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The beginning of the big rebound?

Wednesday 18th April 2018

Good morning, Oliver,

The beginning of the big rebound?

Bitcoin has been one of the biggest – if not the biggest – story in the world of money over the last 12 months….

This column has done its bit to chart the various ups and downs. You can revisit our output in the archive on the Money Truths website….

Without ever setting out to do so, I’ve written extensively on the subject – learning as I go….

Perhaps the most interesting feature of the whole exercise for me was to observe how my own mind operated during the peak of the Bitcoin mania….

Even though I knew that Bitcoin was in the grip of a mania and that the huge increases in the price of Bitcoin were the direct result of a speculation bubble – I stillfound myself grappling from time to time with the fear that I was missing out….

  • The fear of missing out….

Towards the end of 2017 a lot of people believed that getting rich was as easy as buying Bitcoin and holding on to it for a week or two before selling it on at a massive profit….

People were buying the cryptocurrency on their credit cards….… Click here to read more

Looking beyond the foreground….

Thursday 12th April 2018

Looking beyond the foreground….

Futures contracts are a recent addition to the cryptocurrency sector….

The Chicago Board Options Exchange (CBOE) went live with Bitcoin futures contracts in mid-December last year.

Just a week later, the CME Group (CME) – the world’s largest futures exchange – followed suit….

At the time, Bitcoin was trading close to its all-time high. It seemed like all you had to do to get rich was to buy as much of the cryptocurrency as you could afford, wait a few days and sell to the next willing buyer….

Many Bitcoin players, pundits and sideline observers saw the introduction of futures contracts as the catalyst that would lift the cryptocurrency to even greater heights….

But things seldom work out as expected. And that’s how it proved in this instance….

The introduction of Bitcoin futures contracts acted as the catalyst that has seen Bitcoin fall from $20,000 to $6945.26 this morning….

Given the opportunity to go long and short on Bitcoin, traders took the opportunity to call out what they clearly believed was an over-extended Bitcoin price. And it’s been downhill all the way ever since….

  • The catalyst that re-ignites the boom?

There are signs that market expectation is beginning to stir again….… Click here to read more

You can’t rely on confidence….

Wednesday 4th April 2018

You can’t rely on confidence….

I took a break over Easter – cutting back on the usual volume of reading and taking a more leisurely stroll through the daily newspapers….

On a go-slow you see things you don’t see when you’re rushing headlong from one bit of news to the next, from one event to the other….

At a more pedestrian pace over the weekend it occurred to me how rapidly fortunes can turn in the world of money….

How swiftly last year’s big thing turns into this year’s has-been. How fast what was dependable becomes the opposite….

Nothing – or very little – lasts. Situations are almost always ripe for change. What the market is confident about today can look foolish a week later….

Recent events offer more reminders of this important contextual lesson….

  • The poster boy is not what he was….

Look at Bitcoin….

What happened to the big strong lad who just a few months ago looked like he might move mountains with his bare hands?

Did someone forget to feed him his Weetabix? Did some foreign agent acting on the orders of Vladimir Putin expose him to some noxious substance?

Whatever, the star-performer and poster-boy investment opportunity of 2017 now looks like a juiced-up body-builder that failed a drugs test….… Click here to read more