Don’t Buy A GPU Right Now: Prices Hit 6-Month Low In Global Markets As US Prepares For A Price Crash
Well well well, looks like the tide is finally turning. The markets are a fickle mistress and for the first time in almost a year and a half, the market looks like it might be preparing for a crash. Prices in Germany (3DCenter) have hit a 6 month low and Chinese miners are continuing to flood local markets with cheap, second hand parts. With the wider crypto market in a lul as well, the stage is set for a crash, making this potentially, the worst time to buy a GPU.
US GPU markets are primed for a long squeeze and price crash
China is a huge global market and the crackdown there, coupled with NVIDIAs introduction of LHR cards and the global cryptocurrency slump seems to have created the perfect conditions for a GPU price crash. As per data published by 3DCenter, prices in germany are down by almost 50% over the peak in May. On May 21, some cards were selling for as much as 304% the MSRP but have since crashed to a relatively more palatable level of 150%. In other words, prices of GPUs have basically halved there. You can see pricing data by German retailers below:
Retailers in the US, like Newegg and Amazon are currently showing no signs of a slump but since the global markets are connected - it is almost inevitable before arbitrage forces US markets to copy German and Chinese markets. Prices in countries like Pakistan, which made headlines due to their exorbitant price scalping direct from AIBs like Palit, are also showing a major price depression in the 20% range with the RTX 3080 Ti available for 300,000 PKR (1898 USD) (or 158% the MSRP) down from the standard 200-300% MSRP price gauging. Cards in second hand dealing forums are already down to 140% MSRP and still falling.
It seems to be inevitable now, barring a huge cryptocurrency comeback (I am looking at you Bitcoin and Ethereum), that the US markets are all set for a huge GPU price crash. Scalpers on Amazon have already reduced pricing of the RTX 3080 Ti from $2999 ( a ridicolous 250% MSRP) to a very slightly better $2499 (200% MSRP) since the start of June. This is a typical retailer tactic to incentivise purchases and is usually a sign of the beginning of a stock dump.
You can see the change in pricing of the ASUS RTX 3080 Ti at CamelCamelCamel:
This is where the advisory part of our article comes in. No one can predict the future, but all indicators available to us tell us that now would be the worst time to buy a GPU. The market is showing all the signs of overbought status and will likely correct very very soon. Retailers have already started dropping prices to incentivise inveentory depletion and here is our 2 cents: don't fall for it. If the trend holds, then in another 2-3 months you will see prices crash well below the 150% MSRP mark as the global markets arbitragey away inefficiencies in the US markets. All of this, is of course, assuming that the cryptocurrency market does not recover and boom (which based on its historical trend - is also unlikely - as it takes a couple of years for the bear phase to end).
Even if you have all that pent up money burning a hole in your pocket, it would not be adviseable to buy a GPU right now as you are going to run into some serious depreceiation if the crash occurs - something that could have been avoided if you had waited. Contrary to popular belief, there is a lot of pent up supply buffers with retailers that expected the high prices to last and as fear of being left holding the proverbial bag kicks in, they are going to offer more and more discounts to deplete their invetory levels. This is going to create a long squeeze situation which will reduce prices the more retailers start to participate in inventory thinning, accelerating the process. I would not be surprised to see the RTX 3080 Ti available for close to $1500-1700 USD in the US in a month or two.
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