Mastering Markets | Invest Like A Pro In August 2020

published on August 1, 2020

What's going on everyone my name is nicholas merton here at datadash and today is july 30th of 2020 well folks i hope you are having a fantastic day wherever you are and in today's video i want to spend some time to not only

Take a look back at the month in review and take a look over what happened in july as well as take a look into what's going to be happening or what we're watching going into the month of august we've had

A phenomenal month so far gold breaking out to new all-time highs silver rallying at rapid paces bitcoin breaking past resistance and all coins leading the way in the rally so we've

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Alright everyone so to start off here i want to go ahead and as i mentioned take a look back over this past month july has probably been the best month that i've seen as an investor many of you have possibly seen as an investor

In quite some time if you've been allocated to cryptocurrencies as well as precious metals it's been phenomenal uh markets are showing all kinds of signs of optimism in regards to crypto

And precious metals and now we're starting to see a rapid outpace against equities which have been really leading the way for the last few months so again now that we are obviously seeing winners here you know many of

You who are subscribed to the dash report you know we're riding on the wave of cava rlc a lot of the cryptos we talked about either way though it really didn't matter like if you were so long as you were focused on the two markets

We've been discussing of enterprise blockchain which deals with you know protocols or oracles or plays like unibright outside of that as well taking a look into the d5 space and look at the

Governance tokens looking at a lot of the other different types utility tokens tied to these platforms all in all you want out it was a great month and because of that

We need to focus on whether or not that needs to be you know where we're positioned this time around or if there's other things we need to be watching as well so let's just go ahead and start off here

First and foremost and begin reviewing for the outlook to august so we've got obviously a phenomenal break out of bitcoin over the last two weeks we've climbed from price range the open of this week around

9 200 all the way up here to a relative high here of 11 400 so this is really phenomenal to see to see two weeks in a row we're almost

In double-digit territory for bitcoin on a weekly performance this is great and this is also again proof that we were confident for the months of consolidation unlike the two previous highs here

The months of consolidation against this line of resistance and it was just waiting to press and coil up here so i would say don't even bet on an opportunity bitcoin go to 6k if you had any of those bearish predictions

Because we've broken through the resistance this is the first time since 2017 and we've seen historically not just in crypto markets but also in traditional markets like gold when you pop above that resistance

The only thing that bears can hope for is that this is going to come down to the line of resistance or previous resistance and make it support quite frankly though i'm not waiting around to see if that's going to

Happen there's a possibility i'm not looking to trade or alter my positions here the only thing i'm doing is going in and out of crypto in this case likely from bitcoin to

Other all coins in this case now speaking solely on bitcoin here the thing you're going to want to watch for is maybe a possible retest down here but i would say something much more likely to happen is that we

For example continue climbing a little bit set a pullback right we're setting in higher highs and higher lows right this cycle is going to take a little while to eventually get back

Above its highs and this is why you know i basically talked about how i expect some time in q1 of 2020 to be where we actually smashed through this resistance at 20k now the line i drew here is very generic

I have no doubt there's a chance we could push more sideways you know for a few months consolidate against this 20k resistance and then really pop through who really knows what's going to happen

That's months out all i want to say though is in the short term as i emphasized we want to set it in august a higher relative high so the relative highs were down here around 12

000 we're very close to possibly being able to set one at 13 000 here over the next month we have plenty of time to do it and after that we want to send set in a higher low in this case to

Consolidate and basically showcase that we're holding the majority of the gains and that we've very clearly broken through resistance and we're going in for the continued

Cycle second thing as well altcoin dominance i want to continue to see higher levels of all coin dominance now that we've had this pullback here does provide an opportunity for some bulls who

Have missed out on a lot of this kind of exponential portion of the rally to get back in a lot of the d5 plays the enterprise blockchains uh all kinds of different places we've been watching or some of them which we traded and took

Some profits on do look pretty favorable at these levels will the small caps and mid caps be the leaders i think they will in the long term because they obviously have the market

To scale and they're doing some very unique things but at the same time the major thing to focus on as i think really a lot of the large caps and a lot of the established

Protocols so some of the kind of new emerging protocols i know many of you are going to be excited for me to say this plays at cardano plays like tezos some of the other ones alongside some of

The large caps like ethereum litecoin xrp this is going to be our major focus here and speaking about litecoin and some of the kind of more established cryptos let's take a look at the usd chart here

On the logarithmic we're taking a look at the weekly chart just like bitcoin just like ethereum building up long-term technical formations litecoin has very clear points of resistance

And support and it looks like here if you really take a look at the log chart we just need to basically get above seventy dollars we could really start to see this take off again we usually always look at the

Bitcoin chart again i think that's very important to look at the litecoin to bitcoin ratio similar to the gold and silver ratio right it's obviously looked very favorable just for those of you who

Maybe by chance haven't seen it i'll go ahead and display it this is again why uh litecoin is one of my key plays here take a look at bittrex we can see here going off the log chart just to really show here at scale

Right we are very very close to the entries on the weekly having one of its most interesting technical patterns a double bottom here towards this kind of range that we get optimistic and anytime we get down

Towards this range it's very very soon or very likely that we're going to get an accelerated rally we've seen it multiple times in the past ethereum as well same exact pattern as

Likely on the usd chart right but the thing is we're a little bit ahead of time it's one of the larger cap cryptos it's already built up resist excuse me support on previous resistance

And broken out here and we were talking about this for the past few weeks and months is why we were long ethereum i still hold a decent position in ethereum as a crypto um and i think it's going to continue to

Go out eventually to set all-time highs and accelerate towards even higher levels if it can properly scale it's one of my biggest concerns about ethereum but at the same time

Scaling i think in the short term is really not going to affect each price so again focus on these large caps guys that's the key thing i think that we're going to have to focus on definitely still a long crypto not

Trying to generally take profits from the space just cycling between the positions that i feel are undervalued at the time now we've talked about crypto one they want to talk about and this goes to not

Only cryptocurrency markets it doesn't just go to gold and silver it really goes to everything and that's what's happening with central bank monetary policy i know i've hit on this point before

But i want to re-emphasize just how important what we're seeing is right now is the fed just had their fomc meeting yesterday as we talked about the fed did practically nothing they kept things

Unchanged rates stay the same most programs generally stayed the same in regards to quantitative easing right nothing shocking there but the fed sooner or later according to what's

Happening with the dollar index so basically the general performance of the dollar against other foreign currencies with the cme uh cme prediction markets and most importantly with treasury

Yields this is the 10-year treasury yield we're taking a look at and this is each candle represents three months so since back here in the 80s treasury yields have been on a general decline

But it looks like within the next quarter or so the 10-year yield could go down to zero percent if not negative what does that tell us when the market

Right market right now is showing us the treasury yields that we're almost going towards negative what does it tell you what tells you the federal reserve is getting very very close to negative interest rates

J-pal can say that they're never going to do it you can say that it's not a possibility but we've seen what happens in japan and europe the same exact rules are at play this is

The thing that you have to understand ignoring the euro versus the dollar the labels they all operate under the same structure there is an inevitable flaw when you

Stimulate things too far rates can only go so low until they start to turn negative now what does this mean right most you really don't dabble in treasuries or bonds could you go long bonds yeah

There's etfs like tlt and as you can see as the yields drop the treasuries start to do well they're right back nearly back to their all-time highs for the 20-year treasury bond etf right so if you've

Been long bonds you know done pretty good i mean definitely not as good as like crypto and equities but still really good for months i've been back here since november 2018 since the fed started to revert monetary

Policy but the thing i want to talk about this is we're talking about trillions of dollars in treasury markets tens and then hundreds of trillions of dollars in the greater bond market

So understanding this we need to know what this impact is going to have on cryptocurrency markets it's going to be good it's going to be great because people are going to be looking

For assets abroad it's going to be beneficial for commodities and it's also going to be beneficial for equities there's one thing to keep in mind here right now the four big tech companies

Apple amazon alphabet and facebook alphabet being google and also the next six companies majority are the biggest chunk of this being microsoft another major tech giant that

Just kind of gets ignored sometimes they in total are worth trillions upon tons of dollars many of which are stepping very close to the 2 trillion mark apple very close amazon very close alphabet

Might pop up here in the near future i know that microsoft as well is very close to 2 trillion i just want to ask you all a very personal question here i think it's very relevant as an

Investor to consider would you want to buy a company at two trillion dollars because many of you out there you know who are in crypto you're expecting multiples of doubling your money

Tripling your money as a macro trader i do the same thing i like to find out where i can park my capital that's going to have the best return it's not really being greedy the other

Day it's just being smart if you're willing to do the dedicated research you deserve the kind of results that you can get right in order for a two trillion dollar company to double it needs to go to four

Trillion dollars in valuation now it's not to say that in this world of the federal reserve living in la la land alongside other central banks and printing as much money as they want that they can't get to 4 trillion

What do you think is more likely in the next year do you believe that apple is going to go not only to it towards a two trillion dollar valuation or even let's just let's just take it at its current evaluation right 17

Trillion do you think a 34 trillion dollar valuation is going to be reasonable in 2021 do you really want to take that risk and how long do you think it would stay at

That valuation even if it could make it on the other hand i didn't say quite confidently that silver could easily double and hold those levels and possibly climb even higher i can tell you that bitcoin

Could do the exact same that hundreds of different altcoins are going to do that if not more so are we changing our focus i'm not personally the only adjustments i'm making are

Circulating within the crypto market and this is the key goal while i constantly talk about market scale bitcoin is such a small market it's sitting at a 200 billion dollar market cap right now and that's not even

Deducting the lost bitcoin it's not deducting all of the different types of things we need to consider here when we're taking a look at bitcoin as an asset give or take there's 150 160 billion

Dollars of bitcoin out there that's actually available right now at the moment with the having event with the amount of institutional demand we've already seen

Get ready for a bumpy ride guys it's going to be exciting so i know i've ramadan enough today if you like this video please consider dropping a like down below but all in all everyone i

Hope you're all having a fantastic day and i'll see you all in the next one stay tuned everyone

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