On Wednesday I told you to take half-profits on MicroStrategy (MSTR) if we got another green candlestick. And boy did we:
The stock gapped up on the open yesterday to a record high of $543. Then the green candlestick turned to red like a bad Christmas slasher movie. The stock crashed all the way back to where it was on Monday.
Today, it is up (of course) as Bitcoin attempts to cross over the mystical $100,000 a coin mark. Of course all of the Bitcoiners are out in force doing the Trump dance with their laser eyes and diamond hands.
Other crypto coins like Solana (SOL), and Ethereum (ETH) are also up. XRP (XRP) is up 69% today – Nice. DOGECoin is at $0.40 up from $0.085 at the start of the year.
The crypto market cap is now $3.2 trillion – with Bitcoin representing 59% market share. Despite the snow falling outside it would seem that the crypto winter is over and joy has returned to Whoville.
Last weekend my 86-year-old father was over to watch the mighty Ravens of Baltimore battle the evil Steelers of Pittsburgh in a poorly played American football game. He asked me what my Bitcoin play was and said he was thinking he should own some.
I told him about MicroStrategy (MSTR) and another Bitcoin miner I own called Marathon Holdings (MARA) which, like MicroStrategy, is also selling stock to buy BTC. The stock is up 7% today and 73% for the month.
The short position in MARA is 26% of the float – which could lead to an epic short squeeze.
They aren’t a pure play on Bitcoin however as they have gotten into data centers for AI.
My point is that when my 86-year-old father starts talking about Bitcoin you know almost all of the buyers have bought. It is like the old story of Joe Kennedy and the shoeshine boy in 1929. When the shoeshine boy starts giving you financial advice it is time to get out.
The problem is that this generation has never experienced a gut-wrenching bad market. If you graduated in 2010 at 22 years old you would be 36 now making around $100,000 a year and your 401k is over $400,000. You are now making more in the market than you contribute.
The only regret you have is that you didn’t buy more. You don’t remember when the S&P 500 fell from 1,550 to 666. They don’t think that $400,000 could turn into $172,000. It is an entire generation of new suckers who don’t believe in gravity or valuation, who says that recency bias isn’t a thing.
These people should have been wiped out after the Bored Monkey ETFs and the diamond hands craze of 2021. But they were bailed out with massive money printing.
At some point, these people will be hit with the ugly stick of reality and will have to wait for the next generation for the next bubble. Don’t get me wrong: the reckoning is not here yet.
The trend is bullish. Here is the Russell 2000 ETF (IWM).
Those three moving averages are slanted up and are equidistant. The trend is up. You might as well make money while the sun is shining. Just have a fast finger on that sell trigger.
All the best,
Christian DeHaemer
Outsider Club
Brit talks Bitcoin: https://www.outsiderclub.com/too-late-for-bitcoin/
As I was saying: https://www.outsiderclub.com/my-bitcoin-price-prediction/
What to buy on the Russian War: https://www.outsiderclub.com/russian-uranium-ban/
