Basics of Bitcoin

Crypto Currency

Hi People, today I wanted to talk about crypto currencies. If you follow this asset class, you know it has been by far the best performing asset class - over the last 14 months. It is the fastest growing asset class we have in the investment world today.

This major new asset class has come out of left field and is taking the world by storm. Crypto currencies are led by the two biggest tokens, in terms of market capitalization, Bitcoin and Ethereum. However, there are literally hundreds of crypto tokens on the market, so you must do some serious homework if you want to invest outside these two proven winners. There are a few alternative tokens that I like, but the most important thing from an investment perspective is whether they will survive long term. Therefore, until you have a little experience in investing in cryptocurrencies, stick with Bitcoin and Ethereum.

Here is a link to view a chart from 3/3/24 of the latest Bitcoin breakout above $62,000 https://yhoo.it/41JaOGX. It is an hourly chart so it is very short term in nature but shows the momentum is still with Bitcoin which leads the entire sector. If Bitcoin moves higher, the rest of the tokens unusually move higher as well. With a market cap of over $1.2 Trillion, it is truly the leader of this asset class.

If you have been waiting for a decent pull back in price to buy your first Satoshi, or piece of a bitcoin, you may have to wait a while. The current momentum looks very strong and from what I see on the BTC-USD chart, it looks like a test of the old ATH – all time high – is in the cards. Hence, I expect the price to hit 69,000 in the near term and then pause or pull back a little.  It is very common to get a pull back in price at the old ATH before moving higher. If the price moves sideways after hitting 69000 and does not go down very much then this will tell me that the price could keep moving higher in the near term. If the price moves lower for several days, then it may have reached a short-term top. One never knows for sure, but this is the way I see the price action for bitcoin over the next couple of weeks.

In terms of risk tolerance. The cryptocurrency space is high to speculative risk due to the extreme volatility in the price of most tokens over the last few years. The volatility will continue for many years to come as some of these tokens become actual currency. Huge sums of money will be made and lost in this asset class over the next few years. If you want to talk to me about cryptocurrency, or any other asset class for that matter, feel free to click here to schedule an no obligation consultation with me. https://smladvisory.com