Crypto: 2021 Thesis at bottom

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April 26, 2021

Crypto Update: No pleasantries. This is Crypto. Business up front, party in the back.

Bottom Line

Buy-  Decentraland (MANA),
Possible Buys- ETH, The Graph (GRT),CELO

Hold- BTC, LINK, ALGO,AAVE,BAT, ENJ, TRX, VET, XRP
Sell- REN

Legend:

Crypto (Current Price) [approx percent change since 27 Feb Update]


COIN
(Current Price) [approx percent change since 27 Feb Update]

BITCOIN:  ($53500) [~10%] MOST LIKELY BEHAVIOR

Next few days: Attempt to rally. Fail approximately $57,000

Next two weeks: Fall to the $43,000k range.

Assessment: HOLD: Move over ATH at 63K unlikely. Test of the key $43k level seems likely.

ETHEREUM:  (2440) [ 19%]MOST LIKELY BEHAVIOR

Next few days:  Break above ATH of $2600.

Next two weeks:  $2900

Assessment: POSSIBLE BUY– For risk takers, this has decent ST upside potential. Intermediate Term: HOLD Has tremendous LT outlook. Weak now.

CHAINLINK:  ($33.50) [25.3%] MOST LIKELY BEHAVIOR

Next few days:  Rally to 37.5

Next two weeks:  Chart indicates weakness, with $25 a probable bottom

Assessment: HOLD /REDUCE. Has tremendous LT outlook. Weak now.

The Graph (1.41) [44%]:  MOST LIKELY BEHAVIOR

Next few days:  Closed down to the bottom of its early March gap up. May attempt to break over its 50 day moving average at $1.72

Next two weeks: All depends on breaking 1.80. If it does that, should head to $2.25

Assessment: POSSIBLE BUY– only above $1.75. Aggressive- buy now. Bullish chart

ALGORAND: ($1.21) [50%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $1.50

Next two weeks:  Sideways

Assessment: HOLD /Sell. This chart is weak. Probably good for a ST pop, but that’s about all at this stage.

CELO: ($5.70) [40%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $6.50

Next two weeks: Watch for a pop!

Assessment: POSSIBLE BUY– If this goes over $6.50 on a 1 day basis- its going to run to at least $10. I think $13 would be a probable price target. Very bullish but not unless it confirms. A spike for a few hours above $6.50 followed by a fall isn’t confirmation!

AAVE: ($396) [-38%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $428

Next two weeks:  Watch for a break above 455.

Assessment: HOLD- A break over $455 will likely mean a run to $550. Chart is weak at this time.

DECENTRALAND: ($0.33) [300%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $1.50

Next two weeks:  Breaks ATH of $1.56 and heads towards $1.80

Assessment: BUY-  Ridden storm like a champ. Great chart

REN: ($0.60) [30%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $1. Will fail.

Next two weeks: Heading lower

Assessment: SELL– Series of lower highs and lower lows. Sell, now!

BASIC ATTENTION TOKEN: ($1.14) [NA / New addition]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $1.40

Next two weeks:  Probably will fail

Assessment: HOLD. For risk takers, Buy this has decent upside potential in very near term. Not recommending it unless your exchange allows Stop Loss orders.

ENJ : ($2.48) [500%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $3

Next two weeks:  Chart is showing this lower. Huge run up- scared retail investors.

Assessment: HOLD- Great LT future. Suspect a possible buy at $1.80 in next few weeks.

TRON (TRX) : ($0.12) [410%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $0.14

Next two weeks: Sideways

Assessment: HOLD. See VET note. This was recommended at 2 cents and has same retail panic / downside risk.

VE Chain (VET) : ($0.19) [1900%]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $0.22

Next two weeks:  Fall to .015

Assessment: HOLD– This has a great LT future. First recommended in Nov 20 at 1 cent. For now, its weak. Why? Because most of the retail owners bought in between 9 and 13 cents. They saw it pump to 28%. Felt like geniuses. Now are freaking out. See the movie Trading Places where Eddie Murphy explains the GI Joe with Kung Fu Grip explanation of pork belly futures. Go all in if this hits anywhere near a dime!

XRP : ($1.33) [Restarting coverage]  MOST LIKELY BEHAVIOR

Next few days:  Should attempt to regain $1.60

Next two weeks:  Probably sideways- but a move above $1.90 is a BUY

Assessment: HOLD– Dropped coverage when Coinbase stopped allowing purchases. Now appears the SEC lawsuit is likely groundless. If so, this moves to be a premium coin in the decentralized finance space. (DeFi)

Commentary (Party in the back): I do not believe we are yet at the stage of entering Crypto Winter. While the parabolic rally in BTC has ended, it doesn’t mean that the Crypto cycle is over. And it doesn’t mean that BTC is doomed in the ST. It may be messy for a month or two and then regain its legs. Nobody can tell at this point.

ALT Coins tend to rally as money flees BTC for Coins with momentum. Never forget that Crypto markets historically have had 3 major participants and recently a fourth one: 1. Whales that hold significant stakes, 2) Retail Investors (HODLRs) 3) Sophisticated traders using computer algos to essentially manipulate the short-term market and 4) The recent entry of Hedge Funds, Corporations and High Net worth clients. The #4 types will probably behave as Whales… meaning in the next year or two, the #3 types will actually have an easier time creating wild price swings since more coins will see vast sums of their potential trading volume get locked down into long term accounts. Good news, increasing participation of more and more Whales and HODLRs will someday reduce volatility. Of course, with that comes a reduction in gain potential. Crypto has never been for the faint of heart.

For those that profited significantly since Fall 2021:1.    Do not be afraid to take money off the table and send it back to your bank. It’s a good day when you are in it for house money and your bank has your initial, plus your Cap Gains payment plus some mad money in it!2.    Also, if you have more than $100k in holdings that you are going to HODL, consider getting a hard wallet. I use both Trezor and Ledger. I like both but am kinda hooked on the Ledger’s ease of use. Don’t be cheap- get the best one- it’s only $100 or so.

For getting in now: Be conservative. For the 10 we offered to back to $10k of losses and for the 9 we backed with Air Drops of some ETH, patience is the watchword

For All: Don’t ever get overly optimistic or overly bullish. You are positioned well, right now. Don’t be dissatisfied. Time and patience and attention are the allies you need to muster. BTC is basically what Cisco Systems was in 1991. The future of Crypto really lies to our front. Forget about the gains made by others in the past! Irrelevant. Some coins will be the next Blockbuster Video. Some will do just fine, but fail to impress over time. A few will be the Amazon, Facebook, and Google of the next generation of the internet. Remain un-greedy. Eyes wide open.


Never forget that I’m a blind squirrel that occasionally finds a nut! Your money is your business. My opinion is always suspect. All opinion has to always be suspect. The minute you start believing I know what I am talking about is about two minutes before your insolvency happens. Not my intent- but price action, not opinion rules any market.

May the Force be with you!

Pete

20210312
Team!
The Tech sector is getting crushed and Crypto is not. Especially not Bitcoin which is moving higher with strength. That is very unusual on a historical basis. A very bullish sign for crypto. Isn’t this reminiscent of when ET and Elliot disconnected in that old movie?
The assumption that Bitcoin moves are highly correlated to the higher-risk Tech Sector is now suspect. The correlation seems to be diminishing. I’ve long held the view that Bitcoin as “digital gold” was a daffy idea. Just rewind a year to March 2020… there was nothing “Gold” about BTCs performance back then. But, times may have changed. Maybe BTC is more a precious metal story than a tech tale. I am sitting with my Reeces Pieces watching with interest to see how this all plays out.

20210218
Team!
This is the promised Crypto Update. My strategy is threefold. First, I hold a core position in the three best coins (BTC, ETH, and LINK). Secondly, I have two speculative positions in VeChain (VET) & Enjin (ENJ) (not on Coinbase). My third strategy adopted this week is best described as a shotgun approach. I am buying small stakes in the cheapest coins on CoinBase.
Coinbase only accepts valid projects. It tries to minimize projects that might later become “sh$tcoins” in the colloquialism of coin traders. So, valid projects. My thesis is that these low dollar/coin projects will attract speculation. Some already have.

There is something fundamentally different between this rally in BTC and the ALT coins that weren’t present in 2012 and again in 2017-18. Blockchain was ridiculed for years. Laughed at by every legitimate investor & investment firm on Wall Street,.Now, it’s being embraced and going mainstream. PayPal, Visa, Bank of NY, Tesla, and others have moved into this space. Possibly there will become an institutional fear of missing out (FOMO).

The Wall Street Cheat Sheet definitely applies to Crypto. So where are we in the market cycle? I submit we are in the “Belief” zone with “Thrill” and “Euphoria” yet to come. I base that on where BTC is relative to its 2017 run. Using rough numbers, it moved over its 2013 All-Time High (ATH) at ~$2000 and ran to just short of $20,000 in 2017. Once it hit about $10,000 (a 5X move) new Crypto investors flooded what had been a quiet and fun trading space. By Nov 2017, I could hardly walk the halls at work without hearing a Bitcoin reference. It topped at about a 10X move over that previous $2000 ATH.

So far in this cycle, BTC has moved over its 2017 ATH of $$20,000 and is now about $47,000. That is a 2.25X move over ATH. If past is prologue, during this run, BTC will test $100,000 at a minimum. If it actually mirrors the last run, the top will be closer to $200,000. Sounds ridiculous, doesn’t it? But $100k is just 2.1X away and $200k about 4.4x from where we are now. A year ago BTC hit a low of $4000. It has the ability to make surprising moves. I believe my thesis that BTC can double at least once more this rally is not complete Fantasy Island.

Where do Alt Coins factor in? Well, when BTC enthusiasm swelled the market last cycle, the moves made by Alt Coins were truly epic. ETH went from $9 to $1200. XRP (not recommended to own) went from .006 to over $3.00. That probably won’t happen on that kind of Order of Magnitude this time, but I suspect the % gains of the Alts will be pretty awesome.

So that brings me to my “Shotgun Strategy” There is no way to legitimately do Fundamental or Technical Analysis of these coins (barring the extremely short term charting done by futures traders). It’s impossible to figure out a future stud from a future dud. I’ve decided to embrace them all and let the winners self identify. This strategy offends me. I always want to tip the investing scale via analysis… but I cannot do it in this case. Essentially I am building a pool or a Mutual Fund (so to speak) of coins on Coinbase. The only driver of my choices on CB was to focus on low price DeFi coins- you can build your own list of equally valid guesses with a couple of hours of work. The ones I am in / adding to are below.

I am not doing this on the other exchanges I use because I trust CB has a lot to lose by listing a verifiable “sh$tcoin”. CB has applied to become a publically traded company- the last thing they need as the SEC evaluates them is to have some coin blow up as a scam. Scam coins exist. This remains the Wild, Wild, West of investing.

Below is what all three of the strategies (para 1) look like in my portfolio. If you enter into crypto trading do so with your eyes open and know the risks are outsized in proportion to the potential gains.
Hope it’s helpful!
Joyfully!Pete


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