The DeCarley Perspective...Will volatility in metals and cryptocurrencies spill over into stock indices?

It has been my experience that when a few markets begin to break, volatility bleeds into others

It has been my experience that when a few markets begin to break, volatility bleeds into others. There are probably two factors at play: First, observing or experiencing pain and chaos in metals and cryptocurrencies alters how stock market participants perceive risk. Until now, equity traders and investors seemingly ignored risk, or at least downplayed it. Going forward, they might be less aggressive dip buyers or even opt to take profits to raise cash. Secondly, there is a good chance that margin calls from crypto and metals trades will consume the working capital of many portfolios, prompting traders to liquidate more stable assets, such as stocks, to cover losses or margin deficiencies in less stable assets, such as metals and crypto.