The hero of the movie “The Big Short”, Michael Burry, decided to delete his Twitter account after posting a cryptic market prediction before the Federal Open Market Committee (FOMC) meeting.
Michael Burry’s tweet, which consisted of a single word, “Sell,” was shared ahead of an immediate reversal in the crypto-currency and traditional markets after the Federal Reserve’s announcement of a 0.25 percent interest rate hike.
Michael Burry’s tweet may have been a signal to investors to take profits, especially in the overheated crypto-currency market after the short-term reversal that began in January, and prepare for a potential market correction. His reputation as a hedge fund manager who correctly predicted the 2008 housing crisis has added weight to his predictions, causing many investors to pay attention.
Crypto-currencies’ reaction to rising interest rates
Bitcoin was up more than 3.5 percent within hours of the rate hike. Other major crypto-currencies, such as Ethereum and Binance Coin, also saw significant gains.
Michael Burry’s decision to delete his Twitter account after posting his cryptic market prediction has sparked speculation in the financial community. Some believe that he may have deleted his account to avoid the excessive attention of bullish investors, while others believe that he may have simply lost interest in social media, as he has already deleted his account and all of its content numerous times in the past.
Some analysts see the regulator’s action as dovish, despite Jerome Powell’s stance of not stopping the rate hike cycle. Regardless of a series of steady 25 basis point hikes, the market should remain bullish as long as no unfavorable macroeconomic data is unexpectedly released.