The Noise vs. The Signal
Strategy over Hype: Why Patience is Your Most Valuable Asset
Aloha friends,
I started this newsletter to provide a clear guideline on trends and where we are heading. Lately, I ran into questions like: "Influencer X said this," "Trader Y posted that," or "I read on X that this will happen." I have to tell you one thing: most of you are consuming far too much noise.
In the past, I was exactly like this. I stared at charts all day, watched every YouTube update, and hung on every word of the big accounts. What did it achieve? First, it cost me immense amounts of time I could have used better. Second, I got distracted by the noise and failed to follow the big picture and my own rules. Worst of all, it created constant anxiety: a feeling that I needed to change my strategy every time a new video dropped.
If you see yourself in this description, take a deep breath. You are not alone. But you must understand that in life, whether in relationships, business, or charts, keeping the big picture in mind is everything. Market makers are happy to take your money when you are confused. So, let’s look at where we actually stand today.
Disclaimer: Views expressed are the author’s personal views and should not be relied upon as investment advice.
Understanding the Relief Rally: Trading vs. Investing
Since the $60k low, we have seen upward momentum. This is a fact. But to navigate this, you must know your plan: Are you a short-term trader or a long-term investor?
If you zoom out, we are still in a bearish setup. All this has happened multiple times in the past and is a normal reaction to being oversold. Could you trade this? Sure, if you want to take short term trading into consideration. We went up 27%. As we did in the last cycles (sometimes even over 55%).
However, I do not see how one can get bullish at this very stage. We are still below the $80k–$85k resistance level. This is where the highest volume was traded during the downtrend and where many short-term holders have their entry points (see the big green spike in the graph at $85k).
Checking the past - in none of the previous bear markets we have ever reached that point again. If we go above this level, we are likely to have seen the bottom. For me, nothings shows this - despite what some people out there say. The chart structure does not signal a bottom; statistically, the probability of further downside remains much higher.
The "Saylor Factor": Sustainable Demand or Short-Term Pump?
Michael Saylor has deployed roughly $3B into the market over the last two weeks, pushing his total holdings to 761,068 BTC. So that is a massive amount of money he raised and pumped into the system, which he was not able to do in the previous bear market. However, it is worth stating, that he did not have the big global standing back in 2022 as compared to now.
The question we must ask: Does this change the structural reality of the bear market, or is it just a temporary correction? In a risk-off macro environment, it is difficult to see how this level of demand can be sustained indefinitely. Even with high yields for his products, Saylor's buying power eventually faces limitations.
Final Thoughts
Markets hate uncertainty, and right now, we have it all over the place:
Ongoing global conflicts and rising oil prices
A hawkish Fed and expected higher inflation driven by energy costs
Weak employment rates and increasing long-term yield curves, which signal trouble for the housing market
While disruptive, the long-term effect of AI integration on corporate earnings and market liquidity is still being priced in
Given this unclear ground, I see no reason to change my thesis: lower prices are likely ahead. While I cannot give an exact date, looking at past seasonality, I wouldn’t be surprised to see the next leg down within the next 2 to 6 weeks.ks.
Portfolio Management
No changes in my portfolio this week. I am remaining patient: a skill that is often the most valuable asset an investor can possess.
That’s it for today - I hope I could deliver some valuable insights.
Maloha
Stay Humble. Stay Curious. Enjoy the Journey.
Disclaimer: Views expressed are the author’s personal views and should not be relied upon as investment advice.