The aftershocks of the AI fund blowup have yet to subside
Situational Awareness is scheduled to disclose its Q3 holdings on November 16. Its 439% first-half return came from using 4x leverage to make massive bets on SanDisk and Micron. The July AI stock sell-off triggered a 67% drawdown in a single month, and the bulk of its publicly traded stock holdings have already been transferred to Citadel.
After getting crushed by 4x leverage, the fund liquidated its positions. Most of the leveraged bulls in the AI sector have now cleared out. The crypto AI sector is under pressure too. When high-beta assets rally without volume backing them up, that’s distribution. Prices are grinding back and forth around a dense on-chain cost basis, while the exchange rate keeps weakening. The short-term trend is to spike and then pull back—don’t try to catch a falling knife halfway down.
When the holdings are disclosed on November 16, will you have placed orders to get out ahead of this TAO rally, or are you betting on a second leg up?
$TAO $BTC $ETH
Situational Awareness is scheduled to disclose its Q3 holdings on November 16. Its 439% first-half return came from using 4x leverage to make massive bets on SanDisk and Micron. The July AI stock sell-off triggered a 67% drawdown in a single month, and the bulk of its publicly traded stock holdings have already been transferred to Citadel.
After getting crushed by 4x leverage, the fund liquidated its positions. Most of the leveraged bulls in the AI sector have now cleared out. The crypto AI sector is under pressure too. When high-beta assets rally without volume backing them up, that’s distribution. Prices are grinding back and forth around a dense on-chain cost basis, while the exchange rate keeps weakening. The short-term trend is to spike and then pull back—don’t try to catch a falling knife halfway down.
When the holdings are disclosed on November 16, will you have placed orders to get out ahead of this TAO rally, or are you betting on a second leg up?
$TAO $BTC $ETH