WHAT IS BUBBLEWATCH?

The Short Version

A handful of mega-cap companies are pouring hundreds of billions of dollars a year into data centers, GPUs, and power generation, betting that artificial intelligence revenue arrives fast enough to pay for it. That single trade now dominates equity indices, credit markets, utility buildouts, and even memory semiconductor prices (see our companion project, GlutClock). When one theme gets this big, its cooling curve matters to everyone.

BubbleWatch is an open-source system that wakes up daily, ingests public market and credit signals — price momentum in the 22-name AI complex, crowding vs the equal-weight market, index concentration, high-yield credit complacency, proximity to 1-year highs, and crypto speculative appetite — compresses them into a single Bubble Temperature (0–100), classifies the market regime, publishes an out-of-sample 5-day direction forecast, and scores itself publicly against a permanent constant-0.50 baseline.

It is a thermometer, not an oracle. The point is transparent calibration and early warning, not trade tips.

Why Bubbles Follow a Readable Arc

Displacement ──► Boom ──► EUPHORIA ──► Profit-Taking ──► PANIC ──► Capitulation Trough
 (new tech)     (FOMO)   (temperature     (smart money    (broad-based   (best long-term
                           maxes out)     quietly exits)   liquidation)    entry zone)

• Melt-ups end in stages: Breadth deteriorates while the headline index still rises (equal-weight lags), then credit spreads stop flattering risk, and then prices finally break. The gauges track those stages in sequence.
• Concentration cuts both ways: Top-heavy indices mean passive index money mechanically amplifies whatever the mega-caps do — up, and especially down.
• Credit is the adult in the room: Equity investors can rationalize infinite narratives; high-yield bond investors demand cash yield. Spreads at record tights signify dangerous complacency.
• The fundamental reality check: Hyperscaler CapEx and Nvidia revenue growth. If CapEx growth decelerates while temperature remains hot, that divergence typically precedes breaks.

What BubbleWatch is NOT

Further Reading & Policies

• Plain-English Visual Guide — Friendly, visual breakdown with everyday analogies and an interactive temperature simulator.
• Formula & Technical Guide — Exact formulas, z-score methodology, and indicator rules of thumb.
• Under the Hood — Data sources, pipeline engineering, validation tests, and honest limitations.
• Legal Disclaimers, Terms & Privacy — Comprehensive regulatory statements, ML limitations, terms of service, and zero-tracking policy.