Blink at the moment and the situation driving the global economy can change in a flash. One minute Brent crude is trading $118 and the next as Trump speaks of talks to end the way, it’s trading $99. Interestingly, we are seeing corresponding volatility in equity and commodity markets but muted reactions in crypto markets. We are still in territory where the market does not seem to of made up its mind as to whether it’s a risk on or safe haven trade. Talk of ending the war has seen BTC and DOGE trade upwards but not aggressively.
It may be the case that this sideways price action will occur in the 8 cents to 10 cents range for Dogecoin for a while until we have sure progress with the war situation either being a ceasefire agreement or fall of the regime etc.
Where Am I?
Still as previous, I’ve done nothing since the war began, price action is too tight, I hold my existing positions, if I were flat however, things would be different. We are at levels overall in the grand scheme of things where one would want to have something on, 10’s doesn’t feel so great but 9 cents or lower as a first entry certainly wouldn’t be bad. I would be looking to do half to three quarters of a clip around 8.5 to 9 cents and then entering further at 6 cents and below in more size.
Scenarios
It’s worth remembering that significant damage to oil and gas production facilities in the Gulf states has occurred that can not be rectified at short notice. Should there be an end to the war and an opening of the Straits of Hormuz we will still be left with months of economic turmoil with raised commodity prices. There will however, be the relief sell off in Brent crude and likely relief rally in equities and risk assets. In this eventuality we would expect to see crypto joining the rally. If Iran decides to continue attacking oil and gas infrastructure in the Gulf states then things can get worse. Just be mindful of levels above in Dogecoin and don’t panic.
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