Trading expert predicts 50% crash for U.S. stock market

Ali Martinez, a popular on-chain trading expert on X, speculated late on Monday, April 7, that the U.S. stock market is headed for something of a false rise in the coming months before suffering a catastrophic crash over the course of several years. 

Specifically, the chart the analyst shared in the social media post appears to highlight an observed similarity between the S&P 500 chart in 2026 and in 2007 in the lead-up to the Great Recession.

Martinez highlighted that the pattern that led the benchmark stock market index to its 1,576 high 19 years ago is almost a mirror image of what is observable in the most recent 12 months. He also highlighted that the 2007 rally led to a collapse that took the S&P 500 57.68% lower to the 2009 bottom near 667 points.

Thus, the on-chain trading expert extrapolated that, should the pattern truly be a repeat of the Great Recession’s prelude, the index could rally to 7,150 in the coming months before plunging 56.22% to 3,130 by, presumably, 2028.

While Martinez’s analysis came with little in terms of reasoning or explanation other than the apparent pattern similarity, it fits within the widespread fears that the U.S. – and global – economy is headed toward a catastrophic financial crash.

How Great Recession recovery set the stage for a new crisis

One of the popular structural issues emerged from the long period of financial stimulus in the form of near-zero interest rates that allegedly enabled the multiplication of so-called zombie companies: firms that would have long gone bankrupt without access to exceedingly cheap debt.

Such corporations are generally seen as harmful for the economy as they tend to drag productivity down while crowding the space and, thus, siphoning money and attention from healthier businesses.

U.S. National debt fears mount almost as fast as the burden itself

National debt is another frequently discussed risk factor, as it has, by press time in April 2026, crossed above $39 trillion, 27% higher than the latest annual nominal gross domestic product (GDP) of approximately $30.6 trillion.

While the rate of debt-taking is widely seen as unsustainable, especially should the growth of the economy slow down, and despite President Donald Trump running on a platform of reducing the deficit, the commander-in-chief is now forecasted to add $7 trillion more in the next 10 years from the military budget alone.

The figure would come on top of other spending and follow the nearly $3 trillion taken during the first 14 months of the presidency.

Is big tech about to bring the economy down?

Elsewhere, the technology sector and especially its focus on artificial intelligence (AI) are also seen as potentially dangerous. Big tech is facing mounting criticism over its monopolistic practices, while often seen as increasingly creatively bankrupt.

Meta Platforms (NASDAQ: META) is often seen as the prime exemplar of this trend, due to the failure of the Metaverse, its role in the Cambridge Analytica scandal and related data harvesting operations, and the fact that most of its successes in the last decade have been the result of simply purchasing promising startups and potential competitors.

Simultaneously, the ongoing AI boom is itself seen as a major risk factor as it is siphoning hundreds of billions in investments despite remaining unprofitable and facing setbacks in terms of infrastructure, given the vast mismatch between the number and capacity of data centers announced and those that are actually even close to beginning construction.

AI can also be seen as driving a mounting demand-side issue, considering that, despite billionaires such as Elon Musk claiming the ultimate goal of the technology is complete abundance, it has been variously a driver of and an excuse for massive layoffs.

Indeed, by 2025, the length of job searches has become an increasingly hot topic with growing accusations that companies are making fake job postings, allegedly to imply growth where there is none and mislead potential investors.

Geopolitics and the 2026 financial crisis

Furthermore, geopolitics has turned into another major reason why many experts are forecasting a significant downturn. The ongoing Iran war has led to the closure of one of the most important waterways in the world, and has put much of the world’s heavy industry at risk of destruction.

While most investors and other observers have been focused on oil, it is noteworthy that fertilizer, helium, LNG, aluminum, and the supply chains for many other critical inputs are equally at risk.

Similarly, the risks are heightened by the fact that supply is unlikely to quickly return to pre-war levels even if the Strait of Hormuz is reopened, as various facilities have been heavily damaged and others have suspended operations and will take weeks or months to restore their capacity.

‘Big Short’ Michael Burry already identified 2028 as major crisis year

Lastly, while a 50% drawdown by 2028 might appear extreme, Ali Martinez is not the only analyst to forecast a substantial crash. For example, the ‘Big Short’ trader Michael Burry also discussed at length how the various new trends in the stock market have created a series of structural risks.

The legendary ‘winner’ of the Great Recession also warned that the next financial crisis could see the S&P 500 declining more than 50% while highlighting another long-term risk: he anticipates that, by 2028, many index funds will see unprecedented outflows as more and more Baby Boomers retire.

Burry is also a critic of the impact index funds have on the health of the stock market, as they effectively remove price discovery from the equation, leading to many assets trading higher as a direct result of trading higher and unrelated to the health of the underlying businesses.

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