2021.37 - Change
TLDR:
Writing this newsletter every week for a year has been quite the experience. I will be making some changes. Thank You for reading and drop your email if you want to come along for the ride.
THE STANCE
My personal opinion on where the ball might be heading.
It’s been one year since I published the first edition of this newsletter, and a little more since I started helping others understand Bitcoin (which was well under $20k at the time).
A lot has happened in the span of this particular year and perhaps the most interesting things to see have been those that did not change through the turmoil.
As my conviction in Bitcoin keeps growing, my understanding of how to help others has evolved.
This will be the last issue of this newsletter on this format, if you want to learn about what’s coming next drop your email by clicking on the button below
LONG BITCOIN
Recent news that keeps me bullish on Bitcoin —"long / bullish" means you have the expectation something will rise in value.
Billionaires Bitcoining
Ray Dalio has been playing footsie with bitcoin for awhile now. He recently announced a small position but was still concerned that governments could stop it. I’m not sure if that’s changed but his recommended allocation to Bitcoin just got a zero added to it.
Howard Marks put in a solid appearance at The Investor’s Podcast. He explained that in 2017 —when Bitcoin first came to his attention— he came out strongly against it. But having spent some time with his son (who’s pro-Bitcoin) during the pandemic made him realize he didn’t understand it well enough to have a strong opinion. That is a skeptic stance that I can respect.
Institution Bitcoining
As is now customary, this week saw a few announcements of large institutional interest / position taking around Bitcoin.
Oh Whale
The market is moved by whales, but don’t take my word for it. In this long article David P Ellis —who has spent a lot of time analyzing BTC flows between different caliber players— he explains that whales still have an outsized effect on the market.
Well, the big players are buying. Are you?
ETF Pressure
One of the long expected detonators for a spike up has been a US-approved Bitcoin ETF, there are roughly a dozen queued up asking for authorization. You should have built your main Bitcoin position before this gets approved.
Satoshi Revealed
Hungary revealed the first public statue honoring Satoshi Nakamoto. Love to see it.
All Aboard
The onboarding process in El Salvador continues, it is heartening to see this precedent laid down.
CRYPTO WARS
crypto- | ˈˌkrɪpˌtoʊ | concealed; secret.
The monopoly over fiat money will not be given up without a fight.
Papers Please
SEC’s Gary Gensler wats crypto exchanges to register with the SEC. He has already hinted that they will apply pressure on them to de-list tokens that can be considered securities. Bitcoin is considered to be safe from this, and only a small handful of others, (your guess as to which is as good as mine).
SHORT FIAT
Recent news that makes me bearish on the legacy financial system —"short / bearish" means betting it will go down in value.
The Cookie Jar
No one likes to be Captain Obvious but this is not OK.
Several Fed presidents made investments on entities that the Fed proceeded to bail out. Now they are selling them “because ethics”.
Criminal? Yes. Novel? No. Consequences? Also no. Perfect top signal? Probably
Rent
“Why yes Karen, rents ARE rising in all 30 US metro areas, and yes it IS the first time they hit a double-digit rise but NO, inflation is under control and temporary, why do you ask?”
PRICE DISCOVERY
This is the section where I talk about price with an updated weekly price chart. If this is your first time here, there’s a “how to interpret” guide below the chart.
Guest Charts
Enjoy these two charts. I found the first one particularly intriguing as it suggests a higher floor than I would have expected (I would have said $30k)
This one just speaks to the fact that patience is key when buying Bitcoin. Yes, it can dip but we are currently not at the frothy levels where it will take years to recover.
Bitcoin Surfing
Price kept pretty close to the Water surface this week (currently $45.9k) and the Board has come up to meet price, hopefully giving it some footing.
The Sand level (at $17.1k) is slowly rising towards the previous all-time high. I think $20k Bitcoin is gone forever.
How to interpret the Bitcoin Surfing chart:
Think of Bitcoin's price-action as a kite-surfer:
Bitcoin uses its board to stay above water and wants to catch some air.
When it catches air, it tends to keep rising but if it rises too fast (it's feet no longer touch the board) it can stumble.
If it falls off the board, it tends to keep falling until it regains its footing (may need to touch water or sand for that).
Water and sand arrest the fall and help it push itself back up.
If it goes up so much that it gets close to (or into) the Stratosphere, it will probably crash down all the way into the sand and may need to tap the bedrock level before pushing up again.
Dip Fishing
Did you set a dip-fishing order at $44,500 last week?
If yes, good for you.
The fast average (blue line) is still below the slow average (red line) which means we are still in technically bearish territory (which we entered last week, see red circle in the closeup).
The markets seem to be somewhat on edge as China’s Evergrande meltdown continues to evolve. We’ll see if the Chinese government is willing and able to contain it, if you’re feeling bold you may want to set a buy order around $40k this week.
The Calm Chart
September looking pretty calm so far, perhaps gathering strength for end-of-year fireworks?
Take two deep breaths as you drink in the calm chart.
The strongest hands are built TOGETHER.
I help smart, busy individuals and their families develop the foundational understanding to invest in Bitcoin safely and confidently.
All it takes is 5 conversations.
