Bitcoin Soars on Silicon Valley Bank Collapse

But is this Price Spike Sustainable?

BTC has soared from $19,706 to a short-term high thus far of $26,392 on the back of the Silicon Valley Bank failure, a whopping 33.9% increase in just a few days. Even though this massive rapid spike price makes no sense, as BTC is not a safe haven asset from US dollar risk, what I think really doesn’t matter, because in the end, the only thing that matters is price behavior (the concept that Cathie Wood of ARKK investments failed to realize for the entire duration of 2021 and 2022).

Though some BTC HODLers, after sitting through a massive crash in BTC prices from near $70,000 in November 2021, have taken to social media to celebrate this immediate-term 34% rise in prices, doing so is a bit premature in light of two things. Number one, given BTC’s historical massive volatility, one has to conduct a deep dive of the conditions that gave rise to this rapid 34% price rise and determine it they are sustainable. If they are not sustainable, another volatile period to follow to the downside that wipes out this rise to $26,392 can very well materialize and unless one sold all of one’s BTC when it reached $26,392, then celebrating this rise if it is followed by a period of significant downside price volatility is meaningless. And number two, for those that have been HODLing since November 2021, an additional 150% gain would be necessary simply just to get back to the $66,000 price at which I informed my subscribers to divest of all BTC at that time.

Furthermore, if one understands how to play volatile price movements in gold and silver assets, reaping 150%+ gains in just a few days, as I accomplished with mutiple investments by entering SLV call options and call options on other silver mining stocks at various strike prices when prices were getting slammed the week of 6 - 10 March and then divesting of them earlier this week when silver prices spiked on 13 March can still dwarf any gains from a volatile rise in BTC prices. Below I’ve posted the consequent 150%+ yields I reaped from one tranche of my SLV call options at a 19 strike price after being in this position for just a few days ($737 spent on this tranche of SLV call options on 7/8 March and exited at $1,857 on 13 March a few days later). I closed out the other tranche for similarly large triple-digit yields the same day.

Thus, a 34% BTC gain pales in comparison to yields one can reap by learning how to take advantage of precious metal asset price volatility as well, even if BTC prices significantly outperform underlying precious metal asset prices. In fact, the yields I reaped by entering call options across multiple silver assets actually would have been even greater had I held on for just one more day, but I believe in taking massive gains off the board when they materialize, for they are never guaranteed to keep growing. And this is a strategy I believe all BTC investors should execute, and have preached this strategy for over 2 years now with BTC, but no BTC HODLer will embrace this strategy. BTC HODLing and hoping is not a strategy. BTC trading and taking profits off the table when they come furiously is a much wiser strategy. In fact, for holders of Grayscale Bitcoin Trust, with current prices at $13.91 right now, I would thank my lucky stars for the recent recovery and have a definitive exit strategy in place as well, as not only did GBTC’s shareprice receive a massive boost from the SVB collapse but it also a received substantial boost from ongoing talks to convert the trust into an ETF, an event that has no guarantee.

For full disclosure, for those on the fence about subscribing here, I do NOT discuss option strategies with GLD and SLV here because option strategies are normally too time-sensitive and too fast moving in price for me to grant such strategies here (Thus the reason I’ve only discussed one option strategy on this platform for paying subscribers here as an “official” strategy. The one put option strategy I discussed here were put options on Walmart stock that I knew would take a few weeks to play out and thus could be profitable for all traders here. This strategy of mine eventually yielded returns of about 146% by the time I suggested closing out the WMT puts). 

However, if you subscribe to my patreon, on which I literally provide gold and silver price predictions every single week, you would have known that on 9 March, I stated that the gold and silver price slam was over and that gold and silver prices would reverse and rise into this week. And for experienced options traders that subscribe to my patreon platform, everyone could have used my price prediction offered a week ago to make the same trades as the one illustrated above. For full disclosure on my patreon platform, I do not discuss option trades there either but once in a blue moon due to the fact that it would be impossible to copy my trades unless I live streamed them, which I do not do. That said, options traders have informed me that they have made some extremely profitable options trades with gold/silver assets using the price predictions I provide every week on my patreon platform.

But the point is, since gold/silver assets prices, and not just crypto prices, will be volatile during such events as bank collapses, even though precious metal assets may not exhibit as much price volatility to the upside in their paper prices as BTC (which also supports my thesis that the Western Banking Cartel is much more focused in controlling gold/silver prices versus BTC prices), playing derivatives during these times can still yield far superior yields to any yields possible through HODLing BTC. In fact, I believe that the banking cartel is happy with rising BTC prices during such turmoil as it keeps attention and money diverted away from gold/silver and tricks the krill (versus the whales) to invest more money into BTC.

Furthermore, for those BTC HODLers stating, “How’s gold doing?” in a sarcastic mocking fashion (and I saw dozens of these comments on social media platforms), gold and even the more volatile silver, do not sell off nearly as much during their downturns as BTC does when BTC suffers volatile price crashes. Thus smart investors turn to gold as a safe haven because (1) we are fine with slow, steady growth as long as the growth is outpacing inflation over a multiple year period; and (2) we are never going to experience a 77% crash in one year as BTC did from November 2021 to November 2022. A similar crash, percentage-wise, would require even the fake synthetic $1,916 gold price to collapse to $441 by March 2024. This will never happen.

The Quintessential Question for BTC HODLers

What now for BTC after its whopping 34% increase in just a few trading days?

Unfortunately for BTC HODLers, my analysis of the movers and shakers in this market showed that the influential players were selling into the rise to $26,379 and not adding more positions into the rise, which likely means that the $26,000 level will mark the immediate-term high for this price rise. Of course, this could change if BTC can stay above $25,000 (trading at $25,008 as I publish this article) for the next few weeks, and if it does, then I will be sure to let paying subscribers here know in another analytical article. But as of right now, I see stronger evidence that BTC prices will be knocked back down not to $20,000 over the next couple of months but even lower from where this current price spike started, to the price predictions I provided in my last BTC update here.

But as I’ve always stated, I can only give my opinion based upon the behind-the-scenes action I observed with BTC during its current price spike. If it were bullish I would say so, but it was not. In addition, I consider my area of expertise to be in the precious metals arena and not in BTC. I analyze completely different metrics from other BTC analysts when formulating my BTC price predictions, though the metrics I analyze with BTC are not exactly the same, but still very similar, to metrics I’ve used to predict very accurate weekly gold and silver price movements for many years now. Thus, one should always read what analysts diametrically opposed to my analysis are saying, such as this article that claims BTC now has a “Picture Perfect Bullish Setup” and this analyst, Kaleo that states BTC will continue ripping higher to $40k by April, not to mention numerous other calls for BTC to now rapidly move to $100,000. 

Though I truly am confused by these massively bullish calls as nothing in the metrics I analyze points to much higher prices from this point forward, they still are worth reading and considering. And if Kaleo is correct in that BTC prices rip higher to $40k by April, then I expect all the metrics I follow in making my BTC price predictions to completely and very strongly reverse. So it will be interesting to see if the uber bullish BTC analysts turn out to be correct versus my diametrically opposed perspective.

However, when you take into account the bullish BTC analysis into your decisions, as you should, be sure to vet these analysts’ claims that with their stops based upon the current BTC price spike, they will guarantee for themselves a 30% gain. I have a difficult time believe that none were HODLers from the $69,000 peak in November of 2021, as when I issued my sell all your BTC opinion at $66,000 back then, some of the usual BTC permbull analysts mocked my call back then and stated that BTC prices would easily surpass $130,000 at a minimum and that to sell all BTC at $66,000 was foolish. Thus I have a hard time believing that some of the permabull BTC analysts claiming a minimum 30% gain on this recent BTC behavior did not ride BTC prices down since 2021 and/or did not keep stacking on fallling prices. Like I stated above, if this were the case, then even with a 30% gain, another additional 100% to 150% gain would still be necessary to get back to even from November of 2021.

As I stated in my latest update to my BTC price predictions (given in the link above), I have temporarily removed all time frames for my last updated price predictions other than “a few months out” until I receive definitive word of when the EU will vote on the MiCA (Markets in Crypto Assets) regulations, which has been tabled as far back as last June 2022, but indefinitely delayed and delayed and delayed. Once I receive word of when the MiCA regulations will go into effect, then I can provide more specific timeframes for my BTC price predictions. But for now, I’m really not feeling the onslaught of massively higher BTC price predictions filling crypto news sites that are primarily based upon simply the continued macro perspective of more bank failures but no real analysis of concrete price factors that will definitively push prices above $30,000 let alone $50,000.