Good Day Rookie Bloggers! For those of you who know me or have at least interacted in some of the content, I have been involved with you probably know that I am more conservative about trading than maybe some of the other coaches in our community and there fore it may seem somewhat strange that I am wrtiting about bitcoin. There is however a method to my madness and if you are willing to read on a little further into this blog then hopefully I will be able to convey my thoughts about the Power of Bitcoin. Lets begin!
If one was to comb through my favorite watchlists one would see the most stalwart of blue chip companies that I feel are very fundamental strong and that I can see a very stable future in. The word speculation feels almost “dirty” to me as I have seen my fair share of speculations go horribly wrong and I have also done this myself to not great success. The path of least resistance from my point of view is slow and steady returns from low volatility trades. This makes up the vast majority of my trading and investing. I always have a little capital set aside just in case I am feeling “randy” but this is limited to a very small percentage of my overall portfolio. So why then am I talking about something like Bitcoin that has a very speculative feel to it?
Well, that is not as hard to explain as one might think. Bitcoin is over a decade old and there has been many developments and changes since its inception. It has started out a fringe product that was touted by a small group of players. Bitcoin has certainly gained in popularity in the last decade and this is where the real changes have begun in my estimation. Bitcoin and cryptocurrencies are becoming more and more mainstream all the time and this is evidenced by the acceptance from major institutions as well as the ability for more trading products such as Bitcoin and Ethereum futures contracts. It is these developments that takes a guy like “Old Money” Holmes from swearing off Bitcoin altogether to being mildly intrigried. In my world, a mild fasination is not enough for me to start throwing capital at speculative investments. It takes more than a few people jumping into the pool to get me onside.
I have started to have conversations with those around me that I trust to get different perspectives on what the future might hold for Bitcoin and cryptocurrencies in general. There are very opinions but the consensus is that Bitcoin is here to stay. I then went to a trusted Mentor of mine to get another very experienced view of the landscape as well as some beginning education on the subject matter. All of this added up to me starting to look at the world of Bitcoin. I kinda of feel like the Fed in some respects, I am willing to have the conversation about starting to think about, starting to look at maybe trading Bitcoin in the future. LOL
So what does all this mean….does Bitcoin have some magical power that has compelled me to view Bitcoin in a different light? The answer is a resounding….NO! All of the reasons stated above are very valid reasons to get involved in the new speculation known as Bitcoin but did that sway me to invest or trade Bitcoin…..that answer is also…NO!
If you want to know why I put a trade on in Bitcoin then look no further than the chart below….
In this chart you will see two white lines that I have drawn on it. The falling white line is the trend line that was made while Bitcoin was getting brought back down to earth after a very agressive extended run upwards. This is what I like to call a reversal trend line. This line must be breached before I get interested in any stock, commodity or really anything for that matter. This is only step one for me. I then must see the price get above major moving averages such as the 9, 20 and 50 day moving averages. This is step two. Finally, I must see resistance zones taken out before I would even considered placing a bet. This is exactly what happened to Bitcoin and ultimately why I decided to get involved in trading Bitcoin.
All those other items I mentioned qbove made me feel a little better about taking a speculation type trade on Bitcoin but ultimately for me the power of Bitcoin was in the charts which is where the power of any good speculations tend to come from for me.
The moral of this story is that power comes from within you and what you choose to focus on. When I am looking to speculate I focus on the charts and the technical setups. You may have different things to focus on and that is ok because that can be your source of power. Learn to harness this power within you and then the Power of Bitcoin can be the Power of anything you choose.
Trade Well,
Coach “Old Bitcoin” Holmes
