Kiss, Marry, Kill: Bitcoin's 'Sell The News' Volcano
Bitcoin is down over 15% from yesterday's intraday high. Don't panic! This was very necessary and even foreshadowed by ya boi. It's also an opportunity to position for the next run.
Bitcoin briefly hit $49k yesterday. Today it went under $42k for a brief period. More than a 15% selloff in less than 48 hours:
Bitcoin is now battling to stay above its 50 day moving average. How quickly things change!
Are we having fun yet?
I love these markets.
Look guys, there is no doubt in my mind that this massive pullback is a good thing. We needed this badly. The mining stocks sort of foreshadowed the carnage yesterday when they immediately sold off the ETF launches. Those companies have continued lower today and on serious volume. I mean just look at these declines today:
The bigger firms have been hit the hardest in many instances. One public miner, Bitdeer BTDR 0.00%↑ (not pictured above), is down a staggering 57% since December 27th. But as I noted in the Heretic Speculator chat while 2023 was winding down to a close, the end of year monster rallies in the mining stocks were silly and generally beyond logic:
The anecdotal evidence that I shared with full heretics was clear, we were obviously in a FOMO environment. Here’s an example of how crazy it got; this was my opening paragraph from my “Risks” section in my Marathon Digital MARA 0.00%↑ article for Seeking Alpha on December 19th:
MARA is up over 400% since the beginning of the year. In my view, investors should be cognizant of possible profit taking here in the short term as we approach the end of the year. Beyond that, Bitcoin itself has generally been overbought in recent weeks and may be due for a sizeable pullback under $40k per coin. In that event, MARA shares will likely decline as well.
At the time, MARA shares were $20. Eight calendar days and just five market sessions later, MARA traded above $31. In no world did that rally, that quickly make sense. Now for full disclosure, I labeled MARA a buy in my article and continue to own shares. In fact, I bought some more today. Now that we’ve had our blow off tops for this shorter term wave, weakness in the coming days/weeks can likely be expected. That means now is time to start thinking about which names to be dollar cost averaging to and which names to kick to the curb for the post-halving rally later this year.
Lets Play a Game
Back in the early Barstool Sports days, one of my favorite running content pieces was a cruder version of the game “Kiss, Marry, Kill.” I think you probably get the idea of how to play. Basically, you are given 3 options and must assign each one with “Kiss,” “Marry,” or “Kill.” The catch is, you have to use each tag only once and you can do this with pretty much anything. So today, we’re going to apply Kiss, Marry, Kill to a couple of different crypto-themed ideas.
Ready?
Here we go…
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