Friday June 17, 2016 6:30 AM
From yesterday’s blog post: If I chase every dollar, it’s very likely I will panic on the day they decide to drop back to the $10-15 range based on some “news” about a glitch in ETH or who knows what.
No I did not expect that to happen yesterday exactly as I called it. However, I noted red flags on both ETH AND BTC throughout this entire week.
For me, this drop in ETH based on an alleged hack of The DAO was completely predicted by the patterns.
So was The DAO hacked? I have no clue.
Does it matter? Sure it matters! Even though I don’t own any of The DAO I don’t want my crypto accounts hacked and it’s a very real concern (which is why I don’t have too much of my entire portfolio invested even though I would like to).
There’s no doubt in my mind that ETH / BTC / DAO and all the cryptocurrencies will see volatility due to the threat or even a rumor of hacking, and I believe it’s a well known risk already priced into the market.
Again, I could lose everything to a hacker or the market for ETH might go to zero thanks to a hacker, but I will be investing based on the probabilities provided by THE PATTERNS.
Okay, so what about my trading plan now?:
I took 5% more off my ETH position yesterday at 20.50 so I currently sit with 30% of my core position in ETH.
My gains on this portion were over 100% held just over a month.
While I can’t say much about the realities of The DAO hack, I believe the move down in ETH is a real move down as the patterns and insanely high volume confirm it.
I will likely take another 5% off if we go back down to $15.10 to get to my target core position of 25%, and I see a moderate probability of this down move taking us below $10. If we fall below $7.50 then the bullish case and $36 price target becomes very much in doubt
I’ll be watching for patterns to add back with the goal being returning to 100% of my core ETH position, but won’t get sucked into the moves up that are likely to happen over the next couple of days as people are sure the worst is over. It might be, but most corrections last for more than one day, especially when the first move down is so powerful and has such volume.