ETH BTC Drama Unfolding in Slow Motion

tweet hard fork survey

Saturday July 2, 2016  7:30 AM

The charts say it all, nothing has been decided about the where ETH and BTC are headed next.  There are major events in the near future that could change that in a hurry, and I expect that to happen–meanwhile, we wait.

Here are a few thoughts I’m keeping in mind as I refine my trading strategy moving forward (in no real order):

*BTC is still well in the middle of a bearish pattern with a 375-425 downside. Only breaking 800 convincingly can change that. However, it’s worth noting (but not worth investing based on) BTC did break a few short term downside patterns over the last week which has led it back near $700.

*I think about selling my 25% core position in ETH every day when I read about the “progress” being made in solving the DAO crisis. The Twitter poll above shows me that everyone is confused about what is happening and what to do to save The DAO and possibly ETH itself.

*I just watched a live streaming talk in front of a good size industry audience by  Lefteris Karapetsas, who is apparently a key player in all this.  He laid out all the nightmares facing ETH and the lessons learned.  The scariest part of his presentation was at the end when he asked for questions — NONE. No one had questions about how to solve an issues with so much at stake? He was surprised…I was shocked.

* I’m holding on to my ETH as solving nightmares like these can lead to huge gains, but I’m surely not adding at this point.

*There’s now a real probability that ETH could go to ZERO. I don’t consider it a strong probability, but to ignore it in my trading decisions would be irresponsible.

*On the other hand, there is nothing in the patterns that say to sell ETH longer term. The bullish case and my $36 price target predicted when ETH reached $20 is still very much in tact–though the probability has decreased slightly with that spike below $7.

*While it has little to do with trading, I’m trying to form an opinion on how to best solve The DAO crisis, but there’s so many good points on both sides, I simply can’t. It certainly looks like a “lose-lose” situation to me.

*Gun to my head? I would NOT hard fork. Rather I would try to find more ways to delay the release of the funds and have votes on how to best pursue the attacker without violating any of Ethereum’s basic protocols. For example, using legal means, or perhaps another attempt to reroute the money the Attacker has claimed back into the DAO. These are weak solutions at best, horrible at worst, but they sound better to me than destroying the integrity of Ethereum’s entire premise. Certainly future DAO’s will be far more careful as will investors with their money.

*Easy for me to preach about not bailing out DAO investors since I did not invest in the DAO

*I’m still hung up on other legal aspects of DAO’s – like personal liability for wrongdoings of a DAO. Could this actually be tested in the current DAO nightmare? Could individual investors be sued and personally liable for simply INVESTING in the DAO?  They don’t have corporate protection and Partners in a partnership would be so I have to wonder….

*BTC has it’s own big event coming up in the next week or two – “the halvening” where newly mined BTC will be worth half of what was mined prior. While I am overwhelmingly impressed with the genius of BTC, I have no idea what to expect from this event other than volatility.

*If I had to predict BTC’s path based on the patterns I could see a spike up on the “halvening day” maybe even shortly above 800, then a drop in price headed towards my 375-425 target.

*I will likely not trade either BTC or ETH again until I see some big moves. Both have been coiling up in a tight range for some time now–usually leads to fireworks and there’s news coming to light the fuse….



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