SOFTBANK: Boom Or Bust?

In 2022, I posted several articles on SoftBank's (SFTBY) reckless business investments and failures, which can be found at this link.

I'm not convinced that their new AI partnership with "Stargate" members will prove to be any more profitable for them than those, which were not...or that their investment will be any more wise than the others, which were not.

Time will tell.

Source: ZeroHedge

This venture may be SoftBank's biggest black hole investment yet..."no clear goal, no timeline, and no real way to measure it" also means no transparency...buyer beware.

Source: Slope of Hope

Overlayed on the following monthly chart of SFTBY are a number of technical drawings depicting a long-range rising channel, a "chaos zone," and a "froth zone."

The current price is currently trading in the upper portion of the "froth zone" and is at the top of the channel.

Failure of price to rise and hold above the upper levels of the "froth zone" and channel at 35.00 could see some volatile swings in either direction within this zone, until it becomes clearer to investors as to the viability and sustainability of SoftBank's latest capital venture, described above.

* UPDATE February 12...

The following X post is not good news for SoftBank.

As I write this update at 1:18 pm ET, SFTBY is trading at 30.76, down from 33.90 since January 23.

It seems that others are also concerned over SoftBank's investment decisions.

* UPDATE July 22...

Unless this AI partnership can withstand decades of heavy financial losses before any profits more than cover them, if ever, I'd say that SoftBank's investment is on the way to BUST.

Source: ZeroHedge

Source: ZeroHedge

"Klepto" Cryptomania Crashes

* See UPDATES below...

If market players ( e.g., SoftBank, BlackRock, and many others) were addicted to insane risk, they would have invested in crypto currencies and exchanges...which are in absolute freefall today.

It's just a matter of time before these klepto ponzi schemes hit rock bottom...what a hot mess!

Source: ZeroHedge

ZeroHedge excerpt

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Link to tweet

N.B. ⬆️⬆️⬆️

Link to tweet thread

Link to tweets

FTX Token (FTT/USD)

* UPDATE Nov. 9...

Things could get very ugly for FTX's Sam Bankman-Fried...what about facing an investigation for fraud, for one thing...

CHART OF THE YEAR: We(Didn't)Work 😕

WeWork (WE) is on its way to zero...who bought it at 14.97?🤔

SoftBank (SFTBY) invested $17 Billion in WeWork, according to this October 2021 Bloomberg article...and we know how SoftBank has fared. 

Since my post of August 8, SFTBY closed lower at 17.95 last Friday. As I reported, failure to hold above 16.00 could see it plummet in short order to 10.00, or lower.

SOFTBANK: Hooked On Bubbles

* See UPDATE below...

Over the years, I've posted numerous articles on equity bubbles bursting, at this link.

I can add another one to the list...Japanese SoftBank Group Corp. (SFTBY).

Source: Wikipedia

As shown on the following monthly chart, SFTBY hit its all-time high of 50.00 in February of 2021 and began its plunge the next month. It lost over 60% of its value by May 2022.

There has been no sustained advancement above its near-term support at 16.00 since its IPO in 2010.

Failure to hold above 16.00 could see it plummet in short order to 10.00, or lower.

SoftBank's reckless business investment risks and failures are described in the following article...

Source: ZeroHedge

* UPDATE Aug. 13...

"...we had our heads in the clouds."

So, will that ailment be transitory, or permanent? 😏

Source: ZeroHedge

ZeroHedge excerpt

Bubbles are meant for baths! 😏

Alibaba Ensconced In Chaos Zone

Alibaba (BABA) has plunged into what I call a 'Chaos Zone,' as shown on the following monthly chart.

As you can see, it's nearing its IPO price of 92.70 in September 2014, after reaching a high of 319.32 in October 2020.

The following article mentions a scenario that may occur.

Source: ZeroHedge

Before we see that happen, if at all, we may see BABA drop somewhat further on this rumour, then reverse sharply and possibly retest the 160.00 level, or thereabouts. I'd look for a large volume spike, together with an extreme ATR print (based on a value of one period, as shown), to confirm such a V-bottom reversal had occurred at a lower price level.

It may be that, during such a reversal to the upside, SoftBank begins to dump its shares, in which case, we'd likely see volatile price moves in both directions...possibly within the upper half of the 'Chaos Zone,' or around the 120.00 level. Price may spin around 120.00 ('thread the needle') before it moves erratically higher toward 160.00.

Failure of BABA to move and hold above 160.00, on increasing volumes, may signal much further weakness ahead, with price, ultimately, retesting 80.00, or lower.

So, there is a lot of room for wild price swings to occur within BABA's 'Chaos Zone,' along with the release of wild rumours about SoftBank, or something/someone else.

Buyer beware!

P.S. SoftBank's own stock (SFTBY) has dropped considerably from its 2021 high of 50.00 and is mired in its own 'Chaos Zone,' as shown on the following daily chart.

It's in solid downtrend and is still under the bearish influences of a moving average Death Cross that formed in mid-2021.

A drop and hold below 20.00 could force a retest at 17.5, or lower at 15.00. 

A drop and hold below 15.00 could prompt its sale of some or most/all of its stake in BABA, as described above...or, even as soon as a break and hold below 20.00 on increasing volumes.

The monthly chart of SFTBY shows a macro view of price action, the 'Chaos Zone,' and other major support and resistance levels.

Watch for any extreme spikes in the volume and the ATR indicator (shown with an input value of one period) to, potentially, verify a trend reversal after any further plunge lower in price on this timeframe...particularly if it breaks and holds below 20.00 with force.

The following daily ratio chart of SFTBY:BABA shows that there has been a whipsaw struggle for relative strength between the two since mid-2018.

This ratio has been trading in its own 'Chaos Zone' since the beginning of 2021.

A rapid plunge on this ratio could spell big trouble for both stocks. A drop and hold below 0.150 could be catastrophic for both, so keep an eye on this.

In any event, they're both weak and mired in their own 'Chaos Zones.'

Expect volatile churn to continue until we see clear breakouts or breakdowns and holds, with conviction...on BABA, SFTBY, and SFTBY:BABA.