An 835% single-day surge in a stock that had already lost nearly all its value — here’s an interview with Chief Market Analyst Steven Hochberg where he breaks down the NewBird AI frenzy —and what it reveals about the current psychological environment in markets:
Hi Steve, you wrote about a company called NewBird AI in the latest Elliott Wave Financial Forecast. Can you summarize that for our readers?
Sure. Allbirds is a sustainable sneaker company — to be clear, their sneakers may have been sustainable, but their business model wasn’t. So, they announce that they’re abandoning the shoe business to become an artificial intelligence company. The company rebranded as NewBird AI, and the stock rocketed 835% in a single day and then plunged. Keep in mind, this was a stock that had already lost 99.6% of its value from its 2021 peak. One press release, and suddenly everyone wanted in…for a day!
That sounds insane.
Right? We saw almost the exact same thing in late 2017, when Long Island Iced Tea Corp. changed its name to Long Blockchain Corp. Investors drove the shares up 289% in one day. At the time, we told Financial Forecast subscribers that the name-change frenzy captured the fearlessness of bitcoin investors — and we called for a decline in bitcoin’s price. The crypto dropped 84% over the following year.
So, the name change itself is the signal?
Yes. It’s not about the company. It’s about what investors are willing to believe. When a dying business attempts to resurrect itself overnight by attaching to a hot theme, like crypto or AI, it tells you something important about the psychological environment. There is no analysis. Investors are chasing whatever’s moving.
And NewBird AI followed the same script as Long Blockchain?
To the letter. The stock surged, then reversed hard, falling 73% over the next ten days. These are skyrockets — spectacular on the way up and then a quick flameout.
What does that environment tell you about the broader market?
It tells you to pay attention. When you see this kind of behavior — investors rushing into anything with an exciting story, in this case, a dying company rebranding into a hot sector and gaining 835% overnight — that’s worth noting. The Long Blockchain episode happened right at the peak of a mania for cryptocurrencies. NewBird AI has the same fingerprints. And these events tend to show up when speculative spirits are running at fever pitch. The Wave Principle provides a framework for recognizing shifts in psychology before they show up in the headlines.
Read the Latest Issue of The Elliott Wave Financial Forecast Now.
Steven Hochberg and Peter Kendall have analyzed markets through every mania, crash, and recovery of the past several decades — drawing on historical data that stretches back centuries. When speculative behavior reaches the kind of extreme described in this interview, investors should pay attention.
The Elliott Wave Financial Forecast delivers their full market analysis every month: where the Wave Principle says we are, what likely comes next, and how it can help with your decisions.
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Steven Hochberg Chief Market Analyst
Steven Hochberg’s analysis keeps subscribers ahead of the trends in U.S. stock indexes, as well as global indexes, bonds, precious metals, the U.S. dollar and the economy. He co-edits our flagship monthly Elliott Wave Financial Forecast and edits our Monday-Wednesday-Friday Short Term Update.
One of the world’s foremost experts in Elliott wave forecasting, Steven is a sought-after speaker interviewed numerous times for his market views by Barron’s, Bloomberg, CNBC, MSNBC, Los Angeles Times, Washington Post and other media outlets. Steven began his career at Merrill Lynch and joined EWI in 1994.
