The Wolf Den #717 - Break Up With Your Investments Now!
The Power of Detached Investing
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In This Issue:
Break Up With Your Investments Now!
Bitcoin Thoughts And Analysis
Legacy Markets
Explain Blockchain To Me Like I Am 8
Bear Markets Are For Building
Apple Plans To Compete With The Big Dogs
Tesla Is Still HODLing
Voyager Deal With Binance.US To Finally Proceed?
Coinbase Launching Offshore
Crypto Crash. Bear Market Or Correction? | Joshua Frank
Break Up With Your Investments Now!
Many retail investors find it challenging to take profits and let go of their assets. It's as though they've made a lifelong commitment to the market and are cheating on their portfolio if they decide to sell.
Anything.
Ever.
This mentality is so widespread that it might warrant a mental health awareness campaign for retail investors who struggle to let go. But is this mindset as detrimental as it seems?
In previous discussions, I've highlighted the pitfalls of this approach to investing. Getting trapped in the echo chamber of the crypto or stock community, overlooking warning signs, and refusing to let go can lead to disastrous results. However, there may be a fine line that, if navigated carefully, allows investors to remain passionate without succumbing to the typical retail investor pitfalls. Let's explore how to achieve this healthy balance.
The key lies in distinguishing between unconditional and detached investing. Unconditional love might be a beautiful sentiment in a romantic relationship, but it spells disaster in the world of investing. As investors, our responsibility is to identify flaws and shortcomings in our investments as quickly as possible and take them into account when making decisions. Unconditional love for a cryptocurrency or stock is a recipe for failure.
Detached investing, on the other hand, might seem dull and unemotional (which is how investing should be), but it can still involve passion and excitement when executed properly. It's natural to feel emotionally connected to something in which you've invested time, money, and effort. However, it's crucial to recognize and manage these emotions to prevent them from clouding your judgment. While emotional detachment in a romantic relationship is ill-advised, it's a sign of a healthy relationship with your portfolio.
The takeaway here is to avoid conflating your love life with your investment life. While it may seem glaringly obvious, people often struggle to separate these two vastly different aspects of their lives. Going forward, strive to detach yourself from your investments emotionally. Monitor your portfolio less frequently, scrutinize your holdings for potential issues, and consider selling when you need cash.
It's essential to recognize that a happy romantic relationship and a successful investment portfolio require different approaches. Don't treat your portfolio the way you treat your significant other - remember that a happy partner and a thriving portfolio are two very distinct objectives.
Bitcoin Thoughts And Analysis
It remains to be seen if this correction will continue, but we did find a bit of support at the most predictable level possible - $28,600. I have been screaming this number from the mountaintop, so there should be no surprise here. That said, I didn’t exactly expect it to hit to the dollar.
This is theoretically strong support. If it breaks, we look to $25,212.
Play it level by level.
I would not be surprised to see a ton of chop this year, largely in this same area. But I don’t have a crystal ball!
Here is a closer look on the daily chart.
As for altcoins, when we see absolutely trash memes like PEPE start to pull tens of thousands of percent moves, that’s usually a signal that the mini cycle top is in. The altcoin cycles are becoming shorter and shorter.
Legacy Markets
European stocks and US equity futures declined due to mixed corporate earnings and investors examining the latest US economic assessment for interest rate implications. Autos led the drop in the Stoxx Europe 600 index, with Renault SA falling significantly, while L'Oreal SA saw gains after reporting strong demand. The Federal Reserve's Beige Book survey indicated that the US economy has "stalled," with limited access to credit. Traders continue to anticipate a rate hike next month. Inflation concerns persist, with investors also digesting mixed US earnings reports. Meanwhile, Bitcoin fell below $29,000, and oil prices dropped as gold saw a slight increase.
Key events this week:
Eurozone consumer confidence, Thursday
US initial jobless claims, existing home sales, index of leading economic indicators, Thursday
ECB issues report on March policy meeting, Thursday
Fed’s Christopher Waller speaks at cryptocurrency-focused event, Thursday
Fed’s Patrick Harker speaks on “monetary policy and housing”, Thursday
Fed’s Loretta Mester discusses the economic and policy outlook, Thursday
Fed’s Raphael Bostic discusses regional and national economic conditions, Thursday
Fed’s Michelle Bowman and Lorie Logan speak at event, Thursday
PMIs for Eurozone, Friday
Japan CPI, Friday
Fed’s Lisa Cook discusses economic research at an event, Friday
Some of the main moves in the market:
Stocks
The Stoxx Europe 600 fell 0.3% as of 9:58 a.m. London time
S&P 500 futures fell 0.8%
Nasdaq 100 futures fell 1.1%
Futures on the Dow Jones Industrial Average fell 0.5%
The MSCI Asia Pacific Index fell 0.1%
The MSCI Emerging Markets Index fell 0.2%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro rose 0.2% to $1.0975
The Japanese yen was little changed at 134.61 per dollar
The offshore yuan rose 0.1% to 6.8864 per dollar
The British pound was little changed at $1.2446
Cryptocurrencies
Bitcoin fell 1.4% to $28,838.27
Ether fell 1.5% to $1,950.63
Bonds
The yield on 10-year Treasuries declined three basis points to 3.56%
Germany’s 10-year yield declined three basis points to 2.48%
Britain’s 10-year yield declined two basis points to 3.84%
Commodities
Brent crude fell 1.6% to $81.83 a barrel
Spot gold rose 0.1% to $1,997.36 an ounce
Explain Blockchain To Me Like I Am 8
Good answer by ChaptGPT!
Alright, imagine you have a special kind of notebook where you write down all the times you trade stickers with your friends. Every time you trade a sticker, you write it down in your notebook.
Now, let's say all your friends also have the same kind of notebook, and whenever any of you trade stickers, everyone writes it down in their own notebook. This way, you all can keep track of who has what stickers and make sure nobody cheats.
A "blockchain" is like that notebook, but for digital stuff like computer money, called cryptocurrency. Instead of writing on paper, the trades are recorded on many computers all over the world. Each trade is put into a "block," and when a block gets full, it's connected to the one before it, forming a chain of blocks.
Everyone can see this chain, so it's hard to cheat or lie about trades. This helps people trust each other when they're trading digital stuff, even if they don't know each other in real life.
So, a blockchain is like a big, public, digital notebook that helps people trade things and make sure no one cheats.
Bear Markets Are For Building
Microsoft has joined forces with Web3 data warehouse Space and Time to enhance blockchain tools available to developers. This collaboration aims to strengthen the crypto capabilities of the Microsoft Azure Marketplace. What makes this partnership noteworthy is that Microsoft's M12 venture capital fund led a fundraising round for Space and Time in 2022. The involvement of Microsoft, the world's second-largest company, as both an investor and collaborator, is a promising indicator of a recovering market.“Partnering with Microsoft makes a lot of sense for us and to build with Azure adds a tremendous amount of value for our organization as we build these pillars to ensure that the world has verifiable data in a time where the complexity of data and the transparency of data is going to be more vital than it's ever been - Space and Time co-founder and CEO Nate Holiday told CoinDesk in an interview.”
Apple Plans To Compete With The Banks
Apple appears to have impeccably timed the launch of its new high-interest savings account. Following the recent bank run, Apple has partnered with Goldman Sachs to attract customers seeking a secure place to deposit their funds. Offering a competitive 4.15% APY, Apple's savings account compares favorably to other major institutions in the market. To open an account, no minimum deposit is required; customers simply need an Apple Card.
Tesla Is Still HODLing
There’s not much to say for this segment, other than the fact that Tesla is still holding on to its 11,950 BTC, worth about $350m. Tesla’s purchase price for the coins is undisclosed, but somewhere between $35,000 and $40,000. Unless Tesla sells or buys more, the news is irrelevant at this point.
Voyager Deal With Binance.US To Finally Proceed?
Court filings suggest that the majority of Binance.US's $1 billion deal to acquire assets from bankrupt crypto lender Voyager could proceed before the resolution of a legal appeal. The U.S. government has agreed to allow most parts of the transaction to continue, despite concerns over certain contract clauses potentially excusing breaches of tax or securities law. The April 19 filing proposes to put those contentious clauses on hold until the appeal is settled, but not the remaining elements of the deal. Lawyers for Voyager are concerned that Binance.US could withdraw from the deal after a four-month deadline, resulting in an additional $100 million loss for the estate.
Coinbase Launching Offshore
Cryptocurrency exchange Coinbase has obtained a license from the Bermuda Monetary Authority, allowing it to conduct various activities such as token sales and issuance, and operate as a digital asset exchange and digital asset derivatives exchange provider. A source close to the company claims that Coinbase plans to launch a derivatives exchange in Bermuda as early as next week. The development comes after CEO Brian Armstrong hinted that the exchange might consider leaving the U.S. due to regulatory uncertainty. Bermuda's regulatory environment and tax laws, which include a 0% corporate tax rate, make it an attractive location for businesses seeking to reduce expenses.
Thanks, Gary Gensler!
Crypto Crash. Bear Market Or Correction? | Joshua Frank
Today's guest is Joshua Frank, the co-founder of The Tie, the leading provider of information services for digital assets, aka the Bloomberg of crypto.
The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.