smaniscalco

BITCOIN (BTC/USD) is the Biggest Boom & Bust Asset of All Time!!

Long
COINBASE:BTCUSD   Bitcoin / U.S. Dollar
Hey Bitcoin Bugs!

Microsoft ( MSFT ), Facebook ( FB ), Apple ( AAPL ), and Amazon ( AMZN )...all have huge weightings in the stock market indexes...

On top of that, the Federal Reserve will share its latest policy decisions and guidance...

In other words, the next couple days will be extremely important for the markets... And we can't know how investors will react to the news...

So today, while we wait for the picture in stocks to clear up, lets look at an asset that's been soaring below most folks' radars – bitcoin ...

It's still down 35% from its 2019 highs. But it's up 69% in about six weeks, including a 20% rise in just the past week...

The price action is bullish ...

And we may be approaching a good time to buy. So if it isn't already, bitcoin should now be on your radar...

I'll explain why we're watching bitcoin closely. And I’ll even show you how to trade it...

As regular Crypto Wealth Coach ( VIP ) members know, bitcoin and cryptocurrencies in general aren't like other assets. While they have a lot of potential uses, they're not widely used in the current global economy...

Most of them are like new, unproven businesses in a new, unproven industry...

If the industry survives and thrives, the best businesses in that industry will likely be extremely valuable in the future... and the mediocre or bad businesses will fade away. If the industry doesn't survive, you'll just see big losses all around.

This makes cryptocurrencies extremely speculative. But that does not mean you should avoid them...

Bitcoin has quickly become one of the most incredible boom-and-bust assets in the world. From its 2017 low to its peak (and all-time high) that same year, it rocketed 2,267% higher. After an 83% drop to its late 2018 low, it soared 303% in about six months...

From that peak, bitcoin fell 61% to its recent March 16 low of $4,904. And now it's up 69% to about $8,300...

These are massive moves. And if you buy at the right time, you can quickly double your money or possibly much more...

With that in mind, let's look at the trends...

Here in CWC, we often use the 50-day moving average (50-DMA) and the 200-day moving average (200-DMA) to gauge an asset's intermediate- and long-term trends.

The longer-term 200-DMA moves slowly compared with the fast action in bitcoin . But when bitcoin has broken out above its falling 200-DMA (when the long-term trend was down), it was a great sign...

The intermediate-term 50-DMA, though, seems to be far more important for bitcoin . This trend line has served as an important support and resistance level for bitcoin over the past few years...

In the chart below, you can see the big booms and busts in bitcoin , along with its 50- and 200-DMAs.

Notice how it often bounces when it falls to its 50-DMA from above... And it often drops after rising to its 50-DMA from below. This makes breakouts (rising above the 50-DMA) and breakdowns (falling below the 50-DMA) even more significant.

Bitcoin broke above its falling 50-DMA at the end of last week. Now, it is pressing up to its falling 200-DMA...

This morning, bitcoin is trading higher again (around $8,300 at the time we're writing this). And bitcoin's 200-DMA is currently at $8,521. So it could jump above that level any day now.

The recent price action is bullish . But here's what we're looking for now...

If bitcoin closes above its 200-DMA for a couple of days, that may mark a big shift in its trend. The price action in bitcoin has been choppy over the past year. So a jump above its 200-DMA would likely bring in new buyers.

This would be a good time to start buying a small amount of bitcoin ...

If you would normally put $2,000 into a speculative trade, you could consider buying $500 worth of bitcoin . This way, you'll have some exposure if bitcoin soars higher. And you can add to your position if the price action continues to improve.

For example, you could add to your position if bitcoin closes above its February 11 high of $10,389. And you could buy more bitcoin if its 50-DMA crosses above its 200-DMA. Those would both be good signs that bitcoin is on its way higher.

That's the nature of boom-and-bust assets. And bitcoin booms and busts like nothing we've ever seen before...

For that reason, I recommend allocating no more than 25% of your investment assets to the cryptocurrency space... and possibly far less depending on your risk appetite. And whatever you do put in, know that it could go to zero. I don't think that's likely for bitcoin ... But it could happen.

Again, we're always watching bitcoin closely. And we may make a new, formal recommendation in CWC when the reward-to-risk setup looks good. As always, we'll let you know when the time is right.

Stay ahead of the masses,

Seth Maniscalco
Founder, Crypto Wealth Coach
Owner, Modern Wealth Management
Founder, Trading Resource Artificial Intelligence Network (T.R.A.I.N.)

http://www.CryptoWealthCoach.co

#NoMore925
#ProfitsOverPaychecks

Comments

This is 100% right..this is the good time to buy small amount. Thanks for this nice analysis.
+1 Reply
@kabbo12, My man! Please, if you would, share with your network so all can benefit!
Reply
kabbo12 smaniscalco
@smaniscalco, sure, i will try to do.
Reply
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