What goes down, must come up
Following the sea of red in the market yesterday, with all coins apart from Bitcoin crashing, today we have a sea of green for the recovery.
As I mentioned yesterday, experience has taught me to sit on my hands, people chase the market they move between Bitcoin and altcoins, and if you chase the market, you can often be late and make losses traded out of altcoins and trading back in.
Stick to a strategy. Don't be greedy.
My trades are always in expectation of a movement. For example my post the other day about liquidating the majority of my Ripple for Ethereum. The trade was based on a hunch, backed by the charts showing huge moves against a backdrop of little news. To me, this was just an overpriced pump. With Ethereum being 10% down this felt like a good trade. If I had held onto BTC during the crash rather than a straight flip to Ethereum, I would have benefited from a further the rise in the price of BTC yesterday and then the continued drop in ETH and bounce back. Still, ETH has bounced back, and I am happy with the trade, I saved around 35% in the drop of Ripple, and I see a considerable upwards potential for Ethereum over the coming months.
Following the crash here is lots of information I am trying to digest which will affect my trades over the coming days/weeks. I am thinking of consolidating my altcoins and am therefore watching all my investments in four tiers. We are in unchartered territory and a correction may come. Though for me it is an emotional correction, not a value correction.
Based on the recovery:
Tier 1 - Bitcoin
This is a firm hold strategy, the recent moves have been impressive and while we will likely see the price bounce around there is still considerable upwards potential. The impact of Japan making crypto legal is evident with YEN % of market trade. After the initial push where YEN was trading 44% of Bitcoin, it has now settled at under 30% just behind the dollar. Korean and Russian markets are also about to make some moves. I think Bitcoin may cross £2k this month before a retreat and we have a potential of up to £5k this year, depending on how it manages resistance levels.
Tier 2 - Next Big 5 Market Cap
- Ripple, I am watching but have no plans to increase investment, slight concerns over the reality of the tech. This could go either way; I think market cap is too high.
- Ethereum, strong hold, the only reason I am not increasing my hold is I am quite exposed to ETH right now, lots of good news coming out.
- Litecoin, strong hold, lots of good news and development, longer term I will likely sell if it hits a price of +$100, I think Litecoin will probably drive changes to Bitcoin and could then become redundant
- DASH, hold, not sure where this will go next, it seems to have settled at its current price, wait and watch.
- NEM, hold, the more I read about this, the more I like it, I will likely increase my position here as I am underinvested for its market cap.
Tier 3 - Other Top 20 Market Cap
- Ethereum Classic, not invested and no intention to
- Monero, strong hold and may increase investment, currently undervalued compared to Dash
- Stellar, position sold, will not be investing, overpriced and concerns about team
- Steem, strong hold, I love these guys, massive moves this past week but I love what they are doing and may increase investment
- Golem, watch, has stagnated recently, keeping an eye on the news from the team
- Augur, hold, need to spend some time understanding where they at, has been a good investment so far
- Dogecoin, sold my position, overpriced
- Maidsafecoin, strong hold, hugely underpriced compared to other coins, main issue for these guys is how long it is taking them, a sleeping giant in my books may increase position
- Stratis, strong hold, need to keep an eye on them though
- Zcash, not invested, think I missed the boat on this one, will consider a small investment soon
- Gnosis, not invested, I think it is hugely overpriced, may make a small speculative investment as it has a very strong team behind it
- Bitshares, watch, was a speculative investment with good returns so far, need to increase research
- Bytecoin, no investment and no knowledge
- DigixDAO, no investment and no knowledge
Tier 4 - All other speculative investments
- Factom, strong hold, underpriced, great investment and a great project
- Waves, hold, need to watch closely
- Decred DCR, watch, may be overpriced, I don't see much upswing here
- Siacoin, hold, need more research
- Gamecredits, strong hold, love these guys
- Lisk, hold, need more research
- Iconomi, hold, need more research
- NXT, hold, need more research
- Syscoin, strong hold, hugely undervalued
- Storjcoin, strong hold, I think this is also undervalued
- Melon, hold, need more research
- Counterparty, hold, need more research
- Wings, hold, need more research
- RLC, hold, need more research
- Ardor, hold, need more research
- Expanse, hold, need more research
- Nautiluscoin, hold, need more research
With my Tier 4 coins, they are small investments, and I need to spend more time researching them.
The bounce back for these coins has been less than with the top 3 tiers; this might reflect a bubble.
Any questions, then please give me a shout.