Crypto - Temporarily selling everything — 21st Sep
Temporarily selling all positions into USD. This could be a medium-term turning point for the market and Bitcoin may fall to mid-30’s
I am by no means suggesting that this is the end of the bull run. Macro we are still bullish and we will re-enter the market, but we may churn until the end of the year before making new all time highs. For example:
BEFORE
AFTER
Let’s look at why we’re selling here.
Bitcoin is printing a similar fractal to the May highs before the spill.
After a great run Altcoins and are now showing signs of weakness. Total2 (everything except Bitcoin) is breaking down. If bitcoin falls, our Altcoins will fall even harder
Bitcoin Dominance reached the significant 40% level. It has already started to bounce and I think it has more to go. This usually suggests either a very strong Bitcoin (and weak Alts) OR a market sell-off.
The retail Fear & Greed index (our counter indicator) is Neutral. That isn’t the best for our bear scenario. Ideally we want to be bearish when retail is greedy however, retail isn’t fearful so this isn’t a bullish sign either, something to note.
How are we wrong?
If the H&S fractal above fails and moves up we re-enter all positions.
Yes we’ll lose out on making some money, but the downside risk is much greater than the upside potential. It’s a lot better to be early and wrong than late and wrong. We don’t want to put ourselves in a difficult position where we have to sell after a big spill.
Of course I’ll update you if that happens.
Talk soon,
Yao.
