This chart is nuts. You turn me into an instant, one glance at the chart, bull in Bitcoin and of course, we had the big move, which I thought was really interesting because both you and I positioned ourselves very well in Bitcoin. We both took some off in 1000 and then we got the wrath of God from the trolls for a triple your money trade. I never could figure that one out. Nevertheless, the Bitcoin narrative makes sense to me. It makes me want to say, Bitcoin to the moon, $50,000 Bitcoin, $100,000 Bitcoin, but boy, is there a big caveat to that. The cabinet to me is that Bitcoin right now has every reason in the world go up. It's monetary supply, it's global uncertainty, it's all kinds of-- it's a strong gold market. It's a weak stock market. My goodness, if Bitcoin can't go up with what we have as a backdrop now, part of me as a technician wants to look for the shadows in the dark alleyway. I'm going, here's the market that really should be going up and it's not. RAOUL PAL: Look at the larger wedge. There's a large triangle wedge whatever pattern you want to call it. Now, could it go back down to retest the base of that pattern? Possibly. Now, that could be exactly where that would be, but it could be 3000, could be 4000, could be-- it depends where you draw the line, whether it's an upward sloping or flat version. That's possible too. PETER BRANDT: Very possible, and that by the way, there's a lot of people that criticize both you and I, because we periodically change our mind out in the [?]. We'd look at a market and we formulate an idea. You think a lot like I think, Raoul, and that is strong opinions weakly held. When we have opinions with strong opinions, it's necessary to have a strong opinion so we can carry a large enough position that if we're right, it becomes meaningful. When presented with new information, we have to reappraise. There are people who are dogmatic on positions, they'll go to their death with the position without changing their mind. While I'm nervous with Bitcoin, because I feel there are some things I see in the charts that are negative, it's not acting right, I also see the wedge that you see. I call it a symmetrical triangle, goes back to the December of 2017 high then you have the December of '18 lows, then you go up into the June of '19 high and then the break that we've had recently, and you have a huge symmetrical triangle. Should that symmetrical triangle, should we bottom in here, go back down to 4000, 3800 hold, start up, build something on the daily chart, then yes. Yeah, I know it comes across as real weird to people who want to be dogmatic in their thinking, but I have in the back of my mind an interpretation, a labeling of the Bitcoin chart that will take me one way or take me another way. I don't really care which way it is. RAOUL PAL: For me, I just look at that structure, understand the narrative, I look at that huge structure, the big triangle, and I'm like, okay, I usually know how these play out, particularly when I'm pretty confident of the macro and the fundamental and everything else. Now, the question is how does it play out on par? Often, it gut checks you once more than you want to be gut check in a pattern like that. Maybe it goes lower first. Significantly lower, maybe it only goes half as low because then you've got the idea, yeah, it's definitely going to retest, and then it doesn't retest the low. These triangle patterns tend to, as you've said before, they tend to morph in ways that frustrate you, but you just know that you're only operating within the context of a much bigger pattern. You'll have plenty of time to get it right. You can either try and buy it lower down, buy it in the middle, or buy on the breakout. Over the next time horizon, the probability of you being right, and it goes up is pretty high, depending on the time horizon. PETER BRANDT: Well, I think that's right. I pointed out to people like if you want to just have a very, very simplistic, technical approach to trading Bitcoin, just use a simple moving average. I don't know what it is, 14-day, 21-day, 30-day, take your pick, pick your poison because the reality is let's just say I use for timing sometimes an 18-day moving average. If Bitcoin is going to go from wherever to 20,000, 50,000, 100,000, trading it with a simple moving average is like paying a premium for the fire insurance on your home. You don't get your premium back, but what you're assured is if your house burns to the ground, you're covered. I guarantee you one thing, that if Bitcoin goes to $100,000, the 18-day moving average is going to spend most of its time in a profile. It's going to keep a person positioned to the right side of the market. You can just adopt some very, very simple technical indicators to say if I'm wrong and the 18-day moving average is pointing down, I'm not going to own it, or I'm not going to own as much of it, but you just adopt some very, very simple technical indicators that say, this is the insurance premium I'm paying to be long should the market have the increase that it could possibly have. I've always said about Bitcoin, I think there's a 50% chance it goes to 100,000 but I think there's a 50% chance it goes to zero. Within that parameter, how do I define a positive reward to risk profile trade? At Bitcoin at 6700, or wherever it is today, boy, 100,000 versus zero, and then you add some simple technical indicators, all of a sudden, you profile the trade that should be profitable or if not profitable, it's not going to cost you your home. RAOUL PAL: Yeah, exactly right. Peter, good. I really want to pick your brains and it's interesting, you and I are picking up much similar things across the markets and they're making us think about it. I think the most important one was the potential for this head and shoulders top in the equity market that nobody's really looking at. I look at early days, it's there [?] 2%, 3% today, who knows, but it came off the 50% level. It's possible, so we'll just see how it plays out from here. If I look at all of the evidence you've accumulated and I've accumulated, it's got a probability that somewhere, there is another top to come out of equities that could be even larger. Let's wait and see how it develops and we'll see if these other chart patterns are telling us the right story. We only know after the event. PETER BRANDT: Yeah, exactly. Then we can celebrate in Little Cayman together. RAOUL PAL: Exactly. PETER BRANDT: Well, stay safe. Stay safe. RAOUL PAL: I will, my friend, and stay safe in Arizona and hopefully, we'll get together somewhere in the world soon. PETER BRANDT: Okay, thanks, Raoul. Good to see you again. RAOUL PAL: Great to see you. JUSTINE: If you're ready to go beyond the interview make sure to visit realvision.com, where you can try real vision plus for 30 days for just $1. We'll see you next time right here on real vision.