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You know I’m a bitcoin bear, so you know which of the following trajectories I think is coming. I have no material position, so I’m not “talking my book,” unless you feel that having negligible skin in the game is a position in its own right.
Bitcoin is for flight, but it would seem that Venezuelans no longer need to consider a fast exit, and the Iranian troubles that might shatter the regime appear to have come to a bloody ending – for now. So who is on the horizon that might need to consider going on the lam? To me, the answer is no one obvious, which in turn means bitcoin price weakness in my model given its role as the key driver of crypto prices.
So these are the two main scenarios:
Credit: ADVFN
On balance, there is more downside than upside, even if you are neutral. Of course, you have to believe in voodoo charts – but as someone who has been rewarded heavily for being a disciple, I take it as foundational.
However, the upside is certainly helped by the entropy coming out of the U.S., though the next leg of that seems to be Europe-focused, which would not elevate bitcoin.
Meanwhile, the focus of financial-market meme-chasing appears to have shifted from bitcoin to gold. Simply put, the FOMO mindset that has driven crypto for so long has landed in the precious metals arena. This is certainly a drain on bitcoin and will continue for an extended period, as gold is likely to remain exciting for a long time ahead.
The moon crew and their bags are now ogling instant “generational wealth” through a precious-metal lens, which is great for precious-metal stackers but not so great for the diamond-hand HODLers of bitcoin.
Credit: ADVFN
Meanwhile, the main risk in the markets is that the current U.S. geopolitical chaos will hole stock markets below the waterline. The equity haven for this is precious-metal proxies, but the mainstream won’t be able to hide so easily in crypto if the Magnificent Seven get damaged by a rupture in the Western consensus.
However, all this guessing will be pre-empted by the price action in bitcoin and gold, because those closest to the reality of what’s coming next will move prices long before they move headlines. I see metals up, crypto down.
So we draw our own lines in the sand and wait.