My opinion on cryptocurrency used to be incredibly bearish if we're talking back in 2017-18 after Bitcoin hit over $19,000. An unregulated market and currency became a hub for black market deals as it could not be tracked. But now my opinion has changed a bit for a few reasons: 'safe-haven' pairs weaken like USD, FOMO, and hype apparently outpaces logic.
Prices came up to a yearly high yesterday to $0.0052, originally at $0.0020 before a massive amount of buyers stepped in. Shortly after, traders clearly took profit, and the price dipped down to $0.0030s. Right now, dogecoin is up over 416% from lows after several TikToks and memes become some of the greatest market analysts in the world. As ridiculous as it sounds, it's comically true.
Anyone can bash crypto as much as they want, but the price defied all crypto bears. I mean, who doesn't want to be a part of a trade that moves 400% percent in a few days? This largely has to do with audience. Who do you think is making trades like this? It's not billionaire investors or people running hedge funds; they are probably young, speculative investors who want to get rich quick. If you keep up with stocks, you might have seen Hertz stock soar over 100% as the company is facing bankruptcy. With millions of young investors who have incredibly easy access to markets now are seeing an ultra cheap price along with talks about it on social media, it becomes an indicator in itself on what to buy. It's similar to reading 13F filings on institutions to see what stocks they bought last quarter. People often read Warren Buffet's 13Fs to essentially copy what he does. I realized that you can do this in the same way but by using social media platforms like Instagram or TikTok, which leads me into my next point.
Fear of missing out is a huge issue now as chasing prices can actually work in these weird market times. We watched as Nikola Motors announced that they will start manufacturing their new pick-up truck and begin sales in the near future. The stock price went from the $30s to peak at $95 before selling off back to the $50s. That means lots of money was poured in the stock even after the shareholders' vote passed the merger, and people were buying in the $60s, all the way up to the $90s. If that's not chasing price then I don't know what is. This is the kind of behavior happening with dogecoin.
When the US took measures to stabilize their economy, trillions of dollars were created to provide funds for the unemployed and businesses as well as the Fed's $7 trillion balance sheet. Other countries did the same strategy of causing inflation to their currency, but none were on this level. Like metals, crypto is another place people might transfer their money into when fiat money begins to hurt.
As far as fundamentals go, I have none on dogecoin. All I know is that it is a meme that became legit according to the investors that brought it up over 400%. Analysts are still ranking it a buy regardless of the move it just made.
What I think
Cryptocurrency as a whole is speculative, but so are investments like Tesla. If you can know where money is flowing, or at least speculate, your trades could end up becoming very profitable. I'm not telling anyone to buy dogecoin, but as crypto progresses, it will become more and more relevant over time. If I'm feeling frisky, I might put some play money into doge for the fun of it. After all, $20 in this crypto is around 6,000 units of dogecoin.
Thanks for reading! If you are interested in joining our trading community, we have chat rooms, trade alerts from our top traders, and educational content. You can join using the link below, and get a discount on your membership.
Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.
Looking for a Broker?
Check out our favorite brokers & reviews! Find brokers available in your country, or our top rated brokers to consider.
Weekly Forex Forecast for GBPUSD, CADJPY, GBPAUD, XAUUSD (17-22 January 2021) Hey everyone! Welcome to this week's forex forecast for the week ending January 22nd, 2021. I'm TraderBart with A1 Trading, and this week I'll be looking at GBPUSD, CADJPY, GBPAUD & XAUUSD. GBPUSD Looking at GU on the Daily timeframe, price has been channelling […]
Weekly Forex Forecast for GBPUSD, EURCHF, USDJPY, XAUUSD (10-15 January 2021) Hey everyone! Welcome to this week's forex forecast for the week ending January 15th, 2021. It's so great to be back, I hope everyone's had a fantastic holiday, and I hope everyone's motivated to work 10x harder than last year. I'm wishing everyone nothing […]
Throughout the year, we've seen many changes to the way we trade, how we manage risk and how we interpret the markets. The new insights we have gained over the months usually come after years of trading and adapting to ever-changing environments. We've done all that in a matter of months! Up until the New […]
Politics preventing new financial stimulus The economic recovery in the major global economic powers depends on several important factors. One of the most vital part, the spread of the virus and the government's answers to it. With a decrease in daily cases of COVID-19 to 50,000 in the U.S.A. Yet U.S. A remains the most […]
Our team has unfortunately received many reports of scammers using our content and pretending to be us. While we will continue to report these accounts to the authorities as we receive reports, we may not always catch them in time. Below our a list of things to look out for before making a purchase to any […]
Warren Buffett is one of the most idolised, investors in the world. At the time of writing , his company, Berkshire Hathaway, has a market cap of $495 billion and Buffett himself has a net worth of $79 billion. His approach to value investing, combined with his influence over the companies he invests in , […]