From The Weekly Bubble – 5-17-2021

Hello Bubble Riders!

The main news for today: the Basic Economic Cycle indicator is at Green 5.

• Personal Sell: Last night,I sold about half of my $ETH stake, from what I owned by February of 2020, with a buy price of $191, for a 17.7x return. Apparently, I’m a crypto-whale at this point, and when I put in my sell order, I spooked the market causing $ETH to drop in value for more than an hour. As a result, I didn’t get the price I wanted for a sale (which would have put me over 18x), but it was good enough.
• Why I Sold: I sold because I follow my strategy. Bitcoin dipped below the SMA 160 and that is one of my signals to scale out of my trade. If it returns above that, I’ll scale back in. I doubt I’ll buy Bitcoin or Ethereum though. Instead, I’m looking at buying a few more altcoins.
• Top Trending News: Elon Musk’s continued Tweets sent the crypto-market into a tail-spin. This is what caused Bitcoin’s price to drop so fast.
• Crypto News: It turns out Elon Musk was lying about working with the DOGE team to update the coin. The lead developer says he never got direct communication from Elon.
• Oil News: Oil prices have remained pretty steady at about $65 a barrel. Since $RIG is sustainable at that price, I’m still holding.

Let’s turn to a more detailed look at each section.

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Sector Health

Comments

Slightly down today, but that’s fine. I’m also looking at $MEXX (a 3x fund on Mexico).

Comments

The question is whether the bull is dead.

If it is, then you’re looking for a bounce play. If not, then you want a nice 3-6 month hold.

I bought some $MATIC just this morning, using some $BTC, and it was a small amount. I plan to add a few more alt-coins that will do better in a bounce-back than $BTC. 

Honestly, I think this is a blip caused by Elon, but I’m not adding large amounts until $BTC’s price goes above the SMA 160.

Comments

The dip buys here are really in the miners and exchange stocks.

• $MARA, $RIOT will bounce a TON if this is not the end of the bull run.
• $VYGVF will also bounce a TON. $COIN will make comparatively modest gains.
• The market has forgotten about NFTs for the moment, so if I’m looking at $CHZ with a  3-6 month time frame.

Comments

Everything here is fine. The pipeline hack ended, but oil prices look to be in the $65 and up range, making $RIG viable. I might add more. I’m also looking at adding more $PBR.

Comments

Nothing new here. We’re waiting on new federal legislation … which won’t happen until 2022 at the earliest. I honestly don’t expect real movement until 2024.

I am looking at initiating very small positions in $GBIF and $CURLF — with a 5-year time horizon.

Comments

This has been a frustrating market. 

• Joe Manchin!!!
• Basically, nothing will change for the positive here until Biden’s infrastructure bill passes. Right now, we are getting no news about it at all.

Meme Stock Chatter

Just as a reminder, here’s what I’ve observed and tracked with Reddit scrapers for stocks.

1. Only r/wallstreetbets matters
2. If a ticker has under 150 mentions in a day, it doesn’t matter
3. The percent increase on a ticker is useless as a predictor
4. New tickers with sufficient mentions need memes for a strong probability of blast off.
5. YOLOs (posts where people put 95%+ of their portfolio into the trade) count for memes.

Well, it’s not surprising that $TSLA is on top because it’s down a bunch. Since the market is opening in the red today, this could be a dip-buying opportunity.

Meme Crypto Chatter

$BTC is king again in the meme chatter world. If this isn’t the end of the bull run, I’d expect it to make a nice run-up.

I’d expect $VET, $MATIC, and $ALGO to do pretty well too. As I noted above, though, I’m waiting for BTC to cross back above the SMA 160.

That’s it for today! Happy trading!

Notes & Disclosures

General financial disclaimer: This newsletter is provided for entertainment purposes only. I am not giving you financial advice and I am not a financial advisor. You should expect no financial returns one way or another based on my statements. These points hold equally for any statements that could be attributed to The Art of The Bubble or any related business entities. If you decide to buy or invest in anything, then your returns and potential losses are your own. No statements about taxation are taxable advice and you are encouraged to consult your own tax professional. You are also encouraged to do your own due diligence before investing in anything.