Sell The Dead Cat Bounce?
In this update, I want to share my view on Bitcoin and Litecoin, and why I believe the next rally should be sold. In my latest update, I warned for a possible topping out of Bitcoin due to the vertical move up, see here.
Today, I want to share where we are now and what to expect for the next couple of days/weeks.
Let’s start with Litecoin vs Bitcoin.
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Litecoin vs Bitcoin (left) and LTC Chart 15min
The ratio LTC:BTC broke out above resistance, indicating LTC outperforms BTC. Trending above green support and in an uptrend, signals LTC might keep outperforming BTC in the short term, so I added a small part of my BTC into LTC.
The right side of the chart shows LTC 15 min chart, currently trading at $270, breaking out above resistance. Next resistance area 294-300. Target area if LTC breaks above 294/300 –> 320 –> 340/350.
A break of LTC below support $220 and I’m out for the short term.
Bitcoin vs Silver Parabolic Pattern
The left side of the chart is the weekly chart of Silver during 2006-2012, and the right side is Bitcoin, since the start of 2017. So far, the patterns play out almost identical.
Number 10 was the $11k low, BTC bounced up,, sold off and formed a higher low.
Now, if the pattern keeps aligning, then we could expect a run up into nr. 11: $16-$18k area. That seems like a nice opportunity to look for sell opportunities as the downside target for nr. 12 is at $10k = a 47% potential drop.
Longer term, as in after nr. 14, I will overweight cryptos again, to a max of 25% of assets. For now, I feel comfortable with a reduced crypto exposure (5% of total assets).
Short term, based on this pattern, I expect a Lower High for nr. 11, a dead cat bounce?
Total Portfolio Strategy
If you want to read more about my Total Investment Strategy, then please read this update first: 2017 Performance and Total Portfolio.
Or read my latest update on the US Markets: Dow Jones Industrial, Party Like It’s 1987!
This is what I will do over the next couple of weeks/months:
- I will add monthly to a mutual fund (worldwide stocks), as I expect stocks to skyrocket into the year 2030, peak of flight to private assets;
- I will add 2% of my assets to buy put spreads AEX Dec 2018, as a hedge for my equity exposure, medium term trade (12-24 months, 2018-2019);
- I will add 7% of my assets to to my 2018-2019 eToro hedge strategy: – Hedge US Stock Market for a 20%-40% crash
- I will contribute small amounts to interesting ICO’s and tokens that pay out a periodic cash flow;
- I decreased my crypto exposure from 20% of total assets to 4% of total assets;
- I will add to my short sovereign bond strategy (rising interest rates) when rates come down a bit into 2018.
Crypto Rating Desk and our ICO Portfolio of 100
ps. I started a new project, for and by my international students.
We analyze upcoming ICO’s and when we see a project that we like, we contribute. Our latest contribution is LHCrypto, a token that pays out a monthly cash flow, has a working business model and is active in a growth market.
We now have 14 contributions, and our goal is to build a portfolio of 100 tokens that generates a periodic cash flow (Portfolio of 100).
Feel free to follow our ideas: CryptoRatingDesk.com