Is it Time to Take a Bite Out of Bitcoin?

The Entry Points

Cryptocurrencies are either loved or hated by so many people – meaning lots of emotion/opportunities. On the chart of Bitcoin , you can see the rally so far from the selling climax (big arrow). And knowing that a selling climax usually leads to (is a precursor to) a very big rally, that is/was then my belief – that there was a rally coming (little arrow) – and it was quite a rally. There was also a “spring” of the support area. This technical work is effective in any liquid market. Keep in mind the huge rally these things had just from the lows in May.

Back in the late 90’s almost everybody started to believe that the internet would take over the world, and they were right. The mistake was, and this terrible blunder is constantly repeated in markets, to then transfer that belief straight into a market. Like the gold permabulls always finding a reason (excuse) to buy gold, and usually at the worst possible times. They’re taking the exterior data theory, and plopping it straight into gold. But gold has a price, and that price moves around. They’re dealing with other stuff (predicting). Deal with gold first.

So in the late 90’s thru 2000, people used this general exterior data theory, and sucked up all the tech stocks – because they were bullish on the future of the internet. What a mistake. The internet is not a market, it’s a “thing”, so they dealt with the thing, and not the market. And now we have this “thing” with the cryptocurrencies, and this thing will survive, but in what form. So using the example of the tech boom, “block chain” is sort of the internet, so to speak. It’s the technology. The term cryptocurrencies is like the tech stocks as an entity. And each individual cryptocurrency would be like a tech stock, Intel for example. But the currencies are the things which are traded, not the block chain. The currencies move up, and yes they move down also. And the most recognizable cryptocurrency, Bitcoin, might be like Cisco. They had a tough time for many years, but Cisco is still around, the internet is still here, and is stronger than ever. Of course the tech stocks are still here also, but not every one of them made the journey.

 

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About traderscott 1146 Articles
Trader Scott has been involved with markets for over twenty years. Initially he was an individual floor trader and member of the Midwest Stock Exchange, which then led to a much better opportunity at the Chicago Board Options Exchange. By his early 30’s, he had become very successful in markets, but a health situation caused him to back away from the grind of being a full time floor trader. During this time away from markets, Scott was completely focused on educating himself about true overall health and natural healing which remains a passion to this day. Scott returned to markets over fifteen years ago where he continues as an independent trader.

7 Comments

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