As I write this, the BitCoin 200 Weekly Moving Average is being tested as support. The good news is that the 24-hour BTC price has risen over 9%, to $3,580+ which demonstrates a strong initial reaction of support. I do not know if the 200 WMA is going to hold up over the next couple of weeks. If that support does not hold, there is not much support underneath it. If the 200 WMA fails, BTC price will certainly move to test $2,000 - where there doesn't seem to be much historical support...
It may seem crazy that the BTC price has broken down so badly in 2018, but don't believe the hype. Do not, "BUY! BUY! BUY!" just yet. One day with a 25% rise in price is a signal of NOTHING in cryptocurrency - except for the fact that it remains a tiny share of the overall markets and remains extremely VOLATILE. It could just as easily drop that much tomorrow or next week. BitCoin has experienced at least 2 major (85 - 90%) corrections in the past. So, this current plunge isn't anything new. I believe BitCoin will come back on very strong again at some point in the future, but it might take longer than many crypto enthusiasts are wanting to wait. That being said, I think that any BTC you can buy down around or below the $3,000 range is a good buy - even if it then goes down to $1,000. If you are considering entering into a big BitCoin position right now, I would urge you to only enter into a position with 1/2 of your current stockpile of cash. That way, if this ends up being just another dead-cat-bounce, you can buy some more at a lower price. Or, if the price continues to go up, wait for the 20 DMA to move over the 50 DMA before you buy into some more - at least then you are buying due to a very slight Bull signal, instead of hope-hype.
Checking the larger markets and the news cycle, the Dow Jones is looking like a "death cross" may occur sometime in the next week or two. There has been an uptick in volatility across several global markets and many foreign markets & asset classes have already signaled a death cross. The Trump corporate tax-cut effects are coming to an end, anticipation of rising costs means corporate inventories are at record highs, and the Federal Reserve is sucking liquidity out of the markets by raising interest rates - so there are going to be fewer and fewer buyers in the very near future. Short of a miracle, the stock market and the global economy is on it's way down. It's clear we have entered a Bear Market. Currency crisis, resource shortages, and economic depression are working their way throughout the various countries of the world and they are headed straight for the shores of the USA.
I think this will cause a "stagflation" event in the USA - where prices rise, people start getting laid off, the economy slows way down, and everything comes to a very slow crawl. Then, once everyone is broke and desperate just to survive, as various asset classes crash in value (for lack of investors), the banksters, wealthy, sharks, and fat cats will circle around the pool of chum to slurp it all up for next to nothing. Right now, I only have a small straw - but, when the time is right, I plan to suck on my straw like there is no tommorrow. Hopefully, I will be able to use my position in physical silver and gold to buy my first piece of land and buy or build a home. For the time being, I'm stacking precious metals while I still can.
So, why are the cryptos catching a strong bid right now? It is because the existing crypto speculators are thinking that current prices look too good to pass up? Or, is money leaving the stock market to seek out better values in other assets?
Gold and Silver are also going up today (but the dollar is taking a dive, so they should be going up anyhow). Is money moving out of stocks and into cryptos? Is this the beginning of "big money" buying-into an undervalued asset class? I don't know, yet - but I don't think so. We'll have to wait and see if the Dow Jones closes way down, again - or recovers by the end of the day. If the stock market continues to sag for much longer, the fear and panic-selling will set in. All of that money will start looking for someplace else to go. Some of it could well go into cryptos, returning the cryptosphere to another huge Bull Run...
Certainly. money will move into Bonds and precious metals. I think Bonds are not a wise move in the current environment, with the increasing uncertainty of the US Dollars' status as the World Reserve Currency going forwards. Precious metals are your sure, safe bet. Crytpos are a riskier bet, but the potential rewards (and losses) are greater.
Whether you're into precious metals or cryptos, it is VERY IMPORTANT that you take possession of your assets - either physical gold and silver, and/or getting your cryptos off of the exchanges and taking full possession of your secret crypto keys. Get your money out of any system or instrument which is based on someone else (a bank, a private vault, a brokerage) allowing or not allowing you to have access to your hard-earned money.
What are your thoughts and observations of what we are seeing? What do you plan to do to survive and thrive through the coming events?
DISCLAIMER: I am not a financial advisor. Anything in the above content is meant for educational/entertainment purposes only. Do not make trades based on this article. I am not responsible for any financial gains or losses you make in regards to this information.
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