Interesting time to be starting this PM Diary. Potentially explosive situation in the middle east that so far has not really got markets moving in a big way but certainly may do. From the reaction of equities, crypto and most importantly oil, it would appear participants do not expect the war to intensify in a big way. The big threat to prices and the global economy is if Iran made efforts to block the Straits of Hormuz. This is a vital shipping channel accounting for roughly 20% of the world’s oil supply with around 20 million barrels passing through in a day. Were the Iranian regime to be successful in blocking this, we will likely see Brent crude trade above 100 USD a barrel and potentially a global recession were it to endure for a lengthy period.
We can see BTC has been holding a pretty strong position again testing the $110,000 mark before pulling back to $104,000 on the news of the military conflict. This is small in BTC terms, any serious escalation and it’s likely we will see BTC trade down to at least $85,000 as we see a flight to quality and moves away from risk assets. Altcoins have shown weakness and there is certainly a spread playing out of long BTC and Short altcoins. Do I think this is altcoins over as some are panicking and spreading hysteria? Certainly not, we’ve seen the same spread play out this way before and then seen an almost whiplash effect as they take a bid and narrow the spread with a delayed reaction.
In terms of Dogecoin, my views don’t change much, pricing wise we are in a similar situation to the earlier tariff debacle. We did see panic set in and markets oversold and it created a good buying opportunity if you were prepared to allow the panic sellers to squeeze the market a bit further down than your original level you were intending to get long. This is why I have orders in the market and often will leave them to be filled. Sometimes however, as that level approaches there is a new fundamental driver and it is pertinent to move the order a bit to allow for volatility in the market, I will always update this with a newsletter to subscribers. I paid **.** to get long earlier and am still happy to trade at that level in a full clip. If I were totally flat and new to trading Dogecoin I would be happy to do a half clip at **.** and then initiate another half a clip at **.** We are at levels that present good opportunities, certainly if the market was trading 40 cents I would be emphasizing more patience and sitting on hands for a while. It may be that paying 16 cents for Dogecoin ends up a good trade and you can be out at 21 cents but I play the discipline game so that’s not a trade I would take on. Remember that sitting on your hands is often the hardest skill in trading/fund management but it is also arguably the most important for a successful career.
Until next time, stay disciplined and positive.
(Paid subscribers will see the trade levels that are redacted in this newsletter)