As growth stocks continue to implode, comparisons are being made to the dot-com bubble in which numerous internet stocks collapsed following exponential price appreciation leading into the turn of the century. One trader has even gone as far as saying this time feels worse.
“Some of this carnage feels almost worse than it did in 2001 and 2002,” Dennis Dick, proprietary trader at Bright Trading and “PreMarket Prep” co-host, said Wednesday on Benzinga’s “PreMarket Prep.”
What To Know: It feels so painful because the selloff has accelerated over the last few days following dramatic declines over the last several months, Dick said.
“I don’t remember that acceleration back in 2001, 2002. This is death by 1,000 cuts,” he said.
Coinbase Global Inc COIN is a great example. The stock is down nearly 80% year-to-date, but it has fallen more than 55% in just the last few days.
“This is capitulatory selling on this thing here now,” Dick said. “And I don’t think Coinbase is a zero, but … who knows where the bottom is. You could have said capitulatory selling two days ago and it was $100, now it’s $62.”
Dick noted that there is upside opportunity in some of these stocks that are experiencing massive selloffs.
“If you are sitting with 100% cash, I think there’s eventually going to be a rip-your-face-off rally here sometime,” Dick said, adding that no one really knows when.
See the full segment below: