Bitcoin crosses above 200D, invoking Rule #3 --> Buy Bitcoin above its 200D

STRATEGY: Rule #3 kicking in –> Buy Bitcoin –> $100K into YE

Bitcoin crosses above its 200D…
Bitcoin today crossed above its 200D moving average ($44,938), invoking Bitcoin Rule #3 –> Buy Bitcoin BTC above its 200D moving average

– Bitcoin fell below its 200D on May 18th, 2021
– Recall, we “stepped aside” on Bitcoin at that date
– Bitcoin has since been range-traded between $30k-$40k

With Bitcoin crossing above its 200D, we think Bitcoin will rally strongly into YE.  This is consistent with our view that “everything rallies” into YE.

RECAP: 5 rules of Bitcoin
Our 5 rules of Bitcoin are below.  The most known is #5, the “10 best days”, or the rationale to HODL Bitcoin.  But Rule #3 is a biggie.

As shown below, Bitcoin’s forward performance is far stronger when it is trading above its 200D moving average:


>200D, 6M forward return    +193%
<200D, 6M forward return       +10%

You get the picture, Bitcoin is a network effect/network value asset, and also apparently aided by price momentum.

STRATEGY: Buy Bitcoin or Buy Crypto equities
The associated action for Rule #3 is simple.

– go long


Why is this happening?
This is not clear.  But Bitcoin is facing a legislative and regulatory assault from China and the USA, and yet, Bitcoin is rallying.  This is a key insight.  

– Bad news is apparently baked in
– Last seller has sold


What is a way to gain exposure to Bitcoin rally?
Digital assets should broadly rally.  Thus:

– BTC ETH + tokens/projects <– digital assets
– BITW GBTC 1.92%  <– ETNs tied to Bitcoin


Crypto equities:
                                          Est Beta to BTC
– Silvergate        SI            5X – 10X
– Mogo                MOGO -2.00%     2X – 3X
– Coinbase        COIN 2.51%        2X – 3X
– Voyager            VYGVF    2X – 3X
– Riot Blockchain RIOT 0.13%     2X – 3X
– Microstrategy  MSTR 5.08%       1X
– Paypal               PYPL 0.99%         0.5X
– Square              SQ              0.5X