sport football: Smart Money Is Buying the Dip

July 10, 2024 | Read Online

Smart Money Is Buying the Dip – You Should, Too

In July 2018 bitcoin was trading at $8,000. And my research told me as adoption increased, the price would ramp up rapidly.

I would end up being both right and wrong at the same time.

All through the 2018 bear market, adoption rose. Yet the market hammered bitcoin's price lower.

This was due to traders hedging long positions with a corresponding short position in the newly formed bitcoin futures market.

We saw traders liquidate their spot bitcoin and clean up on their short position in Chicago Mercantile Exchange (CME) futures.

It was the first market period in bitcoin's brief life when traders had a reliable mechanism to go short.

Many believed the introduction of CME futures along with the ability to go short would mark the end of bitcoin's meteoric rise.

It wouldn't come out until nearly two years later… But the whole premise behind approving bitcoin futures was to crush the price of bitcoin.

The head of the Commodity Futures Trading Commission (CFTC) at that time, Christopher Giancarlo, was secretly working with the SEC to hammer bitcoin prices lower by creating a mechanism (bitcoin futures) to short bitcoin.

For the powers that be, it was mission accomplished. Bitcoin's price dropped as low as $3,150 over the next 16 months. In their minds they had killed bitcoin.

Imagine their surprise when a "dead" bitcoin rose to as high as $69,000 just a few short years later.

Anyone who bought during this down period could've seen an incredible 2,090% gain over three years.

In September 2017, JPMorgan Chase CEO Jamie Dimon infamously called bitcoin a "fraud" and threatened to fire any of his employees caught trading BTC.

The price of bitcoin dropped as much as 30% over the next three days. Uncoincidentally, his London office started buying BTC after his comments knocked the price down.

In less than two months, BTC had hit a new high, making those traders as much as 137%. Most hedge funds don't make that in 10 years.

Here's why I'm telling you this…

Right now, we're in the middle of another massive handover of wealth from individuals to institutions. And I don't want you to be among the sheep who fall prey to the wolves.

My Bet is That Smart Money Is Buying the Dip

Since hitting an all-time high of $73,800 on March 14, bitcoin has plunged as much as 27%. It's the steepest price decline since the 2022 bear market.

There are a couple of reasons behind the current price weakness.

As I told you in my July 6 Digital Asset Daily essay (you can read it right here), the post-halving sell-off we're seeing right now is par for the course.

Generally, we see a price surge before the halving. Then bitcoin chops sideways for months, with plenty of volatility in between, before the next leg higher.

The other news depressing bitcoin prices is the massive surge in supply coming to market from the defunct Mt. Gox exchange and the German government.

Last month, Mt. Gox began returning 140,000 BTC to former customers who lost their tokens to a hack in 2014 when bitcoin was trading at $700. Many of those token holders are selling their positions now for huge gains.

Meanwhile, the German government is selling some of the bitcoin it has seized over the years. The U.S. government is also selling some of its seized bitcoin stash.

Combined, that's about $11.6 billion in supply pressure hitting the market in the coming weeks.

Now, I want you to think about this logically…

If you're a large institutional buyer and you know the coins are out there and can see them moving to the exchanges (because everything on the blockchain is transparent)…

What are you going to do?

You're going to pull back your bid and you're going to wait for the price to come to you.

And that's exactly what's happening.

But this pullback will be short-lived as smart money rushes in to buy bitcoin from weak hands.

Digital asset investment products saw $441 million of net inflows last week, breaking a three-week string of net outflows, according to CoinShares. The products last registered net inflows in the week ended June 7, when investors added more than $2 billion.

On Friday, bitcoin fell into the $53,000 range. So investors are getting the best bitcoin prices since February.

While the average investor panic sells, my speculation is that it's the smart money buying in bulk here.

Don't Fall For This Wealth-Stealing Strategy

Friends, we don't know for sure if institutions are buying up all that bitcoin on the cheap right now. The answer will come next month, when they file their quarterly reports.

But if you wait until institutions that control billions of dollars announce their positions, odds are you won't be buying at levels we see today. Prices will be much higher.

We saw this play out in May…

The first spot bitcoin ETFs launched in January, giving institutions easy access to bitcoin for the first time. These guys move around billions of dollars in assets. So it takes time for them to establish a position.

And they won't disclose their positions unless they have to. It's like revealing your cards at the poker table to the other players. But as I mentioned above, they eventually have to show their hand when they file their quarterly reports.

And on May 14, the State of Wisconsin Investment Board (SWIB), which manages $156 billion in assets, was the first major pension fund to show it was holding bitcoin.

By the time they showed their hand, bitcoin had already peaked at around $74,000.

SWIB wasn't the only institutional buyer of bitcoin. Last quarter, over 600 financial institutions revealed bitcoin positions in their quarterly filings.

Friends, I've seen this institutional blueprint for stealing wealth play out again and again.

I saw this happen after the housing crisis in 2010–2012, when institutions started buying up foreclosures by the thousands… but individual investors couldn't get a mortgage.

I saw it in 2003 after the dot-com crash, when institutions started buying up internet and technology stocks on the cheap… But on CNBC, they kept telling the public it was too early to buy.

I saw it during 1994–1995, when institutions scoffed outwardly about how "dumb" money was buying internet stocks… while they were loading up as individuals were selling.

Don't be a victim of this strategy. The key to protect yourself is to focus on what institutions are doing… not on what they're saying.

Let the Game Come to You!

Big T

P.S. This short term pullback in bitcoin is creating an amazing buying opportunity in a handful of coins from a tiny sub sector of the crypto market.

I recently held a briefing explaining what this subsector is and how I believe you can make as much as 500x your money from this little understood corner of the crypto market.

Click here to stream the replay. But don't delay. I'm making a very special offer that ends Friday.