jakiro
Author: MacroScope
Compiled by: Liam
Some brief descriptions about the BTC sell-off and what to pay attention to next:
1. I once said that during the gold bull market, Bitcoin should far surpass gold.But it should be noted that when risky assets are hit like last week, Bitcoin’s risk factors will drive its trend more than its long-term inflation hedge.But its relationship with gold’s “fast horse” remains unchanged.The price level I mentioned in my tweet on February 19 is still valid.If BTC’s trading price rebounds to these levels (basically new highs), we will usher in a new era in which BTC performs well against gold and other assets.The keyword is “if”… This is not a prediction.
2. It is very important to understand the institutional mentality.I posted a message after the November 10 election: “Bitcoin’s price pullback may trigger a large number of bidding. This has been going on for months, but I think it will intensify in the future. Many institutions are price sensitive and will choose to wait and see when the momentum is strong, but when the price reaches the level they are acceptable, they will actively participate in the bidding.” Remember those 13F documents showing a large number of positions and new buyers such as the Middle East Sovereign Wealth Fund?These documents are as of December 31, so all these purchases occur in October, November and December.The decline in Bitcoin last week brought us back to mid-November price levels, and most of the purchases of 13F occurred during that period.Many price-sensitive buyers are active again.Sovereign Wealth Funds will not buy in large quantities for losses or small gains in a few months.Unless his investment theory changes, Paul Tudor Jones won’t make IBIT the largest stock/ETF position in its entire portfolio (as per the recent 13F filing, he did), but just to exit soon.This type of buyer lives at a certain level and they like to enter liquidity.We will learn more in the next round of 13F files.
3. It is important to pay close attention to DC.It is understandable to be frustrated with the slow progress of the BTC reserve strategy, but it is wrong.Remember, Trump’s executive order on January 23 sets a 180-day deadline for the Working Group to submit its national reserve report.This means at the latest by the end of July (and possibly before that).Traders will start looking forward to this report in the coming months.
4. Trump has always defined his presidency based on stock market performance.BTC is obviously part of self-evaluation now.If the price weakness continues before the task force submits its report, Trump is expected to issue a statement in support of the BTC, and may even take unilateral action or announcements.Traders (especially short sellers) should understand that this can happen at any time.
5. The Loomis Act proposes that the United States buys Bitcoin on a large scale.I have said that if the bill (or similar initiative) is passed, the price of Bitcoin could soar to six figures or even higher.But even if the bill is not passed, does anyone really think that the only country that has recently started buying Bitcoin is the one that has to pass the 13F disclosure?
6. Finally, be sure to remember the wise position management I mentioned earlier.This is crucial for both investors and traders.If anyone is concerned about this sell-off, it means they need to reevaluate their position size.I made the following point after the election on November 10: “It will become even more important to stay conservative to avoid being eliminated in a long-term market that has changed significantly today.” We feel sorry for leveraged traders and speculators.
