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Sell the News, or is this just the beginning of our long strange trip?

Bitcoin (BTC) is back at it's highs today.  Tomorrow is FDay for BTC - Fork Day.

Why is BTC at it's highs the day before the fork?  Is this a case of buy the rumor and sell the news?  Or, is this a case of the market showing satisfaction that the fork process is expected to go well and the BTC price is about to explode to the upside?

There's a well know saying in trading of "Buy the rumor, Sell the news".  It has proven itself to be true over and over again.  Very often good news is already figured into the price of an equity and when that good news actually becomes true, the equity then drops because the anticipation of the event has passed.

Is that the case now with BTC?  Should we be looking to sell BTC as soon as the fork is implemented on Aug 1st, 2017 at 7:20 AM CT?  Or, is the price being held back by the fork and once the fork goes smoothly it is going to take off.

To make things more difficult there is an alternate explanation for the current high price of BTC.  One that makes a lot of sense to me.  When the fork happens, if you own any BTC you will get an equivalent amount of a new coin called Bitcoin Cash (BCC) for free.  Just for owning BTC you'll get the BCC.  But, the catch is you have to own BTC in the first place.

That means a lot of people have been selling off their ALT coins and using that money to acquire as much BTC as they can.  Naturally this increased demand has driven up the price of BTC and it has killed the price of almost every Alt coin.  This is exactly what we are seeing now, BTC at an all-time high and Alt coins at major Lows.

I believe BTC remains in both a short term and a long term Bullish channel.  I think this might just be an early stop on the long trip that BTC has to much higher prices.  But I also believe Alt coins are at a "fabricated" low because of the need to own BTC at the time of the Fork.  I don't know if we'll see BTC take off or retrace after the fork has passed, but I do think we'll see Alt coin prices sore again as they were doing for the weeks and months before the late June / early July correction.

Only time will tell, but one thing is for sure and that is the next 24 hours is going to be interesting.

Comments

  1. Josh JarniganMay 2, 2018 at 11:03 PM

    Nice blog. The current trust networks face a variety of issues. Poor privacy protection, untapped data value, data management monopolization, and ineffective identity authentication are all opportunities for blockchain. Ontology seems to resolve these issues with its solid trust ecosystem. For more information visit: NeonBeginner

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