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A Couple Alts For The Road

업데이트됨

Back in February, I wrote about why I thought ATOM could be headed back to $8. Since then, price declined by roughly 75% into a level where I've considered picking up some. Here is the original analysis:

Cosmos - Is it Really Different? Or Is It Headed Back to $8?

Here is my more recent post from May, showing why I speculated that alts would get completely annihilated. I'll admit, I did a bit of gloating. Getting out when I did saved me a huge amount in losses (in terms of unrealized gains).

Although my hunch turned out to be correct, it doesn't mean I will continue to be right. In fact, the current market situation is quite challenging. No one "has the answer." A good investor will take all the information available to them and develop a plan that fits their own unique risk tolerance, and a strategy that will work whether they are "right" or "wrong."

Anyway, why Cosmos? I think crypto projects are just a load of fluff, so I'm basically just gambling on these two to have a bit of hype resurgence. Sometimes the most hyped projects have the largest bounces, even if they ultimately fade to lower levels. I remember there being a lot of hype around all the airdrops on Cosmos, as well as some general positive sentiment. I still think ATOM could head down to $4 or lower. ALGO (on the right) is supposedly carbon negative, which I think has a lot of pull in the crypto space. I also still own some XLM and Nano, with XLM being my largest remaining crypto position.

I'm buying coins that are usable, green, and developer-friendly. I do not expect them to appreciate drastically in value, so this is more of an experiment. There is serious risk with buying and holding altcoins for the long term, since they are almost guaranteed to perform poorly against Bitcoin. Even ETH failed to make a new ATH on its Bitcoin ratio. What does that say about ETH "competitors" like ALGO and ATOM? Or maybe....if ETH falters, something will take its place. It's very hard to figure out what would. Then it becomes a rabbit hole of trying to logically justify sustained long term price appreciation for any cryptocurrency. Just take a look at Bitcoin dominance. This could spell trouble for alts down the road. But it's also a promising sign - a new bull market does not begin with alts, it begins with Bitcoin. Anyone around in December 2020 when dominance was 70% will affirm this.

Regardless, let's see if the market gan give some green over the coming weeks. Some bullish targets are shown in green on the above charts, while bearish targets are shown in red. I've decided to start with these two coins for now, and may double the positions should they drop lower. If alts decline by another 50% or more, even ETH will probably have a tough time recovering for years, so this is of course a speculative gamble and not meant as financial advice! This is just to show that although I'm skeptical of the crypto space, I still think there are opportunities to ride waves, as long as one doesn't remain entrenched in any particular way of thinking.

-Victor Cobra

노트

Eh, it's looking a little more like these can just continue 50-75% lower without too much relief. I may decide to just abandon this little trade and wait to re-accumulate any crypto, if at all. On the other hand, a larger relief rally would be an opportunity for me to make some quick profit. Hard to say. ALGO looks at least a little stronger than ATOM.

Still a little on the fence - not large positions, but things look incredibly weak. If I choose to hold onto positions I may double down at those lower prices, but a recovery at that point could take extremely long.

노트

Well, that was short lived. Closed these positions (ALGO at slight profit, and ATOM at a slight loss) and will continue to just wait.

노트

I ended up Re-entering (spot only) at 0.29 for Algo and $7.20 for DOT (picked this over ATOM). I still think it’s possible we see some sort of larger bounce until the midterms. The 200 week MA seems too obvious for bitcoin, and I do think there’s risk for it to fail eventually. These positions are short term only.

노트

My latest update on the altcoin "bounce" shows that I again stopped myself out. There doesn't appear to be any sort of end in sight, so timing even a short-term bottom is anyone's guess at this point.