Bitcoin and Ethereum trading plan and targets

With the current monetary policy of devalution of currencies by Quantitative Easing, all around the world, could mean hyperinflation in the long run with increasing stock prices, a flight to other asset classes such as cryptocurrencies, real estate and precious metals. Gold recently hit a new All time high och 2000 USD. Silver is lagging a bit behind.

If Bitcoin will be the future money, the new USD, Litecoin could be the Euro or Chinese Yuan. While Ethereum will be the MS-DOS (older version of Windows OS). Other cryptocurrencies (altcoins) are battling to be the new Linux. The cryptocurrency space is the Internet in 1997, before everyone believed in it.

Read my other post about cryptocurrency if you are not a believer.
Bitcoin and the coming infrastructure inversion

In this post I will have a look at Bitcoin and Ethreum. Since I still believe we are early in the space I will aim for higher targets. I’ve been reading different price predictions and formed my own opinion.

Lots of things are happening in the cryptospace where lots of altcoins already increased 10x, and some 100x in price. Bitcoin and larger ones are about to follow.

Bitcoin

Weekly chart
Daily 1 year chart

In Plan Bs model Modeling Bitcoin Value with Scarcity it predict a “Bitcoin market value of $1trn after next halving in May 2020, which translates in a bitcoin price of $55,000.”

In the follow up study Bitcoin Stock-to-Flow Cross Asset Model, the model suggest a translation “into a BTC price (given 19M BTC in 2020–2024) of $288K“.

Using a modfied logarithmic price chart of the one by Aksel Kibar: https://twitter.com/TechCharts/status/1288574115541114881

The trend is up as long as it stays in the channel (green lines). Since the price is logarithmic the price scale is x1000. My price targets depends on when BTC will go parabolic again and if there is a resistance halfway (orange line). I do believe it will go to the upper trendline in time. If it breaks the lower trendline I will reevaluate.

A target point could be above 60k (midway). However I will hold to at least 100K before I will start sell off parts and once it touches the upper trendline I will sell most of my position. I’ve set price alerts.

Ethereum

My first target is 1300 USD, just below the previous top. I’ll aim to sell at least 1/3 of my position and but I aim to readd if there is a dip.

If the total market cap will reach 1 trillion USD the price will be aprox. 9000 USD if the current supply will be the same.

During the last bull run in 2017 the price went from around 7 USD to 1400 USD, an increase of 2000x. If it would do a 500x from the low of around 100 USD that would give a 50000 USD price. This would mean it will overtake Bitcoin. Could it happen? I don’t really know.

If Ethereum continues to dominate the smart contract markets the price should continue to increase.

I’ll aim to sell at least 50% of my holdings if the price reaches 9000 USD. I will try not to buy back. The rest I will hold until there is a clear parabolic price increase. I will sell most of it once it breaks the parabola. If the parabola happens before 9000 USD I will probably sell before.

Holding Ethereum involves much higher risk than holding Bitcoin IMO. However it has the first mover advantage. I will reassess my price targets in the future. I will use a mental trailing stop loss for some of my holdings and the rest a hard stop just below the weekly 200 MA around 250 USD.

It’s a strange time to live in. Opportunities left and right. Who wouldn’t want to invest in Microsoft a few years after it was founded?

To the moon!

Leave a Reply