Crypto Newsletter March '24
New all-time high for Bitcoin, ETF setting records and In-Person event for April 2nd!
This newsletter covers current headlines within the crypto space, my opinion on them and projects & people I find interesting. Also included is information about important crypto community events both locally & globally. Opinions shared within the newsletter are my own and do not constitute investment advice.
Howdy crypto-heads, the crypto markets are still looking strong and if you’ve been in the space for awhile you know it’s times like these to make sure all your ducks are in a row (what an odd metaphor…)
Every up cycle always brings out the scammers, and with each new ATH they get more and more sophisticated. This is why personal cybersecurity and self-custody are so important - they allow you to sleep easy and make sure your crypto is always right where you left it! If you are anxious or just want to learn about best practices for keeping your crypto safe you’ll want to attend our next Denver Crypto Group event on April 2nd.
Here’s whats on deck for the March Newsletter:
Bitcoin ATH and Aftermath
Wallstreet Claws into BTC via ETF
In-person Event for April 2nd
1. Bitcoin Carnage at All-Time-High
If you’ve been seriously trading any type of market you are likely familiar with the phrase, “Don’t try to catch the falling knife”. What this means is when a market is strongly trending upwards, there will be small pullbacks that offer profitable opportunities, but predicting the level at which the price reverses, stops falling and then starts going back up is about as dangerous as trying to catch a “falling knife”.
While the allure of this type of trade is often enormous, keep in mind that you’re going to have a LOT of competition and whales and market makers will be eager to wipe your trade out if they can.
This recent Bitcoin chart shows exactly how tough it is to time the markets. Basically, if you don’t already have defined price points PRIOR to the fall, you’re likely going to lose your trade. So in the above scenario for March 5th, you would need to have a market sell order right around the old ATH near $69k, and also have a stop-loss somewhere above that (maybe $72k?) and then have your take-profit level right under $60k. Without all 3 of these price points pre-defined ahead of time, most likely you’d be on the losing side of catching this “falling knife”.
So why am I harping on this so much? Well, I believe that Bitcoin (and crypto in general) are going to be around for as long as we have a free and open world wide web. As someone who used to make big risk trades, the lesson I’ve learned has been…wait for it…just don’t.
Accumulation via dollar cost averaging (aka regularly buying a little bit here and there and primarily holding for long term) has been the strategy that’s benefited me the most as well as a large number of people in the Denver Crypto Group.
As Bitcoin makes new all-time highs everyone wants to make the most of the opportunity (we’ve had to wait almost 3 years for goodness sake!), but I’m here to tell you that patiently accumulating, while being somewhat boring, is the strategy that anyone can pull off and is most likely to pay off in the long run, assuming that getting your hands on the most Bitcoin you can is the primary strategy you’re going for.
Bitcoin Price Movements (Trade at your own risk)
If you do intend to trade these choppy markets (and ignore my opinion from above) I do have some thoughts on where BTC may be going. Please keep in mind however that these are just my best guesses, and also, with the new all-time high in Bitcoin, determining the next levels at which we may reverse or at least slow down becomes increasingly difficult the farther away we get from the last bull markets ATH around $69k.
Using some Fibonacci extensions is my go-to in these situations, and so I’ll be watching $87k as this is the 1.618 extension based on the previous ATH’s in 2021 and 2017. After that I think the $100k psychological level will be our next stop, and who knows what happens if we get over that!
For retracements, it looks like strong support at $57k, the psychological level of $50k and under that $42k for potential bouncing or reversal levels if the price continues to head down.
2. Wallstreet Claws into BTC via ETF
Now that traditional investors are able to gain exposure to Bitcoin via spot ETF’s, the appetite for these more regulated and familiar Wall St. products has been nothing short of tremendous.
Over $12B of inflows have occurred in the two months since Bitcoin spot ETF’s were approved, firmly putting Bitcoin ETF’s in the top 10 of all stock market products being purchased, at least for 2024.
While it remains to be seen if this rally will continue deeper into the year or not, currently there is quite a lot of positive sentiment around Bitcoin and it’s potential appreciation.
On the other side of the “risk” coin however is a lightly-researched personal opinion I have - With the introduction of Bitcoin products more widely into the stock market system, we will see the major market makers more frequently manipulate the BTC price for their benefit.
If you’ve been following the price action of gold for any length of time, it certainly seems like the upside potential has been suppressed (or maybe I’m just bitter hah) and I’ve heard theories that the gold market is very tightly controlled by large institutional players.
I also believe that the introduction of Bitcoin spot ETF’s is probably just the beginning of Wall St.’s foray into the cryptosphere, and as more derivative products hit the market and enable the paper trading of Bitcoin without having to own the actual underlying, scarce-by-design asset, that it will be increasingly easier for the big investment firms to push the price around.
If you are a stock market expert (I am not) and this theory is mostly hot air, please let me know! I’m always trying to learn and the effects of the Bitcoin ETF on the price discovery of the largest cryptocurrency is something everyone should be concerned about.
3. Bull Market Preparation on April 2nd
If your portfolio is growing to a point where it is potentially life-changing, why aren’t you locking it down to ensure it’s safe and ready for you when you need it?
Every time the crypto markets up cycle I receive a wave of calls from folks panicking about having their crypto on multiple exchanges and low-quality wallets, and asking how quickly I can help them set up a secure, safe home to park their digital assets.
If this applies to you, then you’re in luck! On April 2nd the Denver Crypto Group is hosting a hybrid (zoom and in-person) event that will explain our flagship product, the crypto HomeBase® so you’ll know exactly what it takes to properly secure your cryptocurrency.
We will also be talking shop with other members of the Denver Crypto Group about exciting projects and opportunities they’re taking advantage of, so come on out for a fun evening of learning and community conversations.
Starts at 6:45pm on Tuesday, April 2, 2024.
In-Person: Eloise May Library, 1471 S Parker Rd, Denver, CO 80231
Online Zoom: https://us02web.zoom.us/j/85881997520?pwd=S2c5azF0dXJhUTA4bzRWYXZnQU44dz09
Hope to see you there!
That’s it for this edition, stay happy and healthy and I’ll catch you soon!
Much Love,
~Matt