Crypto markets still offer potential wealth if played right | 10 April
BTC Bitcoin Price, Bitcoin Price Risk Analysis
(Previous week in brackets)
|Trend||↑ (↓)||↑ (↓)||↑ (↓)|
|86 (84)||88 (88)||71 (78)|
|Allocation Limit(0%)||Invested||0% (0%)|
10 April close: Bitcoin closed 5% higher on the week, which is a solid but not spectacular performance. New wave online products and Crypto have become a serious billionaires led industry where early (2011-2015) Bitcoin brilliance has already created enormous wealth for many and continues to do so today. The whales will not have a problem when the bubble bursts as they will be sufficiently diversified. The danger comes for millennials and many much older late adopters who are not otherwise diversified and protected with precious metals and a few more different commodities with a strong future. Crypto in Q1 and especially from March into April has shown explosive value enhancement with many fast growing tokens and altcoins performing in the >100% return category.
Crypto investment can be managed very profitably if greed remains in the background. This is very difficult however and at some point there will be competition as to who is first to unload. There doesn't appear to be any risk at this moment, at least not for Bitcoin as it is a trillion $ market, but one day someone with a very large position may want to switch some into fiat or another asset class. Right now, most non productive financial assets are changing hands at ever higher prices. Believe it or not, but this is 'Tulip Mania' and it will last until it doesn't anymore. Since Q3 2020 millions of new crypto exchange accounts are being opened every quarter worldwide and the direction is clear. UP and only UP as everyone starts buying into the whole spectrum of hot tokens . ..... Until the music stops. The message is simply don't be too greedy, take enough off the table and own some gold. Bitcoin remains much higher risk in our view than some of the newer coins based on a strong product led business. No Change.
3 April close: Q1 2021 was a major quarter for Bitcoin and most Altcoins showing some significant gains. Bitcoin 'only' and finally gained 95% for the quarter which was some experience with some large fluctuations along the road. This Long term picture is significant as we guage where this most popular of crypto's is going next. Because Bitcoin's price has hyperinflation characteristics, we show the log scale chart and the channel showing the upper resistance which at the end of 2021 is around BTC/$ 225,000.
Clearly visible on the Quarterly risk weight chart below is that Risk weight always peaked 1 or 2 quarters before a market price high was achieved following which Bitcoin always had a significant setback. On this chart we can see the first result for the new quarter which already has a potential to peak lower. This is important and different from the previous major bitcoin price peaks that occured in 2011, 2014 and 2017. As, especially smaller, investors become very active in the broader crypto space, the upside potential for Bitcoin generally looks less attractive.
This quarter-end week into Q2 saw Daily risk weight closing the gap with medium and long term risk weight and pushing the price higher after quarter-end window dressing. For practical purposes we end the week on Saturdays and the picture shows high risk. MOnthly Risk did turn up in the first 3 days of the month which offers 2 scenario's to match a similar picture as the previous 3 major price peaks.
Scenario 1 is a strong rally setting a new all time high anywhere between $62k and say $100k between now and June after which the market tanks.
Scenario 2 would be a volatile picture with net BTC price erosion into Q3 2021.
Both these scenario's have materialized in the past and are entirely feasible making BTC an unattractive
Bitpanda Pro - BEST Token Price Risk Analysis
(Previous week in brackets)
|Bitpanda - BEST/EUR||Monthly||Weekly||Daily|
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|82 (76)||88 (88)||53 (55)|
|Allocation Limit(variable)||Invested||100% (100%)|
BEST token live price
Bitpanda BEST analysis
10 April 2021: This weeks BEST performance was pretty strong with an 8% advance. BEST by the way, since its introduction in 2019 has outperformed Bitcoin by 250% to date.
The Coinbase online IPO and Nasdaq listing will be an exciting event to watch and already seems to be driving many token prices higher. Will it be 'buy the rumour sell the fact' or an unprecedented one way street to the moon. Fact is that this event alone will create enormous (paper) wealth relative to each individual situation, directly or indirectly, for many market participants and besides the existing Coinbase shareholders who will benefit beyond imagination. BEST, being the monthly 'rewards earning' token of this rapidly growing european crypto exchange should also benefit from this listing event as did BNB already last week gaining no less than 33%.
We remain fully committed with a virtually unchanged initial holding since H2 2019. Even though Weekly and Monthly risk weight are high, Daily risk is neutral and leaning bullish again. As we have seen so many times in different asset classes the past year, some markets simply ignore gravity and we need to be aware of those dangers. No Change.
3 April 2021: Bitpanda's Eco System Token (BEST) ended Q1 in style at €1.6001 compared with €0.1733 on 31 Dec 2020. A gain of 823% and as such becoming one of the absolute top performers in the entire crypto space. It did briefly touch €2,00 during a 2 minute low volume spell but that seems like an error almost. This strong performance also enhanced influenced our overall portfolio allocation to the extend that the crypto holdings have become a majority allocation pushing the precious metals down from 50 to 35%.
During the quarter we reallocated some paper profits into several smaller positions including, Polkadot, NEM, Stellar, Pantos (Bitpanda's Blockchain interoperability development token), MIOTA ETH and AVAX. Most of these tokens can now be traded based on our Short term, Medium term and Long term tools.
BEST's strong rally has also created a rapidly increasing fiat income stream from the rewards based on monthly volume trading, varying from 0.5 to 1% per month for investors. The basic strategy has been to take some rewards off the table every month for the past year at a Euro return equivalent to the BEST price received and to continue holding the core position.
The Crypto market as a whole is still a highly speculative environment and the aim of 'EyeforGold' is to allocate funds into crypto's with a strong business formula. Bitpanda is now the largest exchange in Europe with very strong financial backing. Primary markets we follow are listed here
April should be a very interesting month with at least 2 influencer events. One is the launch of Coinbase mid April where the latest target valuation has risen from 60 Billion to over 100 Billion dollars. That is staggering and as interest in this Public offering with a direct listing. Provided the listing is SEC approved a few things can happen. Existing shareholders may sell stock and benefit from the initial opportunity. The other is a massive interest and reallocation of broader Altcoins into Coinbase. BEST tokens can certainly benefit from a successful Coinbase launch whether immediately or later in the development cycle.
The second big influencer market event is Bitpanda's launch of fractional stock trading sometime in April as announces a few weeks back and making Bitpanda one of the very few pan-investment exchanges worldwide. For now Bitpanda's exchange is only open for accounts from European passport holders who need to be fully verified.
The PANTOS token PAN has seen 2 hikes out of the blue in March resulting in a monthly gain of nearly 200%. It almost suggests that someone has a hunch. The nature of investing in PAN is to support the development program and thus speculative although Bitpanda seems to be seeking a future monetary role for PAN as an instrument used to trade across blockchains. A small low risk punt if entered at current levels around €0,25 or lower. PAN briefly touched 0,31 last week.
S&P, Stock Indices, Equities, High Risk, No Limits
S&P 500 Standard & Poor's 500 Price Risk Analysis Forecast
(Previous week in brackets)
|Standard & Poor 500||Monthly||Weekly||Daily|
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|98 (98)||95 (88)||98 (90)|
|Max Allocation 20% (20%)||Invested||0% (0%)|
9 April 2021 close: S&P is one of those markets, like all equity indices that defy gravity. Technical analysis Risk turns out to remain extremely high which is why we cannot participate. This doesn't apply to individual stocks like Amazon and Netflix but the picture is still difficult to accept. There is also a fundamental reason which is a low growth economy coupled with a massive money supply increase most of which has gone into non-producing financial assets like stock buy backs which benefit only very few people. Again all time frames are now in very high risk territory and the picture of late has been that only minor bullish divergence from shorter term timescales versus their longer term bro's is a reason to call another rally. The Robin Hoods of this world also put fuel on the fire and the outlook becomes truly unpredictable. With much more public engagement in financial products, serious inflation, which wasn't much an issue before with all this hot air money creation, will be coming into the picture this year. It is already in crypto, real estate and equities. No Change.
2 April 2021 close: There is no doubt that we have missed this entire market and unfortunately we are dealing with highly unusual monetary circumstances that keep moving massive amounts of dollars and equivalents into company equitiy. It is a totally free ride, yet our tools kept telling a different story. The beginning of the new month is no different. Everything is in overbought territory building another bearish divergence case in most most individual time scales. A mild short term bullish divergence between short and medium pushed S&P index prices higher by 1.6%, which in itself isn't very eventful either. It is the same with Precious metals which we own to protect, but becoming almost boring to own whilst the attention is on Crypto and with Non-Fungible tokens becoming the hottest tradeable items in the industry. Very hard to understand for most people.
An entirely new financial world is being created that has become near impossible to regulate because it takes even more years for national and international authorities like Central Banks to put all this into perspective.
As MMT is officially embraced by the power players, the outlook and timing of changes for our monetary system are impossible to predict. Our party line remains Precious Metals and the primary choice for protection whilst embracing the world of Blockchain which develops at the speed of light, with strong security and privacy protocols. It is unstoppable.
26 March 2021 close: S&P looks technically strong on Daily and Weekly charts. Risk weight has turned up and we should normally expect a new ATH the coming week. Long term risk weight is high as ever and as shorter term time scales meet up with Monthly this market is still at risk against all ods of starting a major downtrend. Equity indices simply do not offer a strong incentive. A little boring even. The broader market is supported by unlimited QE which is still the only safety net in our opinion. And that is high risk. No Change.
Brent Crude oil Brent Crude Oil Price Risk Analysis Forecast
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|84 (83)||68 (72)||42 (39)|
|Allocation Limit(10%)||Invested||0% (0%)|
9 April 2021 close: The Brent Daily chart seems to develop some kind of ABC correction and may hover in a 60-70 handle range for a few weeks. There is some short and medium term upside still whilst long term Monthly risk is reaching an overbought condition. So, the bias is more towards the upside short term, but this market is now less predictable and therefore less attractive to participate. Only very clear divergence signals can trigger fresh participation. Short term tight stop trading is a better option but not for longer term risk-on participation. No Change.
2 April 2021 close: The new month has yet to start as we closed a short week in oil markets. The first April tick pushed Monthly risk weight up a bit, whereas Weekly has turned dowen with Daily in a neutral position. The 70 handle was touched on March 8, held in a 65-70 range for a week and then dropped sharply. The market still doesn't know where to pitch whilst a battle fore and against fossil fuels is going on in most Western Politcal debates.
With Weekly time scales showing massive risk to price bearish divergence on the 46 handle peak in August last year and the recent 71 handle peak this asset class is a relatively high risk where shorts should do better than longs technically spoken. Commodity price inflation may also develop a fresh advance in the near future. No change for now.