DCA Strategy Downtrend Season

DCA Strategy Downtrend Season


2023-03-28 18:48:40

Market situation

US stocks had a rally yesterday in all three indexes. However, stock futures fell. Gold and oil held around 1887 USD/ounce and 77 USD/barrel.

Bitcoin also surged above $18,000. Most altcoins also follow BTC. The crypto market cap is also back at $900 billion.

Crypto will flourish this year?

In a tweet on January 11, popular trader and analyst Rekt Capital predicted that BTC could “go well up” this year. He shares a price chart of BTC cyclical every four years. According to this cycle, 2023 will be equivalent to candle number 3, equivalent to 2019 of the previous cycle. If this is true, then it is possible that we will see BTC price rebound slightly this year to accumulate for the BTC halving event that will take place next year.

This is a perspective because there are many other factors and analysis methods such as based on on-chain data, macroeconomics,… On-chain data shows that BTC price has been in an accumulation zone for some time. long time. In this area, investor psychology is often depressed and some people give up.

Besides, the global economy is at a time of high inflation and a risk of recession. The economy has slowed but unemployment in the United States remains low. People are still spending and saving is extremely low. If the financial recession really happens and worse, people will not have the money to invest in any area.

In the short term, the market will have difficult times and the price will go down deeply. However, in the long term, the market will still recover and develop again. Therefore, times like the present are considered by many to be a good time to invest in price averaging and long-term accumulation. To be able to average long-term prices, often investors need to have a regular income, take profits in the previous cycle and have a reasonable capital allocation plan.

A Twitter share of the results of long-term price averaging shows the enormous power of this investment when it comes to choosing the right assets. This person said that, if the monthly price average of the Dow Jones index steadily rises from its peak (January 2022), by the end of the year, this investment is still more than 3.6% profitable even though the Dow Jones ended the year down nearly 9 % in 2022.

Using the other index price averages worksheet on buyupside.com also shows that, when averaging prices from the tops of indices like the S&P, the Nasdaq still outperforms the decline rate by far better. its during the year. Although, the average price of these two indexes results in losses, the loss ratio is negligible compared to its decline rate over the past year.

The same goes for the average BTC price. If the price averaging from the top on a regular basis still helps the average price of BTC will be lower and get a better price. And the best price averaging is when prices are going down, not during the growing season.

The second most important thing for successful investment is that investors need to choose the right investment area. For long-term crypto investors, or Thuan himself believes that the crypto market is like the early days of the internet. In the early years of 1998, so many technology companies appeared, it was difficult to know which companies would survive and thrive. However, if you choose an investment method such as allocating capital to the top 10 largest companies according to the capitalization rate of those companies. Year by year, the capitalization rating of companies changes, we also adjust the capital allocation ratio. This way, an investor could have invested in many tech company stocks that have continued to grow to this day from their very young days. And it’s these companies that deliver huge returns to the average investor.

Cathie Wood buys more Coinbase and Tesla shares

Although many people are concerned about Coinbase’s situation, Cathie Wood remains very confident in the company and the crypto market. Last Tuesday, the investment firm Ark Invest led by Cathie Wood announced that it has acquired more 33,756 shares of Coinbase exchange (stock code: COIN). The purchase is worth approximately $1.45 million based on a COIN price of $43.23 at press time, with shares allocated to the ARK Innovation ETF (ARKK).

Previously, on January 5, Ark also added 172,276 shares of Coinbase to its two funds, ARKW and ARKF. As of December 14, 2022, the Ark fund purchased up to 750,324 COIN shares in 11 different transactions. Ark holds nearly 8,596 million COIN shares across its three funds, ARKK, ARKW and ARKF. These shares account for 2.92% of Ark’s total investment capital.

Not just Coinbase, Cathie Wood is also bullish on Tesla shares despite the stock’s significant volatility. The ARK Fund purchased 27,811 shares of Tesla Inc on Monday at an estimated valuation of more than $3 million based on the day’s closing price.

In the five trading days of 2023 so far, ARK has purchased more than 283,000 shares of this company. The cumulative buying volume since mid-December amounted to more than 759,000 shares.

What if Ripple loses the SEC lawsuit?

Attorney Jeremy Hogan, partner at Hogan & Hogan, who closely follows the legal battle between Ripple and the US securities regulator, took to Twitter to share his views on the outcome Ripple could face. globally if the case is lost.

First, lawyer Jeremy said that Ripple will lose part of the US market. When Ripple loses the lawsuit, XRP will be listed as an unregistered security. In that case, XRP would likely lose 25% of its gains as the United States provides 25% of global economic activity.

Many in the crypto community believe that Ripple is currently fighting for the crypto space. Therefore, if Ripple loses the SEC, this will negatively impact the crypto industry in the United States, not to mention the price of XRP has plummeted after the lawsuit started in late December 2020. So, If indeed Ripple loses the case, it will also lead to a sharp drop in XRP prices.

As for the future, XRP is still active globally. The majority of users in the United States have been restricted from buying and selling XRP. Therefore, if the result loses, it is possible that Ripple will move the company headquarters out of the US.

This case has not yet come to a conclusion. There is still a plan that Ripple will negotiate and reconcile with the SEC to continue operating. It is also possible that Ripple will win the SEC lawsuit. Let’s wait for new updates regarding this case.

Update on DCG

Yesterday, DCG CEO, Barry Silbert, wrote a letter to shareholders on January 10, reflecting on the state of the crypto market and the growing fear, uncertainty and doubt (FUD) surrounding the company.

In the letter, Silbert also mentioned the growing problems surrounding DCG and its subsidiaries due to the bear market and the spread of FTX. Besides, are the shares about the crypto market as well as the difficulties of this market in 2022.

In the second half of the letter, Silbert addressed several questions about DCG’s relationship with FTX, the loan agreement with Genesis. He said Genesis has a “lending and trading relationship” with Three Arrows Capital and invested $250,000 in FTX’s Series B funding round in July 2021. DCG also borrowed $500 million from January to May 2022 at 10%-12% interest and currently owes Genesis $447.5 million and 4,550 Bitcoin (worth $78 million) due in May 2023.

However, in the letter Silbert did not mention the accusations of the CEO of Gemini exchange sent to DCG. His letter makes the reader visualize as a farewell letter from someone who is about to leave their position.

Other information:

► Join Exchanges with exclusive deals with CHK

#DCA #Strategy #Downtrend #Season

Leave a Reply

Your email address will not be published. Required fields are marked *